Steve Jackson Games/Secret Service Lawsuit -- Day One

By JOE ABERNATHY
Copyright 1993, Houston Chronicle

	AUSTIN -- Plaintiff's attorneys wrested two embarrassing 
admissions from the United States Secret Service on the opening day of a 
federal civil lawsuit designed to establish the bounds of constitutional 
protections for electronic publishing and electronic mail.
	In the first, Special Agent Timothy Foley of Chicago admitted that 
crucial statements were erroneous in an affidavit he used to conduct 
several search-and-seizure operations in a March 1990 crackdown on 
computer crime.
	Foley later conceded that the Secret Service's special training 
for computer crime investigators overlooks any mention of the law that 
regulates the extent of permissible search-and-seizures at publishing 
operations.
	The case, brought by Steve Jackson Games, an Austin firm, is being 
tried before United States District Judge Sam Sparks. Carefully nurtured 
over the course of three years by a group of electronic civil rights 
activists -- at a cost of more than $200,000 -- the case has been 
eagerly anticipated as a possible damper on what is seen as computer 
crime hysteria among federal police.
 	Plaintiffs hope to prove that the printed word exists just as 
surely on the computer screen as it does on a sheet of paper. The 
complaint also seeks to establish the right of computer users to 
congregate electronically on bulletin board systems -- such as one 
called Illuminati that was taken from Steve Jackson Games -- and to 
exchange private electronic mail on such BBSs.
	"This lawsuit is just to stand up and say, at the end of the 20th 
Century, that publishing occurs as much on computers as on the printed 
page," said Jim George, of the Austin firm George, Donaldson & Ford, 
Jackson's law firm. 
	That issue came into sharp focus during George's questioning of 
Foley regarding the seizure of the PC on which Illuminati ran, and 
another computer on which was stored the word processing document 
containing a pending Steve Jackson Games book release, GURPS Cyberpunk.
	"At the Secret Service computer crime school, were you, as the 
agent in charge of this investigation, made aware of special rules for 
searching a publishing company?" George asked Foley. He was referring to 
the Privacy Protection Act, which states that police may not seize a 
work in progress from a publisher. It does not specify what physical 
form such a work must take.
	"No, sir, I was not," Foley responded.
	"Did you just miss class the day that was taught?" George asked.
	"No, sir. The United States Secret Service does not teach its 
agents about special rules regarding search and seizure at publishing 
companies," Foley said.
	"Let the record clearly show that to be the case," George said.
	Earlier, Foley admitted on the witness stand that his original 
affidavit seeking a judge's approval to raid Steve Jackson Games 
contained a fundamental error.
	During the March 1990 raid -- one of several dozen staged that day 
around the country in an investigation that the Secret Service called 
Operation Sun Devil at the time -- agents were seeking copies of a 
document taken as a hacker trophy from BellSouth. Subsequently 
republished in an electronic magazine called Phrack, thousands of copies 
of the document were stored on bulletin board systems around the nation.
	Neither Jackson nor his company were suspected of wrongdoing, and 
no charges have ever been filed against anyone targeted in several 
Austin raids. The alleged membership of Steve Jackson employee Loyd 
Blankenship in the Legion of Doom hacker's group -- which was believed 
responsible for the break-in -- led agents to raid the Austin game 
publisher at the same time that Blankenship's Austin home was raided.
	Yet the only two paragraphs in the 42-paragraph indictment that 
established a connection between Blankenship's alleged illegal 
activities and Steve Jackson Games were shown to have been erroneously 
arrived at, when George produced a statement by Bellcore expert Henry 
Kluepfel disputing statements attributed to him in Foley's affidavit.
	"Is it true that Mr. Kluepfel logged onto (Illuminati)?" George 
questioned.
	"No, sir," Foley responded.
	"But you state that in your affidavit," George said.
	"That was a misattribution," Foley said.
	"So you had no knowledge that anything was sent to my client?"
	"No sir, not directly," Foley said.
	"Indirectly?" George asked.
	"No sir."
	The Justice Department, in papers filed with the court, contends 
that only traditional journalistic organizations enjoy the protections 
of the Privacy Protection Act. It further contends that users of 
electronic mail have no reasonable expectation of privacy.
	The trial was to resume at 8:30 a.m. It is expected to conclude on 
Thursday or Friday.

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Steve Jackson Games/Secret Service Trial -- Day Two

By JOE ABERNATHY
Copyright 1993, Houston Chronicle

	AUSTIN -- A young woman read aloud a deeply personal friendship 
letter Wednesday in a federal civil lawsuit intended to establish the 
human dimension and constitutional guarantees of electronic assembly and 
communication.
	Testimony indicated that the letter read by Elizabeth Cayce-McCoy 
previously had been seized, printed and reviewed by the Secret Service.
	Her correspondence was among 162 undelivered personal letters 
testimony indicated were taken by the government in March 1990 during a 
raid on Steve Jackson Games, which ran an electronic bulletin board 
system as a service to its customers.
	Attorneys for the Austin game publisher contend that the seizure 
of the bulletin board represents a violation of the Electronic 
Communications Privacy Act, which is based on Fourth Amendment 
protections against unreasonable search and seizure.
	"Because you bring such joy to my friend Walter's life, and also 
because I liked you when I met you, though I wish I could have seen your 
lovely face a little more, I'll send you an autographed copy of 
Bestiary," said McCoy, reading in part from a letter penned by Steffan 
O'Sullivan, the author of the GURPS Bestiary, a fantasy treatise on 
mythical creatures large and small.
	Although the correspondence entered the public record upon McCoy's 
reading, the Chronicle obtained explicit permission from the principles 
before excerpting from it.
	The electronic mail was contained on the game publisher's public 
bulletin board system, Illuminati, which allowed game-players, authors 
and others to exchange public and personal documents. After agents 
seized the BBS during a raid staged as part of a nationwide crackdown on 
computer crime, Secret Service analysts reviewed, printed and deleted 
the 162 pieces of undelivered mail, testimony indicated.
	When the BBS computer was returned to its owner several months 
later, a computer expert was able to resurrect many of the deleted 
communications, including McCoy's friendship letter.
	"I never thought anyone would read my mail," she testified. "I was 
very shocked and embarrassed.
	"When I told my father that the Secret Service had taken the Steve 
Jackson bulletin board for some reason, he became very upset. He thought 
that I had been linked to some computer crime investigation, and that 
now our computers would be taken."
	O'Sullivan, who is a free-lance game writer employed by Steve 
Jackson, followed McCoy to the stand, where he testified that agents 
intercepted -- via the Illuminati seizure -- a critical piece of 
electronic mail seeking to establish when a quarterly royalty check 
would arrive. 
	"That letter never arrived, and I had to borrow money to pay the 
rent," he said.
	No charges were ever filed in connection with the raid on Steve 
Jackson Games or the simultaneous raid of the Austin home of Jackson 
employee Loyd Blankenship, whose reputed membership in the Legion of 
Doom hackers' group triggered the raids.
	Plaintiffs contend that the government's search-and-seizure 
policies have cast a chill over a constitutionally protected form of 
public assembly carried out on bulletin boards, which serve as community 
centers often used by hundreds of people. More than 300 people were 
denied use of Jackson's bulletin board, called Illuminati, for several 
months after the raid, and documents filed with the court claim that a 
broader, continuing chill has been cast over the online community at 
large.
	The lawsuit against the Secret Service seeks to establish that the 
Electronic Communications Privacy Act guarantees the privacy of 
electronic mail. If U.S. District Court Judge Sam Sparks accepts this 
contention, it would become necessary for the government to obtain 
warrants for each caller to a bulletin board before seizing it.
	The Justice Department contends that users of electronic mail do 
not have a reasonable expectation to privacy, because they are 
voluntarily "disclosing" their mail to a third party -- the owner of the 
bulletin board system.
	"We weren't going to intercept electronic mail. We were going to 
access stored information," said William J. Cook, a former assistant 
U.S. Attorney in Chicago who wrote the affidavit for the search warrant 
used in the Steve Jackson raid.
	The Justice Department attorneys did not substantially challenge 
testimony by any of the several witnesses who were denied use of 
Illuminati. They did, however, seek to prevent those witnesses from 
testifying -- by conceding their interests -- after Cayce's compelling 
appearance led off the series of witnesses.
	Most of the Justice Department's energies were directed toward 
countering damage claims made by Steve Jackson, whose testimony opened 
the second day of the trial. Most of the day's testimony was devoted to 
a complex give-and-take on accounting issues. Some $2 million is being 
sought in damages.
	Justice sought to counter the widely repeated assertion that Steve 
Jackson Games was nearly put out of business by the raid by showing that 
the company was already struggling financially when the raid was 
conducted. An accountant called by the plaintiffs countered that all of 
Jackson's financial problems had been corrected by a reorganization in 
late 1989.

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Index: Day Three of the Steve Jackson Games/Secret Service Lawsuit. The
judge spent time straight reprimanding a Agent of the Secret Service for
the behavior regarding the raid and subsequent investigation of Steve
Jackson Games. Report by Joe Abernathy of Houston Chronicle. 

Paco X. Nathan: Steve Jackson Games - Day 3
Fri, 29 Jan 1993 11:12

Steve Jackson Games/Secret Service wrapup

By JOE ABERNATHYCopyright 1993, Houston Chronicle


        AUSTIN -- An electronic civil rights case against the Secret 
Service closed Thursday with a clear statement by federal District Judge 
Sam Sparks that the Service failed to conduct a proper investigation in 
a notorious computer crime crackdown, and went too far in retaining 
custody of seized equipment.
        The judge's formal findings in the complex case, which will 
likely set new legal precedents, won't be returned until later.
        A packed courtroom sat on the edge of the seat Thursday morning 
as Sparks subjected the Secret Service agent in charge of the 
investigation to a grueling dressing-down.
        The judge's rebuke apparently convinced the Department of 
Justice to close its defense after calling only that one of the several 
government witnesses on hand. Attorney Mark Battan entered subdued  
testimony seeking to limit the award of monetary damages.
        Secret Service Special Agent Timothy Foley of Chicago, who was 
in charge of three Austin computer search-and-seizures on March 1, 1990, 
that led to thelawsuit, stoically endured Spark's rebuke over the 
Service's poor investigationand abusive computer seizure policies. While 
the Service has seized dozens of computers since the crackdown began in 
1990, this is the first case to challenge the practice.
        "The Secret Service didn't do a good job in this case. We know 
no investigation took place. Nobody ever gave any concern as to whether 
(legal) statuteswere involved. We know there was damage," Sparks said in 
weighing damages.
        The lawsuit, brought by Steve Jackson Games of Austin, said that 
the seizure of three computers violated the Privacy Protection Act, 
which provides First Amendment protections against seizing a publisher's 
works in progress. The lawsuit further said that since one of the 
computers was being used to run a bulletin board system containing 
private electronic mail, the seizure violated the Electronic 
Communications Privacy Act in regards to the 388 callers of the 
Illuminati BBS.
        Sparks grew visibly angry when it was established that the 
Austin science fiction magazine and game book publisher was never 
suspected of a crime, and that agents did not do even marginal research 
to establish a criminal connectionbetween the firm and the suspected 
illegal activities of an employee, or to determine that the company was 
a publisher. Indeed, agents testified that they were not even trained in 
the Privacy Protection Act at the special Secret Service school on 
computer crime.
        "How long would it have taken you, Mr. Foley, to find out what 
Steve Jackson Games did, what it was?" asked Sparks. "An hour?
        "Was there any reason why, on March 2, you could not return to 
Steve Jackson Games a copy, in floppy disk form, of everything taken?
        "Did you read the article in Business Week magazine where it had 
a picture of Steve Jackson -- a law-abiding, tax-paying citizen -- 
saying he was a computer crime suspect?
        "Did it ever occur to you, Mr. Foley, that seizing this material 
could harm Steve Jackson economically?"
        Foley replied, "No, sir," but the judge offered his own answer.
        "You actually did, you just had no idea anybody would actually 
go out and hire a lawyer and sue you."
        More than $200,000 has been spent by the Electronic Frontier 
Foundationin bringing the case to trial. The EFF was founded by Mitchell 
Kapor amid a civil liberties movement sparked in large part by the 
Secret Service computer crimecrackdown.
        "The dressing-down of the Secret Service for their behavior is a 
major vindication of what we've been saying all along, which is that 
there were outrageous actions taken against Steve Jackson that hurt his 
business and sent a chilling effect to everyone using bulletin boards, 
and that there were larger principles at stake," said Kapor, contacted 
at his Cambridge, Mass., office.
        "We're very happy with the way the case came out," said Shari 
Steele, who attended the case as counsel for the EFF. "That session with 
the judge and Tim Foley is what a lawyer dreams about."
        That session seemed triggered by a riveting cross-examination of 
Foley by Pete Kennedy, Jackson's attorney.
        Kennedy forced Foley to admit that the search warrant did not 
meet even the Service's own standards for a search-and-seizure, and did 
not establish that Jackson Games was suspected of being involved in any 
illegal activity.
        "Agent Foley, it's been almost three years. Has Chris Goggans 
been indicted? Has Loyd Blankenship been indicted? Has Loyd 
Blankenship's computer been returned to him?"
        The purported membership of Jackson Games employee Blankenship 
in the Legion of Doom hacker's group triggered the raids that day on 
Jackson Games, Blankenship's home, and that of Goggans, a Houstonian who 
at the time was a University of Texas student. No charges have been 
filed, although the computer seized from Blankenship's home -- 
containing his wife's dissertation -- never has been returned.
        After the cross-examination, Sparks questioned Foley on a number 
of keydetails before and after the raid, focusing on the holes in the 
search warrant,why Jackson was not allowed to copy his work in progress 
after it was seized, and why his computers were not returned after the 
Secret Service analyzed them, aprocess completed before the end of 
March.
        "The examination took seven days, but you didn't give Steve 
Jackson's computers back for three months. Why?" asked an incredulous 
Sparks. "So here you are, with three computers, 300 floppy disks, an 
owner who was asking for it back, his attorney calling you, and what I 
want to know is why copies of everything couldn't be given back in days. 
Not months. Days.
        "That's what makes you mad about this case."