UNITED STATES DISTRICT COURT WESTERN DISTRICT OF TEXAS AUSTIN DIVISION ____________________________________ ) STEVE JACKSON GAMES INCORPORATED, ) STEVE JACKSON, ELIZABETH ) McCOY, WALTER MILLIKEN, and ) STEFFAN O'SULLIVAN, ) ) Plaintiffs, ) Docket No. A 91 CA 346 ) v. ) ) UNITED STATES SECRET SERVICE, ) UNITED STATES OF AMERICA, ) WILLIAM J. COOK, TIMOTHY M. FOLEY, ) BARBARA GOLDEN, and HENRY M. ) KLUEPFEL, ) ) Defendants. ) ____________________________________) REVISED MEMORANDUM OF LAW IN SUPPORT OF PLAINTIFFS' OPPOSITION TO THE UNITED STATES' MOTION TO DISMISS OR IN THE ALTERNATIVE FOR SUMMARY JUDGMENT Sharon L. Beckman (BBO #552077) Andrew Good (BBO #201240) Harvey Silverglate (BBO #462640) Silverglate & Good 89 Broad St., 14th Floor Boston, MA 02110 Eric Lieberman Nicholas Poser Rabinowitz, Boudin, Standard, Krinsky & Lieberman, P.C. 740 Broadway, at Astor Place New York, NY 10003-9518 R. James George, Jr. (#07800011) Peter D. Kennedy (#11296650) Graves, Dougherty, Hearon & Moody 2300 NCNB Tower 515 Congress Avenue Austin, TX 78701 DATED: October 2, 1991 TABLE OF CONTENTS INTRODUCTION 1 I. THE GOVERNMENT'S MOTION TO DISMISS MUST BE DENIED 3 II. THE GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT ON THE BASIS OF A GOOD FAITH DEFENSE MUST BE DENIED 4 A. Good Faith is Not a Defense to an Action Against the United States under the Privacy Protection Act 4 B. Plaintiffs Have Raised Genuine Issues of Material Fact in Support of their Allegation that the Government Agents Did Not Reasonably Rely on the Search Warrant 11 1. Plaintiffs have raised genuine issues of material fact concerning whether the government's agents submitted a false and misleading warrant affidavit deliberately or with reckless disregard for the truth 15 (a) The government's agents knew or recklessly failed to discover that SJG was a publisher of books, magazines, and adventure games 16 (b) The government's agents knew or recklessly failed to discover that the Electronic Bulletin Board System Operated by SJG was a forum for constitutionally protected speech and association and not an instrument of criminal activity 20 (c) The government's agents knew or recklessly failed to discover that the BBS operated by SJG contained private electronic mail 22 (d) The government's agents knew or recklessly failed to discover that Loyd Blankenship was not a computer programmer at SJG 24 (e) The government's agents knew or recklessly failed to discover that the information published in Phrack was not a "program" or "source code" 25 (f) The government's agents knew or recklessly failed to discover that the information published in Phrack did not contain any proprietary warning 26 (g) The government's agents knew or recklessly should have known that the information published in Phrack was not "highly proprietary" or "sensitive," but was readily accessible to the public in published material, including material published by BellSouth and Bellcore 28 (h) The government's agents knew or recklessly failed to discover that the information published in Phrack was not worth $79,000 31 (i) The government's agents knew or recklessly failed to discover that Loyd Blankenship was not engaged in any interstate "password hacking" scheme 32 2. Plaintiffs have raised genuine issues of material fact concerning whether the government's agents reasonably relied on a warrant that was so lacking in indicia of probable cause as to render official reliance on it unreasonable 33 (a) The government's agents did not reasonably rely on a warrant devoid of facts indicating that evidence of criminal activity would be found at the offices of SJG 34 (b) The government's agents did not reasonably rely on the warrant, which failed to establish probable cause to believe that Loyd Blankenship was engaged in criminal activity 37 3. Plaintiffs have raised genuine issues of material fact concerning whether the government's agents reasonably relied upon a general warrant that failed to particularize the things to be seized 39 4. Plaintiffs have raised genuine issues of material Fact in Support of Their Allegation that the Search and Seizure at SJG Exceeded the Scope of the Warrant, and Violated the First Amendment 46 III. THE GOVERNMENT'S MOTION FOR SUMMARY JUDGMENT ON COUNT V MUST BE DENIED BECAUSE PLAINTIFFS HAVE RAISED GENUINE ISSUES OF MATERIAL FACT IN SUPPORT OF THEIR ALLEGATION THAT GOVERNMENT AGENTS INTERCEPTED THEIR PRIVATE ELECTRONIC COMMUNICATIONS 49 CONCLUSION 53 INTRODUCTION On March 1, 1990, government agents executed a warrant authorizing the search of Austin publisher Steve Jackson Games Incorporated ("SJG") and the wholesale seizure of computer hardware, software, and data therefrom. They found not a shred of evidence of criminal activity, but their search, seizure, and retention of equipment and data nearly ruined SJG. The government agents seized -- and then refused to return -- the text and research materials relating to an about-to-be released fantasy game book, causing SJG to miss its publication deadline and to spend numerous hours reconstructing the book from prior drafts. They also seized and shut down the Illuminati BBS -- an electronic conferencing system featuring public conferences and private electronic mail, used by SJG employees, writers, artists, and customers to discuss SJG books and games and related literary genres. The search and seizure, and subsequent retention of SJG property deprived the users of the Illuminati BBS of a unique forum for constitutionally protected speech and association, and left SJG so far behind and so much in debt that it was forced to lay off half of its valued employees. In the year and a half that has passed since the raid on SJG, the government has acknowledged that neither SJG nor Jackson were targets of its investigation. Moreover, in two other cases, United States v. Riggs and United States v. Neidorf, the government has moved to dismiss indictments arising from this same investigation on the ground that the activity under investigation did not amount to a federal offense. Plaintiffs have sued the government for violating their rights under the Privacy Protection Act and the Electronic Communications Privacy Act. In moving this court for summary judgment, the government has not denied much of the account set out above, but simply asserts that its agents did not realize that they were badly mistaken: They did not know that SJG was a publisher. They did not know that what they described as a "highly proprietary" and "sensitive" stolen "program" was actually just a text file of bureaucratic information readily available to the general public in public libraries, book stores, and publications issued by Bellcore and BellSouth. While its agents had a copy of the stolen text file they were searching for, the government argues it was "impossible" for them to particularize the things to be seized. Moreover, the government maintains its agents reasonably relied upon a warrant application that stated only that evidence, instrumentalities, and fruits of criminal activity would be found at the home of Loyd Blankenship or at the home of Chris Goggans, or at SJG. In the face of all of these mistakes, the government asks this Court to conclusively determine, without discovery or trial, that this lawsuit must be dismissed because its officers acted in "good faith". This opposition, and supporting declarations and affidavits, demonstrate the existence of genuine issues of material fact regarding the officers' good faith, and for that reason, summary judgment should be denied. I. GOVERNMENT'S MOTION TO DISMISS MUST BE DENIED. Although the government's motion is styled as a motion under Federal Rule 12(b)(6) to dismiss for failure to state a claim under ...
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