IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT




NO. 93-8661




STEVE JACKS0N GAMES INC., et al.,
Plaintiffs-Appellants,



UNITED STATES SECRET SERVICE and
UNITED STATES OF AMERICA,
Defendants-Appellees.




ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS




BRIEF FOR THE APPELLEES




                              FRANK W. HUNGER
                                Assistant Attorney General

                              JAMES H. DeATLEY
                                United States Attorney

                              BARBARA L. HERWIG
                              SCOTT R. McINTOSH
                                Attorneys. Appellate Staff
                                Room 3127  Department of Justice
                                Washington, D.C.  20530
                                (202) 514-4052


STATEMENT REGARDING ORAL ARGUMENT

The legal issues in this case are straightforward, and the defendants do
not believe that oral argument is necessary to resolve them. However, the
defendants are of course willing to participate if the court believes that
oral argument would be of assistance.


                        TABLE OF CONTENTS

                                                             Page

STATEMENT REGARDING ORAL ARGUMENT ..............................        i

TABLE OF AUTHORITIES .........................................  iii

STATEMENT OF JURISDICTION ......................................        1

STATEMENT OF ISSUES ............................................        1

STATEMENT OF THE CASE ..........................................        2

     Prior Proceedings and Disposition Below  . . . . . . . . . 2

     Statement of Facts ........................................        3

SUMMARY OF ARGUMENT . . . . . . . . . . . . . . . . . . . . .  10

ARGUMENT  . . . . . . . . . . . . . . . . . . . . . . . . . .  11

I.   The Seizure Of Unread Electronic Mail Messages Stored In
The Company's BBS Computer Is Governed By Title II, Not
Title I, Of The Electronic Communications Privacy Act . 11

II.  Further Proceedings Are Required Regarding The Damage
Awards To The Company And Its Owner . . . . . . . . . . 20

CONCLUSION  . . . . . . . . . . . . . . . . . . . . . . . . .  22

CERTIFICATE OF SERVICE



                               ii


TABLE OF AUTHORITIES

Cases   Page

United States v. Turk, 526 F.2d 654 (5th Cir.),
cert. denied, 429 U.S. 823 (1976) . . . . . . . . . 9,10,16,17


Statutes

Electronic Communications Privacy Act of 1986,
100 Stat. 1848 (1986) . . . . . . . . . . . . . . . . . passim

Title I (codified at 18 U.S.C.  2510-21) . . . . . . passim Title II
(codified at 18 U.S.C.  2701-2709) . . . . . passim
Title III (codified at 18 U.S.C.  3121-26) . . . . . . . 12

First Amendment Privacy Protection Act, 94 Stat. 1879 (1980)
(codified at 42 U.S.C.  2000aa to 2000aa-12) . . . . . . . 2,7

Omnibus Crime Control and Safe Streets Act of 1968,
Title III, 82 Stat. 211 (1968) (codified as amended at
18 U.S.C.  2510-21) . . . . . . . . . . . . . . . . . . . 11

18 U.S.C.  1030  . . . . . . . . . . . . . . . . . . . . . . . 3
18 U.S.C.  1030(a)(1)-(6) .....................................        3
18 U.S.C.  2510(4) (1982) .................................... 12
18 U.S.C.  2510(4) . . . . . . . . . . . . . . . . . . . . 12,18
18 U.S.C.  2510(17)(A) ....................................    13,16
18 U.S.C.  2511 (1982) ....................................... 17
18 U.S.C.  2511(1)(a) (1982) ................................. 11
18 U.S.C.  2511(1)(a)  . . . . . . . . . . . . . . . . . . 12,14
18 U.S.C.  2511(2)(a)(ii) ....................................   12
18 U.S.C.  2511(2)(b) ........................................   12
18 U.S.C.  2511(2)(e)-(f) ....................................   12
18 U.S.C.  2516 ..............................................   12
18 U.S.C.  2516(3) ...........................................   13
18 U.S.C.  2518 . . . . . . . . . . . . . . . . . . . . . .    13
18 U.S.C.  2520 ...............................................        8
18 U.S.C.  2701  . . . . . . . . . . . . . . . . . . . . . . . 8
18 U.S.C.  2701(a) . . . . . . . . . . . . . . . . . 13,14,16,18
18 U.S.C.  2701(c)(3) .........................................        13
18 U.S.C.  2703  . . . . . . . . . . . . . . . . . . . . 8,13,14
18 U.S.C.  2703(a) . . . . . . . . . . . . . . . . . . . . .  14
18 U.S.C.  2707 ...............................................        8
18 U.S.C.  2707(a) . . . . . . . . . . . . . . . . . . . . .  22
18 U.S.C.  2707(c) . . . . . . . . . . . . . . . . . . . . .  22
18 U.S.C.  2711(1) ............................................        13
42 U.S.C.  2000aa(a) . . . . . . . . . . . . . . . . . . . . . 7
42 U.S.C.  2000aa(b) . . . . . . . . . . . . . . .



iii


Other Materials

S. Rep. No. 541, 99th Cong., 2d Sess. (1986), reprinted in 1986 U.S. Code
Cong. & Admin. News 3555 . . . . . . passim



iv


IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT




NO. 93-8661




STEVE JACKS0N GAMES INC., et al.,
Plaintiffs-Appellants,



UNITED STATES SECRET SERVICE and
UNITED STATES OF AMERICA,
Defendants-Appellees.




ON APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TEXAS




BRIEF FOR THE APPELLEES




STATEMENT OF JURISDICTION

The appellants' statement of jurisdiction is complete and correct.

                       STATEMENT OF ISSUES

In the course of a law enforcement investigation of potential federal
computer crimes, agents of the United States Secret Service seized a
personal computer that contained, inter alia, unread electronic mail
messages stored in files on the computer's hard disk. The issues presented
are:


1. Whether the seizure of the unread electronic mail messages was governed
by Title I of the Electronic Communications Privacy Act of 1986 ("ECPA"),
which regulates the "interception" of electronic communications, or instead
was governed by Title II of the ECPA, which regulates access to stored
electronic communications.

2. Whether the owner of the company whose computer was seized is entitled
to $3,018.51 in compensatory damages under the First Amendment Privacy
Protection Act.

3.   Whether the company is entitled to $1,000.00 in statutory damages
under Title II of the ECPA.



                      STATEMENT OF THE CASE

Prior Proceedings and Disposition Below

This appeal arises out of an action for damages under the First Amendment
Privacy Protection Act ("Privacy Protection Act") and the Electronic
Communications Privacy Act of 1986 ("ECPA"). The plaintiffs-appellants are
a game company, the company's owner and sole shareholder, and three
individuals who used an electronic bulletin board system operated by the
company. The defendants-appellees are the United States of America and the
United States Secret Service, which conducted a search of the company's
offices and seized the company's computer hardware and software.

The plaintiffs brought suit against the defendants in the United States
District Court for the Western District of Texas, asserting that the Secret
Service's search and seizure violated the Privacy Protection Act and Title
I and Title II of the ECPA.



2


Following a bench trial, the district court (Sparks, J.) entered judgment
in favor of the plaintiffs under the Privacy Protection Act and Title II of
the ECPA, but entered judgment in favor of the defendants under Title I of
the ECPA. The court entered a final judgment on July 26, 1993, awarding
approximately $51,000 in compensatory damages to the company and $1,000 in
statutory damages to each of the individual plaintiffs. The plaintiffs
filed a timely notice of appeal on September 17, 1994.

Statement of Facts

1. This case grows out of a federal computer crime investigation. Because
this appeal does not (with one minor exception) involve any material
factual disputes, the facts surrounding the investigation and the resulting
litigation may be summarized briefly.1

In early 1990, the United States Secret Service and the United States
Attorney's Office in Chicago, Illinois, began an investigation into
potential federal computer crimes. Under 18 U.S.C.  1030, it is a federal
crime to access specified classes of computers and computer information
without authorization or in excess of authorized access. The Secret Service
received reliable information that, among other things, a Bell South
computer system


1For purposes of this appeal, the defendants accept the district court's
findings of fact. The facts in the following statement are taken from the
district court's opinion and from the parties' Joint Stipulation of Fact.
The only material factual dispute in this appeal concerns Steve Jackson's
claim for lost royalties (see p. 20 infra).

2Different subsections of the statute contain different mens rea
requirements. See 18 U.S.C.  1030(a)(1)-(6).



3


had been the subject of an illegal intrusion, and that computer hackers
associated with that intrusion were attempting to use a password decryption
procedure that would allow illegal intrusions into computer systems
belonging to the Department of Defense. R.E. 2:6.

During the course of the criminal investigation, the Secret Service
received information suggesting the involvement of an individual named
Lloyd Blankenship. R.E. 2:4-5. The Secret Service also learned that
Blankenship was employed by Steve Jackson Games, a Texas company that
publishes books, magazines, box games, and related products. Id. 2:2; R.E.
4, Attach. A, at 11.

Steve Jackson Games uses computers for a variety of business purposes. At
all times relevant to this case, the company used one of its computers to
operate an electronic bulletin board system ("BBS"). R.E. 4, Attach. A, at
2. A BBS permits users of other computers to communicate electronically
with each other and with the BBS's system operators ("sysops"). Id. at 1.
The Secret Service was informed that Blankenship was one of the sysops of
the Steve Jackson Games BBS and that Blankenship "may well (and in fact
did) have the ability to delete any documents or information in the Steve
Jackson Games computers and * * * bulletin board." R.E. 2:6.

A BBS system offers users and sysops a number of communications
capabilities. R.E. 4, Attach. A, at 1. For present purposes, the most
important service is the capability to send private elec-



The appellants' record excerpts are cited as "R.E." The appellees'
supplemental record excerpts are cited as "Supp. R.E."



4


tronic mail ("e-mail") to other users of the BBS. Ibid. When one user (the
"sender") wishes to send e-mail to another user (the "addressee"), he or
she composes the message on his or her computer and transmits it
electronically to the BBS computer through a phone link. When the message
is received by the BBS, it is physically stored in a computer file on the
BBS computer's hard disk. The addressee accesses the message by having his
or her computer call the BBS computer. At the addressee's request, the BBS
software transmits the message to the addressee's computer, where the
addressee may read and/or save the message. When the message has been
transmitted to the addressee, it remains on the BBS computer until the
addressee or the BBS sysop deletes it. See generally S. Rep. No. 541, 99th
Cong., 2d Sess. 8 (1986) ("Senate Report"), reprinted in 1986 U.S. Code
Cong. & Admin. News ("USCCAN") 3562.

On February 28, 1990, the Secret Service sought and obtained a federal
warrant to search the offices of Steve Jackson Games and seize various
computer materials. The warrant (R.E. 5, Attach. B) covered:

Computer hardware * * * and computer software * * * and written material
and documents relating to the use of the computer system, documentation
relating to the attacking of computers and advertising the results of
computer attacks * * * , and financial documents and licensing information
relative to the computer programs and equipment at [the company's offices]
which constitute evidence, instrumentalities and fruits of federal crimes,
including interstate transportation of stolen property (18 U.S.C. 2314) and
interstate transportation of computer access information (18 U.S.C.
1030(a)(6)). This warrant is for the seizure of the above described
computer and computer data and for the authorization to read information
stored and contained in the above described computer and computer data.



5


The Secret Service executed the warrant on March 1, 1990. At that time, the
offices of Steve Jackson Games contained 13 functioning computers. R.E. 4,
Attach. A, ~ 6. The Secret Service seized 2 of the 13 functioning
computers, and one other computer that was disassembled for repair. Ibid.
The Secret Service also seized a large number of floppy disks, a printer,
other computer components, and computer software documentation. Id. ~ 32;
R.E. 2:9. Steve Jackson Games immediately requested the return of the
seized materials, but the Secret Service retained most of the materials for
several months before returning them. R.E. 2:10.

One of the computers seized by the Secret Service was the computer used by
Steve Jackson Games to operate its BBS. R.E. 4, Attach. A, ~ 2. The hard
disk of the BBS computer contained a number of private e-mail messages,
some of which had not yet been accessed by their addressees. R.E. 2:10;
R.E. 4, Attach. A, ~ 4. In the proceedings below, the Secret Service denied
that its agents read the private e-mail messages on the BBS computer. R.E.
2:11. However, the district court found that the Secret Service read all
e-mail messages on the computer and subsequently deleted "certain
information and communications," "either intentionally or accidentally,"
before returning the computer to Steve Jackson Games. Id. at 11, 20.

2. The search and seizure of Steve Jackson Games' computer materials led to
the filing of this suit in May 1991. The plaintiffs are Steve Jackson
Games; the company's owner and sole shareholder, Steve Jackson; and several
individual users of the com-



6


pany's BBS. The defendants are the Secret Service and the United States.
The plaintiffs alleged that the search and seizure gave rise to three
distinct statutory claims against the defendants.4

The first claim involved the First Amendment Privacy Protection Act
("Privacy Protection Act"). With certain exceptions, the Privacy Protection
Act makes it unlawful for any government official, acting in the course of
a criminal investigation or prosecution, to search for or seize any "work
product materials" or other "documentary materials" that are "possessed by
a person reasonably believed to have a purpose to disseminate to the public
a newspaper, book, broadcast, or other similar form of public communication
* * * ." 42 U.S.C.  2000aa(a), 2000aa(b). If the federal government
violates the statute, any person aggrieved by the violation may bring an
action for damages against the United States. Id.  2000aa-6(a)(1).

The second and third claims involved the Electronic Communications
Protection Act of 1986 ("ECPA"). As discussed in greater detail below (see
pp. 11-14 infra), the ECPA contains two different titles relating to
electronic communications. Title I of the ECPA, codified at 18 U.S.C. 
2510-2521, regulates the "interception" of electronic communications. Title
II of the ECPA, codified at 18 U.S.C.  2701-2709, regulates access to
stored electronic communications. Both titles provide private causes of
action for



4The plaintiffs initially advanced a variety of other legal claims and
named certain individuals as defendants. The other claims and defendants
were dismissed by agreement of the parties prior to trial. R.E. 2:1.



7


damages for persons aggrieved by violations. Id.  2520 (Title I), 2707
(Title II).
Following a bench trial, the court determined that the defendants had
violated the Privacy Protection Act. R.E. 2:15-20. The court held that the
materials seized by the Secret Service included "work product materials"
and "documentary materials" protected by the Privacy Protection Act. Id. at
16-17. The court held that the seizure of these materials did not give rise
to an immediate violation of the statute because, at the time of the
seizure, the agents did not (in the language of the statute) "reasonably
believe[]" that Steve Jackson Games "ha[d] a purpose to disseminate to the
public a newspaper, book, broadcast, or other similar form of public
communication * * * ." Id. at 17-18. However, the court held that a
violation occurred when the agents subsequently received information giving
them notice that the materials were protected by the statute and failed to
return the materials promptly. Id. at 17-20.

The court also determined that the defendants violated Title II of the
ECPA. R.E. 2:23-26. As explained further below, Title II restricts access
to electronic communications stored by providers of "electronic
communications services" and "remote computing services." 18 U.S.C.  2701.
Title II permits the government to obtain access to such materials, but
only if the government first complies with procedural and substantive
requirements specified in 18 U.S.C.  2703. Here, the court held that the
Secret Service "exceeded the Government's authority under the



8


statute" by seizing and examining the contents of "all of the electronic
communications stored in the [company's] bulletin board" without complying
with the statute's requirements for government access. R.E. 2:25.

Although the court accepted the plaintiffs' claim under Title II of the
ECPA, it rejected their claim under Title I of the ECPA. R.E. 2:20-22. As
noted above, Title I regulates the "interception" of electronic
communications. The plaintiffs asserted that the Secret Service
"intercepted" electronic communications when it seized the unread e-mail
messages stored on the BBS computer. The court acknowledged that the
individual plaintiffs "had private communications stored in [the BBS] at
the time of the seizure," but held that the seizure of the e-mail messages
did not constitute an "interception" within the meaning of Title I. Ibid.
The court placed primary reliance on United States v. Turk, 526 F.2d 654
(5th Cir.), cert. denied, 429 U.S. 823 (1976), in which this Court held
that federal agents did not engage in an "interception," under parallel
provisions of the federal wiretapping statute, when they seized and played
a previously-made tape recording of a private conversation.

The court awarded Steve Jackson Games approximately $51,000 in compensatory
damages under the Privacy Protection Act. R.E. 2:1213; R.E. 3:2. The court
found that none of the individual plaintiffs suffered any compensatory
damages. R.E. 2:13-14. However, the court awarded each of the individual
plaintiffs $1,000 in statutory damages under Title II of the ECPA. R.E.
2:14; R.E. 3:2.



9


The plaintiffs now appeal, seeking approximately $54,000 in additional
statutory and compensatory damages.

                       SUMMARY OF ARGUMENT

1. The district court correctly determined that the defendants' seizure of
unread e-mail messages stored on the BBS computer's hard disk was governed
by Title II of the ECPA rather than Title I, as the plaintiffs contend.
Title II prohibits unauthorized access, and obstruction of authorized
access, to electronic communications in storage on electronic
communications services. Access to unread e-mail messages stored on a BBS
computer falls squarely within the scope of Title II. In contrast, the
plaintiffs' claim that such access constitutes an "interception" of the
messages under Title I is contrary to the language, structure, and
legislative history of the ECPA, as well as this Court's interpretation of
the "interception" provision in United States v. Turk, 526 F.2d 654 (5th
Cir.), cert. denied, 429 U.S. 823 (1976).

2. Steve Jackson and Steve Jackson Games claim to be entitled to
approximately $3,000 and $1,000 in additional damages, respectively. It is
unclear from the record whether Steve Jackson suffered uncompensated
damages or, if so, how much. In contrast, it appears that Steve Jackson
Games is entitled, as claimed, to an additional $1,000.



10


                            ARGUMENT

I.   The seizure of Unread Electronic Mail Messages stored In
The Company's BBS Computer Is Governed by Title II, not
Title I, of the Electronic Communications Privacy Act

During the search and seizure that gave rise to this litigation, the Secret
Service seized a computer containing unread private e-mail messages, which
previously had been transmitted electronically to the computer and were
stored as files on the computer's hard disk at the time of the seizure. The
question presented by this appeal is not, as the plaintiffs suggest,
whether this unread e-mail was protected by the Electronic Communications
Privacy Act (ECPA). Instead, the question is which provisions of the ECPA
apply. The plaintiffs assert that the seizure of unread e-mail messages
constitutes an "interception" of the messages under Title I of the ECPA,
even when the seizure occurs after the messages have been transmitted and
while they are being stored in computer files. But it is Title II, not
Title I, that governs the seizure of stored electronic communications such
as unread e-mail messages. The plaintiffs already have recovered damages
under Title II; they are not entitled to an additional recovery for the
same government actions under Title I.

A. The ECPA was enacted in 1986 as an amendment to Title III of the Omnibus
Crime Control and Safe Streets Act of 1968, the federal wiretapping
statute. See Pub. L. No. 99-508, 100 Stat. 1848-73 (1986). Prior to the
enactment of the ECPA, the wiretapping statute regulated the "interception"
of "wire or oral communication[s]." 18 U.S.C.  2511(1)(a) (1982). The
wiretapping



11


statute defined "interception" as "aural acquisition" (id.  2510(4)
(1982)), and therefore "only applie[d] where the contents of a [wire or
oral] communication c[ould] be overheard and understood by the human ear."
Senate Report at 2, reprinted in 1986 USCCAN at 3556. The ECPA was enacted
to extend the provisions of the wiretapping statute to electronic
communications, "in light of dramatic [intervening] changes in new computer
and telecommunications technologies." Id. at 1, reprinted in 1986 USCCAN at
3555.

The ECPA consists of two principal titles. Title I extends the basic
protections of the wiretapping statute from wire and oral communications to
electronic communications. As amended by Title I, the wiretapping statute
now prohibits the unauthorized interception of any "wire, oral, or
electronic communication." 18 U.S.C.  2511(1)(a).   The statute defines
"interception" to encompass "aural or other acquisition" (id.  2510(4)),
thereby making it illegal to intercept the non-voice as well as voice
components of wire, oral, and electronic communication. See Senate Report
at 13, reprinted in 1986 USCCAN 3567.

Title I contains exceptions for various forms of government interceptions. 
  See 18 U.S.C.  2511(2)(a)(ii), 2511(2)(b), 2511(2)(e)-(f), 2516. In
particular, Title I permits the government to apply to a federal court for
"an order authorizing or approving the interception of electronic
communications * * * when such interception may provide or has provided
evidence of any


5The ECPA also contains a third title, which addresses pen registers and
"trap and trace" devices. See 18 U.S.C.  3121-26. That title is not
relevant to this case.



                              12


Federal felony." Id.  2516(3). However, Title I imposes a number of
procedural and substantive conditions on the availability and scope of an
interception order. Id.  2518.

At the same time that Congress was enacting Title I of the ECPA to extend
the reach of the wiretapping statute's interception provisions to
electronic communications, it "also recognize[d] that computers are used
extensively today for the storage and processing of information." Senate
Report at 3, reprinted in 1986 USCCAN at 3557. Congress noted that, among
other things, "providers of electronic mail create copies of private
[e-mail] correspondence for later reference." Ibid. Congress therefore
added Title II of the ECPA to "address[] access to stored wire and
electronic communications and transactional records," a subject that the
wiretapping statute had not previously addressed.

As a general matter, Title II makes it unlawful for any person to engage in
unauthorized access of "a facility through which an electronic
communication service is provided" and thereby "obtain[], alter[], or
prevent[] authorized access to a wire or electronic communication while it
is in electronic storage in [the] system * * * ." 18 U.S.C.  2701(a).
"Electronic storage" is defined as "any temporary, intermediate storage of
a wire of electronic communication incidental to the electronic
transmission * * * ." Id.  2510(17)(A), 2711(1).

Title II's general prohibition against accessing stored electronic
communications is subject to an exception for government access. Id. 
2701(c)(3), 2703. However, government access under



13


Title II is conditioned on a variety of procedural and substantive
requirements. Id.  2703. For example, if law enforcement officials seek
the contents of an electronic communication that has been stored in an
electronic communications system for 180 days or less, they may obtain
access only pursuant to a warrant under the Federal Rules of Criminal
Procedure or an equivalent state warrant. Id.  2703(a).

The application of Title I and Title II of the ECPA to unread private
e-mail messages is straightforward. If the government acquires an unread
e-mail message while it is being transmitted electronically from one
computer to another, the government "intercepts" the message (18 U.S.C. 
2511(1)(a)) and is subject to the procedural and substantive requirements
of Title I. In contrast, if the government seeks access to the e-mail
message when it is stored on a BBS computer, or prevents the message's
addressee from obtaining access to the message, it is "obtain[ing] * * * or
prevent[ing] authorized access to [the] communication while it is in
electronic storage in [the] system" (18 U.S.C.  2701(a)), and the
government's actions are subject to the procedural and substantive
requirements of Title II.

B. The district court properly gave effect to the distinction between Title
I and Title II when it applied the ECPA to the government's seizure of the
unread e-mail messages in this case. As explained above, the Secret Service
did not acquire the contents of unread e-mail messages during their
transmission between the users' computers and the BBS computer. Instead,
the Secret Service



14


seized the messages stored on the computer's hard disk and (so the court
found) read and deleted some of the messages. The district court therefore
correctly held that the seizure of unread e-mail messages in the BBS
computer fell squarely within the scope of Title II of the ECPA, not the
distinct provisions of Title I.

Because the government's seizure of the unread e-mail messages was subject
to the requirements of Title II, and because the government is not
contesting the district court's holding that the government failed to
comply with those requirements, the plaintiffs are not appealing to
establish the illegality of the government's actions. Instead, they are
seeking the larger statutory damages ($10,000 per plaintiff) available
under Title I. Unfortunately for the plaintiffs, their Title I claim cannot
be reconciled with the structure, language, and legislative history of the
ECPA.

The first problem with the plaintiffs' claim is that, if accepted, it would
produce an unjustifiable collision between Title I and Title II. As
explained above, unread e-mail messages stored on a BBS computer are
plainly covered by Title II. But if the plaintiffs' theory were adopted,
they would be covered by Title I as well. Government access to unread
e-mail messages therefore would be simultaneously subject to the distinct
and different procedural and substantive requirements of Title I and Title
II. The plaintiffs point to no evidence that Congress meant for Title I and
Title II to intrude on each other in this fashion. To the contrary, the
legislative history of the ECPA, like the structure of the legislation,
treats Title I and Title II as distinct and complementary, rather than
overlapping, protections for electronic communications. See Senate Report
at 1-3, 11-45, reprinted in 1986 USCCAN at 3555-57, 3565-99.

The plaintiffs attempt to avoid placing Title I and Title II in conflict by
suggesting (e.g., Brief at 13) that an unread e-mail message on a BBS
computer is not covered by Title II. But that suggestion is plainly
incorrect. By its terms, Title II applies to any "wire or electronic
communication while it is in electronic storage" (18 U.S.C.  2701(a)), and
"electronic storage" is defined as "any temporary, intermediate storage of
a wire or electronic communication incidental to the electronic
transmission thereof" (id.  2510(17)(A)). The storage of unread e-mail
messages on a BBS computer's hard disk is a "temporary, intermediate
storage of a[n] * * * electronic communication incidental to the electronic
transmission thereof," and thus fits squarely within the statutory
definition of "electronic storage." See Senate Report at 16, reprinted in
1986 USCCAN at 3570 ("[S]ection 2701's prohibitions against unauthorized
access to wire or electronic communications while they are in electronic
storage would prohibit unauthorized access to such a communication while it
is stored on magnetic tape or disk.").

In addition, as the district court noted, the plaintiffs' Title I theory
cannot be reconciled with this Court's decision in United States v. Turk,
supra. In Turk, law enforcement officials seized and played a tape
recording of a private telephone conversation that had been made by one of
the conversation's participants.



16



The tape recording led to the prosecution and conviction of the other
participant. On appeal from his conviction, he claimed that the law
enforcement officials committed an unauthorized "interception" of the
conversation under the federal wiretapping statute when they seized and
played the tape recording. 526 F.2d at 657.

This court squarely rejected that claim, holding that no "interception"
occurs under 18 U.S.C.  2511 "when the contents of a communication are
revealed through the replaying of a previous recording." 526 F.2d at 659.
Looking to the structure and legislative history of the statute, this court
concluded that "the act of surveillance[,] and not the literal 'aural
acquisition' (i.e., the hearing), * * * was at the center of congressional
concern." Id. at 658, 659. The court therefore interpreted "interception"
under 18 U.S.C.  2511 to mean the contemporaneous acquisition of a
communication. Ibid.

The plaintiffs evidently concede that, under Turk, the seizure of e-mail
messages that already have reached (i.e., been read by) their addressees is
not an "interception." However, they argue (Brief at 14) that Turk does not
apply where, as here, the government's actions prevent an electronic
communication from reaching its intended recipients. But nothing in the
statutory language or legislative history suggests that the receipt of
electronic communications is a concern of Title I. Instead, the central
concern of Title I, and the wiretapping legislation that it amends, is
protecting private communications from the unauthorized scrutiny of
outsiders, regardless of whether that scrutiny disrupts



17


the communication. To take a classic example, an unauthorized wiretap is an
"interception," yet it places no obstacle in the way of the tapped
conversation, and indeed, would be self-defeating if it did. Conversely,
electronically "jamming" a wire or electronic communication would not
constitute an "interception," despite the fact that the jamming prevented
the communication from reaching its intended recipient, because the
statutory definition of "interception" requires an "acquisition of the
contents" (18 U.S.C.  2510(4)). In short, whether a third party prevents a
communication from reaching its intended target is irrelevant to whether an
"interception" has occurred.

In contrast, preventing access to a stored electronic communication is one
of the central concerns of Title II. By its terms, Title II applies not
only to persons who "obtain[]" stored electronic communications, but also
to persons who "prevent[] authorized access" to those communications. 18
U.S.C.  2701(a). Thus, the unauthorized destruction of unread e-mail
messages falls squarely within the purview of Title II -- further
confirmation that Title II, not Title I, provides the governing law in this
case.

As an alternative way of avoiding Turk, the plaintiffs argue (Brief at
14-15) that Turk's reading of "interception" has been superseded, at least
with respect to electronic communications, by the enactment of Title I of
the ECPA. But the legislative history makes clear that Congress did not
change the statutory definition



18


of "interception" in any respect that is relevant to this case when it
enacted Title I. As explained in the Senate Report:

* * * [T]he Electronic Communications Privacy Act amends the definition of
the term "intercept" in current section 2510(4) of title 18 to cover
electronic communications. The definition of "intercept" under current law
is retained with respect to wire and oral communications except that the
term "or other" is inserted after "aural" * * * [to] clarif[y] that it is
illegal to intercept the non-voice portion of a wire communication. [Senate
Report at 13, reprinted in 1986 USCCAN at 3567].

The point could hardly have been made more clear: apart from including
electronic communications and protecting "the non-voice portion of a wire
communication," "[t]he definition of 'intercept' under current law is
retained" (emphasis added). Thus, far from modifying or superseding Turk's
interpretation of "interception," Congress left that interpretation
undisturbed.

The plaintiffs argue (Brief at 14-15) that the legislative history of the
ECPA shows that Congress meant to provide protection to BBS systems and,
more specifically, that Title I "contemplated preventing the interception
of BBS e-mail." We have no quarrel with the proposition that the
interception of unread e-mail messages is subject to Title I. But the
question here is not whether Title I regulates interception of unread
e-mail messages, but what constitutes an "interception" under Title I. As
the foregoing discussion shows, the seizure of unread e-mail messages
stored on a computer's hard disk simply is not an "interception" under
Title I, but instead is governed by the provisions of Title II. And because
the seizure of such e-mail messages is subject to Title II, the district
court's rejection of the plaintiffs' Title



19


I claim does not, as the plaintiffs assert (Brief at 15), "do violence to
the ECPA's inclusion of bulletin board communications within its scope."

II.  Further Proceedings Are Required Regarding The Damage
Award To The Company And Its Owner

Steve Jackson and Steve Jackson Games argue that the district court's
calculation of damages was incorrect in two minor respects. First, Steve
Jackson claims (Brief at 17) that he is entitled to approximately $3,000 in
compensatory damages under the Privacy Protection Act. Second, Steve
Jackson Games claims (Brief at 18) that it is entitled to $1,000 in
statutory damages under Title II of the ECPA. The first of these claims is,
at most, inaccurate. The second claim, in contrast, appears to be correct.

A. Steve Jackson's claim for compensatory damages rests on the theory that
he lost royalty payments as a result of the search and seizure in this
case. The district court found that Steve Jackson Games suffered
approximately $100,000 in lost sales during 1990. R.E. 2:13. Steve Jackson
asserts that he received a 3 percent royalty on sales of "his products"
(Brief at 17) by Steve Jackson Games, and hence would have personally been
paid 3 percent of the company's lost sales.

It is unclear from the record whether Steve Jackson has, in fact, suffered
any uncompensated loss of royalties.6 If he has,


6The district court awarded Steve Jackson Games approximately $42,000 in
lost profits, based on a finding that the company received a 42 percent
profit on its sales. R.E. 2:13. The district court evidently derived the 42
percent profit figure from a report prepared by the plaintiffs' economic
expert, who calcu-(continued...)



20


however, his losses clearly were less than $3,000. In the proceedings
below, Steve Jackson submitted an expert's report stating that he received
two different kinds of royalty payments: a 3 percent royalty for sales of
products that he wrote, and a 1 percent royalty for sales of other
publications. Supp. R.E. 1:2. As a result, how much royalties he lost
depends on what percentage of the company's lost sales was attributable to
his products and what percentage was attributable to the company's other
products. The district court made no finding on that question, but Steve
Jackson himself claimed only that his products accounted for half of the
company's lost sales. Id. at 2-3. As a result, at most, Steve Jackson would
be entitled to 3 percent of half of the lost sales, and only 1 percent of
the rest. A remand is required to determine exactly how much, if any, lost
royalties should be awarded.7

B. Steve Jackson Games appears to be correct that it is entitled to $1,000
in statutory damages under Title II of the ECPA. Title II provides that
"any provider of [an] electronic communications service * * * aggrieved by
any [knowing or intentional]

6 ( . . . continued)
lated that the company enjoyed a 42 percent "historical gross profit
percentage." Supp. R.E. 2:6. However, the report does not make clear
whether the 42 percent "gross profit" figure takes into account royalty
transfers between the company and Steve Jackson. If the 42 percent figure
is a "pre-royalty" figure, then the district court's calculation of damages
for Steve Jackson Games effectively required the defendants to pay for
Steve Jackson's lost royalties, and merely assigned the royalties to the
company rather than Steve Jackson -- a harmless error, since Steve Jackson
is the sole owner of the company.

7Given the small magnitude of the sums involved, the defendants would hope
that this matter ultimately could be resolved without further litigation.


violation of [Title II]" is entitled to recover $1,000 in statutory
damages. 18 U.S.C.  2707(a), 2707(c). The district court found that the
defendants violated Title II with the requisite mens rea, and the court
held that all plaintiffs, including Steve Jackson Games, were "aggrieved"
by the violation within the meaning of the statute. It therefore appears
that Steve Jackson Games is entitled to an additional award of $1,000 under
Title II.


                           CONCLUSION

For the foregoing reasons, the judgment of the district court should be
affirmed in part and vacated and remanded in part.

                              Respectfully submitted,

                              FRANK W. HUNGER
                                Assistant Attorney General

                              JAMES H. DeATLEY
                                United States Attorney

                              BARBARA L. HERWIG
                              SCOTT R. McINTOSH
                                Attorneys. Appellate Staff
                                Room 3127  Department of Justice
                                Washington, D.C.  20530
                                (202) 514-4052
April 11, 1994









8We note, however, that the result will be separate awards of statutory
damages to the company and its sole shareholder, neither of whom was found
to have suffered any compensable damages as a result of the violation of
Title II. Given the practical identity of interests between the company and
its owner, it could be questioned whether the statute contemplates this
kind of duplicative award.



                               22


CERTIFICATE OF SERVICE
I hereby certify that on April 11, 1994, I served the foregoing BRIEF FOR
THE APPELLEES by mailing true copies, postage prepaid, to:

Peter Kennedy
George, Donaldson & Ford
1000 Norwood Tower
114 W. 7th Street
Austin, TX 78701

Shari Steele
Electronic Frontier Foundation
Suite 950 East
1001 G Street, N.W.
Washington, D.C. 20001




                             Scott R. McIntosh