Today, in a 26-page ruling the appellate court resoundingly rejected the Bush/Obama position, holding that the "state secrets" privilege -- except in extremely rare circumstances not applicable here -- does not entitle the Government to demand dismissal of an entire lawsuit based on the assertion that the "subject matter" of the lawsuit is a state secret. Instead, the privilege only allows the Government to make specific claims of secrecy with regard to specific documents and other facts -- exactly how the privilege was virtually always used before the Bush and Obama DOJs sought to expand it into a vast weapon of immunity from all lawsuits challenging the legality of any executive branch program relating to national security.
The ruling was by a three-judge panel, so the Obama administration is likely to request an en banc hearing, or appeal the decision to the Supreme Court.
UPDATE: Here's SCOTUSBlog, with an explanation of the split in the Courts of Appeal over the privilege, and how the Supreme Court may be forced to deal with it despite turning down a chance to rule on the privilege a year and a half ago.
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