(Rewrites throughout; Adds lawyer comments)
By Terry Baynes
WASHINGTON, Oct 9 (Reuters) - The U.S. Supreme Court on Tuesday rejected a challenge to a 2008 federal law granting immunity to phone companies for helping the government eavesdrop on private phone conversations.
The decision is the latest in which the court has refused to review government surveillance practices adopted since the attacks of Sept. 11, 2001.
The case involved 33 lawsuits brought against the phone companies in 2006 after news reports that the government had conducted warrantless surveillance.
Phone customers alleged that AT&T Inc , Sprint Nextel Corp , Verizon Communications Inc and others violated federal and state law.
In reaction to the suits, Congress in 2008 passed Section 802 of the Foreign Intelligence Surveillance Act, which gave the Attorney General the power to grant legal immunity to anyone providing assistance to the intelligence community.
Then-Attorney General Michael Mukasey used that discretion to block the 33 suits, which were dismissed.
The Electronic Frontier Foundation, the American Civil Liberties Union and others appealed, arguing that Section 802 violated the separation of powers doctrine of the U.S. Constitution.
Last December, the 9th U.S. Circuit Court of Appeals in San Francisco rejected those arguments, finding the telephone companies immune.
Asking the Supreme Court to review that decision, the civil liberties groups said the law allowed the executive branch to conduct "warrantless, suspicionless domestic surveillance" without fear of review by courts, and gave the Attorney General sole discretion to decide when eavesdropping was necessary.
The Obama Administration argued that lawsuits against phone companies should be dismissed to encourage cooperation in efforts to fight terrorism and help ensure that state secrets be kept under wraps.
The high court, without comment, declined on Tuesday to review the groups' challenge to the law.
Richard Wiebe, the lead lawyer for the customers, said the decision reflected the Supreme Court's growing reluctance to review challenges to the government's national security and intelligence-gathering procedures.
"It's one more example of the court stepping back from taking any role in enforcing the rule of law in the war on terror," Wiebe said.
He cited another surveillance case, brought by the ACLU against the National Security Agency, which the high court refused to review in 2008, along with other torture and detention cases.
"After 11 years and multiple congressional reports, public admissions and media coverage, the only place that this program hasn't been seriously considered is in the courts," Cindy Cohn, the legal director of the Electronic Frontier Foundation, said in a statement.
The plaintiffs will continue to pursue a parallel case accusing the government and its officials of using a "dragnet" against ordinary citizens, which the 9th Circuit had allowed to proceed.
The case is Hepting et al v. AT&T Corp et al, U.S. Supreme Court, No. 11-1200.
(Additional reporting by Jon Stempel; Editing by Claudia Parsons)
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Keywords: USA COURT/TELECOM