This line has been widely misinterpreted to make it seem like Google is saying Gmail users have no expectation of privacy when they use Gmail, and the outrage is thick. Consumer Watchdog put out a press release calling the line a "stunning admission" that "Google has finally admitted they don't respect privacy."
Unfortunately for outrage junkies, there's just nothing here. First of all, Google's argument isn't even about Gmail users, who are covered by Google's unified privacy policy. Google's argument is about non-Gmail users who haven't signed Google's terms of service. It's right there in black and white — the heading for the section literally starts with the words "The Non-Gmail Plaintiffs."
From there, Google's argument starts broadly and moves towards the specific — that's where the "a person has no legitimate expectation of privacy in information he voluntarily turns over to third parties" line comes in. That's a quote from the 1979 Supreme Court case Smith v. Maryland, in which the court upheld what's called the "third-party doctrine," saying that once you involve a third party in communication, you lose legally enforceable privacy rights.