Sky Global Sues US Government to Recover 116 Seized Web Domains

Canadian cryptophone firm Sky Global is seeking a court order to reclaim domains seized by the FBI and ICE, arguing the seizures unlawfully crippled its business.

Sky Global Takes FBI and ICE to Court Over Seized Domains

Sky Global, the Vancouver-based encrypted phone company linked to a multinational organized crime investigation, is seeking a federal court order compelling the FBI and US Immigration and Customs Enforcement to return 116 internet domains seized between May 2020 and March 2021, Computer Weekly reports.

The company filed a "notice of motion" in the Southern District of California arguing that US law enforcement acted unlawfully when it seized the domains, causing irreparable harm to its operations and forcing it to lay off 27 staff members and 14 contractors.

"Despite not having been charged with any crime, Sky Global's own websites are being used by the government to broadcast to the world the false and damaging suggestion that Sky Global was involved in serious criminal conduct in the United States and Canada," the motion states.

Indictment of CEO, No Corporate Charges

US prosecutors indicted Sky Global's Canadian CEO, Jean-Francois Eap, and former phone distributor Thomas Herdman in March 2021 on charges of racketeering and knowingly facilitating the import and distribution of drugs and the sale of encrypted communications devices. No corporate charges have been filed against Sky Global itself, and the US has made no attempt to extradite Eap.

Sky Global argues that providing encrypted phones is not illegal and draws a direct comparison to major technology firms. "What has happened here is the equivalent of the government seizing Apple.com because drug dealers use iPhone encryption features to communicate with each other. Such a seizure would never be allowed to happen to Apple or any other high-profile tech company," the filing states.

The company said it marketed its Sky ECC devices to clients in the legal, healthcare, and financial industries, and even supplied free phones to a Canadian police force in pursuit of a supply contract.

Attorney: A Legitimate Company 'Almost Shut Down'

Ashwin Ram, a partner at Steptoe & Johnson in Los Angeles acting for Sky Global, said the government's conduct raised serious concerns about due process. "Anyone concerned about privacy should be deeply troubled by how the government almost shut down a legitimate, law-abiding company that was attempting to address critical issues around data protection and privacy," he said.

Ram added that Sky Global had no operational control over its resellers and customers beyond contractual obligations that explicitly prohibited unlawful use of its technology. "Sky Global was essentially used as a pawn by law enforcement to support investigations against a small fraction of Sky Global's users and its third-party sales network," he said.

120,000 Users, 6,000 Linked to Criminal Activity

Sky ECC, which operated servers in both Canada and France, claimed approximately 120,000 users worldwide at its peak, making it one of the largest encrypted phone networks in operation. The legal motion argues that only around 6,000 users — roughly 5% of the total — migrated to a rival platform with documented links to criminal activity following the first domain seizure.

That rival platform was An0m, also known as Anom, an encrypted phone service secretly created and operated by the FBI and the Australian Federal Police to intercept drug trafficking communications. According to a US Department of Justice press release cited in the filing, demand for An0m "grew exponentially" after Sky Global was dismantled. "Criminal users sought a new brand of hardened encryption device to plot their drug trafficking and money laundering transactions and to evade law enforcement," the release stated.

Belgian, French, and Dutch Police Raids

Sky Global drew international attention in March 2021 when Belgian, French, and Dutch police launched coordinated raids against suspected organized crime groups and drug dealers identified through intercepted Sky ECC messages. Cryptographers from the French Gendarmerie had gained access to company servers hosted by French cloud provider OVH at its Roubaix data center, allowing them to intercept and decrypt hundreds of millions of messages. Additional servers were located in Canada.

The operation bore similarities to an earlier investigation by Dutch and French police, alongside the UK's National Crime Agency, targeting the EncroChat encrypted phone network, which used the same data center.

Steps Taken to Prevent Illicit Use

Sky Global's court filing details a series of compliance measures the company says it implemented to prevent criminal misuse of its devices. Resellers and distributors were bound by terms and conditions and a master distribution agreement requiring them not to sell phones for "illegal, illicit or criminal use." The company also monitored websites and social media for inappropriate marketing of its products.

From April 2020, Sky Global required all third-party distributors to obtain its approval before launching new websites, advertisements, or social media posts. The filing also states that the company "consistently cooperated with law enforcement" and required its partners to refuse requests to remotely wipe phones known to be under investigation.

The seizures, Sky Global argues, made it impossible to communicate with business partners by email and effectively paralyzed its day-to-day operations — all without any criminal conviction or corporate indictment to justify the action.

Source: Computer Weekly