The contract between Coinbase and its customers allocates property rights in personal information. That protects customers’ privacy along many dimensions.
The risks to Coinbase customers from the sharing of data with the government are substantial, requiring that any subpoena be tightly circumscribed. The IRS issued a grossly overbroad subpoena and declined to narrow it until less than a month ago. This Court has wide latitude to limit or quash the subpoena even apart from the issues of improper purpose and abuse of process raised by Coinbase and intervenor John Doe 4.
The IRS’s subpoena should be quashed in its entirety, not just narrowed. To do otherwise would reward the practice of issuing overbroad subpoenas as a sort of bargaining position that produces better results for the government than coming to court with a well-framed subpoena in the first instance. Given the high stakes for Coinbase users and the ease with which they can be notified, Due Process requires that they be directly notified if the subpoena survives in any form.