"When he learned that no such authority had been granted and that there was a disinclination on the part of the authorities to use any legal process, including the Special Court which had been established to handle such matters, Mr. Nacchio concluded that these requests violated the privacy requirements of the Telecommications Act," Nacchio's attorney wrote in a statement.
Nacchio agreed with Qwest's attorneys that surrendering its customers' "call-detail records" to the NSA was wrong.
Qwest balked at the request, and pressure, from the NSA, with Nacchio reportedly "deeply troubled" by the implications, USA Today reports. Current CEO Richard Notebaert halted talks with the NSA in 2004 after the two couldn't agree on the details.
According to USA Today, the NSA told Qwest that not sharing the phone records could compromise national security and affect its chances at landing classified contracts with the government, two issues that play a role in Nacchio's own legal woes.
Qwest has been accused of massive fraud by the government and restating $3 billion in revenue. Former executives have been accused of wrongdoing, including Nacchio, who faces 42 counts of insider trading accusing him of illegally selling $101 million in company stock after privately learning Qwest might not meet its financial goals.
Meanwhile, CIA director nominee Gen. Michael Hayden on Friday defended the secret surveillance programs he oversaw while head of the National Security Agency as lawful and designed to "preserve the security and the liberty of the American people."
Hayden's visits to lawmakers on Capitol Hill were complicated by reaction to public disclosure of a NSA program that has been collecting millions of Americans' everyday telephone records.
"Everything that the agency has done has been lawful. It's been briefed to the appropriate members of Congress," Hayden told reporters outside a Senate office. "The only purpose of the agency's activities is to preserve the security and the liberty of the American people.
"And I think we've done that," he said.
The White House stood by Hayden as he spent another day promoting himself in face-to-face sessions with lawmakers, CBS News senior White House correspondent Bill Plante reports. President Bush
"We're 100 percent behind Michael Hayden," press secretary Tony Snow told reporters Friday. "There's no question about that, and confident that he is going to comport himself well and answer all the questions and concerns that members of the United States Senate may have in the process of confirmation."
After meeting with Hayden on Friday, Sen. Chuck Hagel, R-Neb., said that he has "absolute confidence" in the general and said his Senate confirmation hearings would help get the facts on the surveillance programs.
"He's going to have to explain what his role was. To start with, did he put that program forward, whose idea was it, why was it started?" Hagel said. "He knows that he's not going to be confirmed without answering those questions."
Sen. Susan Collins, R-Maine, praised Hayden as an excellent nominee but said Congress should ask tough questions about the NSA programs.
The Republican chairman of the Senate Judiciary Committee, Sen. Arlen Specter, R-Pa., told CBS News he would call the phone companies to appear before the panel in pursuit of what had transpired.
"We're really flying blind on the subject and that's not a good way to approach the Fourth Amendment and the constitutional issues involving privacy," Specter said of domestic surveillance in general.
But the disclosure, reported in Thursday editions of USA Today, could complicate President Bush's bid to win Hayden's confirmation, one Democratic Senator said.
Earlier Friday, Judiciary Committee member Senator Joe Biden, D-Del., told CBS News' The Early Show that he thinks the disclosure will hurt chances for Hayden to be named the new head of the CIA.
"Hayden is a first-rate guy… But I think he's caught right in the middle of this. I think it's going to make it difficult," Biden said.
In a poll taken Thursday, almost two thirds of Americans said it was acceptable for the NSA to collect phone records. When asked if they would be bothered if the NSA had their phone records, Democrats and independents were more likely to be bothered than Republicans. The ABC-Washington Post poll surveyed 502 people by telephone.
The president on Thursday sought to assure Americans their civil liberties were "fiercely protected."
"The government does not listen to domestic phone calls without court approval," said Mr. Bush, without confirming the NSA program. "We're not mining or trolling through the personal lives of millions of innocent Americans."
Lawmakers, however, continue to demand information from the Mr. Bush administration about the NSA's database of telephone records.