Let’s have a gander…
The logic being, a parent company / entity, doing business in the US, but storing client information overseas as part of a subsidiary’s business, because its physically closer to the subsidiary’s clients, still maintains control over that information and can be compelled to produce that information despite being physically outside the USA’s jurisdiction.
First that flies in the face of European privacy and data retention laws, and new laws, like in Russia, requiring that data of users be held on their home soil. If a government can compel a company to hand over any data the company has access to from any where in the world, then privacy and international borders mean nothing any more.
Second that argument will open American businesses with offices overseas to similar legal arguments in foreign countries. How would Americans feel about China issuing warrants for Microsoft user emails held in the US?
Or more interestingly, consider how the FBI (and CIA) have liaison offices around the globe, how would the US government feel about an FBI liaison office aboard being sued and issued a discovery order against computers they control on US soil?