Alan R. Friedman, Brendan M. Schulman and Samantha V. Ettari
Alan R. Friedman, Brendan M. Schulman and Samantha V. Ettari ()

Last month, the U.S. Court of Appeals for the Second Circuit issued a significant decision in U.S. v. Ganias overturning a criminal tax evasion conviction because the government had retained electronically stored information (ESI) for too long after the execution of a search warrant and then improperly searched and used that ESI in a case unrelated to the warrant from which it was procured.1 The majority decision, authored by Judge Denny Chin, held that the government’s conduct violated the defendant’s Fourth Amendment rights and that the ESI should have been suppressed, and vacated the conviction.

The Initial Search Warrant

When executing a search warrant, the government does not always seize data sources such as hard drives or conduct on-site reviews for relevant ESI, but instead increasingly makes mirror images—identical copies—of those sources for later review. This allows the government to assure that it takes all relevant and responsive ESI—including metadata, native files, and any data that may be fragmented across the systems or drives—in a pristine state for methodical forensic examination and retrieval of all ESI responsive to the warrant. Once that ESI is segregated, however, the non-responsive ESI is not always destroyed or returned. Sometimes, as happened in Ganias, it is retained indefinitely.

In 2003, the Criminal Investigative Command of the Army, acting on a tip, obtained several search warrants relating to an investigation into two companies for allegedly, among other things, billing the Army for work not done. One warrant called for the search of the offices of the companies’ accountant—Stavros Ganias. Ganias’ computers were not seized; instead, forensic mirror images were made of three computers, including files beyond the scope of the warrant, for later review. Ganias, present at the search, vocalized concern over the scope of the seizure and was assured by agents that non-responsive ESI would be purged later.

Investigators maintained Ganias’ ESI (and other ESI resulting from the warrants) on two sets of 19 DVDs. They began their review and segregation eight months later and completed the process five months thereafter, approximately 13 months after the original seizure. By that time, the government had segregated and extracted ESI relevant to the initial search warrants, but did not purge or destroy the remaining non-relevant ESI.

The Second Search Warrant

Approximately 20 months after the initial search warrant was executed, the government began to suspect Ganias of criminal tax violations and, in July 2005, expanded its investigation. After receiving no response from Ganias to a request to access certain of his personal files, the government obtained a second search warrant to search the preserved ESI collected under the initial warrant, which, by that time, the government had possessed for almost 21/2 years.

Ganias was indicted and sought to suppress the ESI collected under the initial search warrant. The trial court denied the motion, and Ganias was subsequently convicted.

Second Circuit Holding

On appeal, the Second Circuit held that the Fourth Amendment did not permit officials executing a warrant for the seizure of particular data on a computer to indefinitely retain every file on that computer for use in future criminal investigations. The decision directly addressed the challenges and impact technology has had on the development of Fourth Amendment privacy jurisprudence: “Because the degree of privacy secured to citizens by the Fourth Amendment has been impacted by the advance of technology, the challenge is to adapt traditional Fourth Amendment concepts to the government’s modern, more sophisticated investigative tools.”

This exact concern and mandate was expressed less than a week later by the Supreme Court in its recent June 25, 2014, decision in Riley v. California.2 There, the Supreme Court held that Fourth Amendment privacy over cell phone content trumped most of the exemptions that allowed warrantless searches incident to arrest. Writing for a united court, Chief Judge John Roberts opined: “Modern cell phones, as a category, implicate privacy concerns far beyond those implicated by the search of a cigarette pack, a wallet, or a purse.”

In Ganias, Judge Chin wrote that the Fourth Amendment afforded modern computer files the same protections as other materials seized, noting that in traditional, non-ESI seizures the government is rarely allowed to remove all of an individual’s papers for later review because that would violate the mandate of the warrant, which must state with particularity the areas to be searched and the items to be seized. “These Fourth Amendment protections apply to modern computer files. Like 18th Century ‘papers,’ computer files may contain intimate details regarding an individual’s thoughts, beliefs, and lifestyle, and they should be similarly guarded against unwarranted government intrusion.” But the court recognized that modern computers—hard-drives, servers, and networks—contain “massive volumes of information” and “present logistical problems” in the execution of a search warrant.

The Ganias decision suggests that in most circumstances, the government’s practice of imaging hard drives for later review and segregation of relevant ESI may be acceptable. Given the burden or impracticality of many onsite reviews, Chin wrote that “the creation of mirror images for offsite review is constitutionally permissible in most instances, even if wholesale removal of tangible papers would not be” and noted that the Federal Rules of Criminal Procedure contemplated such review in certain circumstances.3

However, the Constitution does not allow the government’s indefinite retention of the ESI outside the scope of the original warrant, once the review and segregation of ESI are concluded. Such retention was deemed by the court to be “a meaningful interference with Ganias’ possessory rights in those files and constituted a seizure within the meaning of the Fourth Amendment.”

The Second Circuit rejected the government’s argument that once it had made mirror images of the hard-drives those images were “the government’s property.” That argument did not “justify the indefinite retention of non-responsive documents.” It also rejected the argument that the second search warrant cured any defect in the search. “If the government could seize and retain non-responsive electronic records indefinitely, so it could search them whenever it later developed probable cause, every warrant to search for particular electronic data would become, in essence, a general warrant.”

The court found unpersuasive a third argument that the ESI no longer existed, due to Ganias’ altering the content of his computer after the initial search warrant was executed, and as a consequence, a second seizure of Ganias’ ESI pursuant to the second warrant would not have captured the relevant ESI. This loss of relevant information was a risk the Fourth Amendment framework contemplates: “the Fourth Amendment clearly embodies a judgment that some evidence of criminal activity may be lost for the sake of protecting property and privacy rights.”

The decision also rejected arguments that complete destruction of the non-relevant ESI would “compromise the remaining data” and that Ganias was procedurally barred from seeking to suppress the ESI on these grounds because he did not make a Rule 41(h) motion, holding that such a motion was unnecessary in this context.

The court reversed the trial court’s ruling on the suppression motion, holding that the search of the unreasonably and impermissibly retained ESI warranted the application of the exclusionary rule. The “good faith” exemption did not apply since the government’s proposition that the mirror images were its “property” was “not reasonable” and because certain agents had stated initially that the non-relevant ESI would be purged. Moreover, the benefits of deterrence in excluding the ESI were deemed to be “great,” given the increasingly common government practice of making mirror images of hard-drives and other ESI and then reviewing the material later, off-site. Chin noted: “deterring [the government's] unconstitutional handling of non-responsive data has grown in importance.”

Judge Peter Hall concurred in part, agreeing that the retention of the non-responsive ESI was a Fourth Amendment violation, but dissented because he did not agree that the evidence should be suppressed.

Jury Use of Social Media

Ganias also raised on appeal certain jurors’ improper use of social media during trial. It is noteworthy that, although the Second Circuit did not deem this a Sixth Amendment violation justifying reversal, the decision addressed the problems that arise from juror use of social media and suggested a prophylactic measure.

In Ganias, one juror posted a number of trial-related comments to his Facebook page immediately prior to its commencement and during trial, such as, “Jury duty 2morrow. I may get 2 hang someone…can’t wait,” “Jury duty sucks!” and “Guiness [sic] for lunch break. Jury duty ok today.” That juror also “friended” another juror.

While the Second Circuit noted that “[a] juror who ‘friends’ his fellow jurors on Facebook, or who posts comments about the trial on Facebook, may, in certain circumstances, threaten a defendant’s Sixth Amendment right to an impartial jury,” that was not the case in Ganias, given the content of the Facebook posts. The court endorsed the use of model jury instructions proposed by the Judicial Conference Committee on Court Administration and Case Management that would include the following instruction:

You may not communicate with anyone about the case on your cell phone, through e-mail, Blackberry, iPhone, text messaging, or on Twitter, through any blog or website, through any internet chat room, or by way of any other social networking websites, including Facebook, My Space, LinkedIn, and YouTube.

Similar instructions were suggested for the close of the case. The court admonished that “it would be wise for trial judges to give the committee’s proposed instructions both at the start of trial and as deliberations begin, and to issue similar reminders throughout the trial before dismissing the jury each day.”

Conclusion

Ganias establishes strict parameters for the government on retention of ESI and bars them from revisiting ESI captured under an unrelated search warrant for use in later investigations. Moreover, it provides useful guidance in the increasingly fraught area of social media use by jurors.

Alan R. Friedman is a partner, Brendan M. Schulman is special counsel, and Samantha V. Ettari is an associate, at Kramer Levin Naftalis & Frankel.

Endnotes:

1. U.S. v. Ganias, 2014 WL 2722618 (2d Cir. June 17, 2014).

2. Riley v. California, S. Ct., 2014 WL 2864483 (June 25, 2014).

3. See Fed. R. Crim. Proc. Rule 41(e)(2)(B).