Democrats seek alternative on phone immunity

WASHINGTON (Reuters) - Democratic lawmakers drew White House fire on Tuesday when they offered an alternative to U.S. President George W. Bush's demand that phone companies that participated in his warrantless domestic spying program receive immunity from lawsuits.

Under the Democratic proposal, phone companies would present their defense in a closed-door U.S. district court, with the judge given access to confidential documents about the electronic surveillance begun after the September 11 attacks.

"This is a reasonable and intelligent way to proceed without jeopardizing our responsibility to fight terrorism," said House of Representatives Judiciary Committee Chairman John Conyers of Michigan.

But the White House, along with Bush's fellow Republicans in Congress, the Justice Department and the office of director of National Intelligence denounced the proposal, drafted by House Democratic leaders as part of a sweeping spy bill.

"As the bipartisan Senate Select Committee on Intelligence concluded, the failure to extend liability protection will undermine the private sector's willingness to help the intelligence community do its job," said White House spokeswoman Dana Perino.

Even if the full House passes the Democratic measure, it appears certain Republicans will block it in the Senate, extending with no apparent end in sight an election-year dispute over national security.

Senate Majority Leader Harry Reid, a Nevada Democrat, called the House bill "a tremendous step forward."

"My problem," Reid said, is that "President Bush doesn't negotiate on anything."

About 40 civil lawsuits have been filed accusing AT&T Inc., Verizon Communications Inc. and Sprint Nextel Corp. of violating Americans' privacy rights in the surveillance program authorized by Bush shortly after the September 11 attacks.

The 1978 Foreign Intelligence Surveillance Act requires the government receive secret-court approval to conduct surveillance on foreign targets in the United States.

Shortly after the September 11 attacks, Bush authorized warrantless surveillance. Critics charged he broke the law. Bush said he had the war-time power to do it, but he later put the program under FISA jurisdiction. Terms remain secret.

The proposed House bill would establish a national commission with subpoena power to investigate the program.

Republicans again urged the House to give final approval to a bill overwhelmingly approved by the Senate last month that would immunize phone companies and renew a law that expanded the power of U.S. authorities to track suspected terrorists without a court order. That law expired on February 16.

The proposed House bill would amend FISA to grant new authority for conducting surveillance, but not as much as demanded by Bush administration.

In a joint statement, the Justice Department and the office of the Director of National Intelligence said: "We are concerned that the proposal would not provide the intelligence community the critical tools needed to protect the country."

(Editing by David Wiessler)