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Case law in 2004 in the area of Internet communications shared something incommon with the hurricane season that recently ended: It has been an unusuallyactive year. Before 2004, decisions interpreting the Electronic Communications Privacy Act of1986 and related federal statutes were few and far between. Considering thecomplexity of these statutes, the paucity of case law is not surprising. At least two federal circuit courts have readily acknowledged the difficultiesin interpreting these statutes. In fact, the very first decision to attempt tobroach the implications of the federal Wiretap Act and the ElectronicCommunications Privacy Act as they related to Internet communications describedthis treacherous area of the law as “famous (if not infamous) for its lackof clarity,” in Steve Jackson Games, Inc. v. U.S. Secret Service, 36F3d 457, 462 (5th Cir., 1994). The 9th U.S. Circuit Court of Appeals, in U.S. v. Smith, 155F3d 1051, 1055 (1998), cert den, 525 US 1071, subsequently opined that the 5thCircuit in Steve Jackson Games “might have put the matter too mildly … indeed, the intersection of the Wiretap Act and the Stored CommunicationsAct is a complex, often convoluted, area of the law.” If two disparate federal courts so candidly admit to how confusing it is toapply these statutory provisions to real-life scenarios, it is not surprisingthat attorneys have been slow to recognize the presence of issues to litigatewhen these statutes have been violated. That trend, however, may be coming to an end. So far in 2004, there have been atleast three major court decisions issued interpreting under what circumstancessomeone other than the participants to a computer communication may acquireinformation pertaining to that communication. Each of these decisions contain rulings and language that carry seriousimplications on how such information will or will not be revealed tonon-participants in computer communications in the future. ‘COUNCILMAN’ Arguably the most significant of the cases decided this year is U.S. v.Councilman, 373 F3d 197. A review of the facts of the case demonstrates theserious struggle between the law and technology. The defendant was the vice president of an online book distributing company,which also provided an e-mail service to some of its book-dealing customers. The defendant allegedly instructed some of his company’s employees to write acomputer program that searched all incoming e-mails sent by Amazon.com to any ofthe customers of the company’s e-mail service. Once such e-mails from Amazon.comwere spotted by the computer program, rather than forward them to the place inthe company’s computer network where its customers’ “in box” waslocated, they were redirected to another area of the computer system so thee-mails could be read by employees. This entire process of redirecting Amazon.com’s e-mails intended for thecompany’s customers was allegedly done to provide the defendant’s company acompetitive advantage because the company could see what offers were being madeby Amazon.com to the company’s customers before the e-mails actually reached thecustomers. The court’s decision does not indicate if these e-mails wereeventually forwarded to their intended recipients after they were read byemployees. The defendant was charged with one count of conspiracy to violate the federalWiretap Act in that he conspired to intercept and use the contents of thesee-mails and caused such e-mails to be transmitted to people other than theintended recipients. Last year, the District Court of Massachusetts granted defendant’s motion todismiss the conspiracy count against him in U.S. v. Councilman, 245FSupp2d 319. In June, a three-judge panel of the 1st Circuit upheld thedismissal on appeal, with one judge dissenting. Before explaining the reasonsfor this dismissal, however, certain key statutory provisions in the WiretapAct, parts of which were amended when the Electronic Communications Privacy Actwas enacted in 1986, must be understood. There is an important distinction to be found in the definitions of “wirecommunication” and “electronic communication” under federal law.A “wire communication” involves any transfer, involving the humanvoice, by “the aid of wire, cable or other like connection” including”any electronic storage of such communication,” 18 USC 2510(1). Incontrast, an “electronic communication” involves the transfer of any”signs, signals, writing, images, sound, data, or intelligence of anynature,” basically meaning any transfer of information or data notcontaining the human voice, 18 USC 2510(2). The statute defining “electronic communication,” however,significantly omits the reference to electronic storage that appears in thedefinition of “wire communication.” This omission was critical to the 1st Circuit’s holding in Councilman.The court cited U.S. v. Hart, 328 F3d 45, 49 (1st Cir, 2003), for theproposition that when Congress enacts two statutory provisions as closelyrelated as the definitions of “wire communication” and”electronic communication” and omits from the latter a term (such as”electronic storage”) that is contained in the former, “it isgenerally presumed that Congress acts intentionally and purposely in thedisparate inclusion or exclusion.” ELECTRONIC STORAGE Looking at the definition of “electronic storage” in 18 USC2510(17)(A) reveals that the term includes “any temporary, intermediatestorage … incidental to the electronic transmission thereof.” Hence,the term “electronic storage” includes, according to the 1stCircuit, not only the final resting place where the electronic communication isintended to complete its journey from sender to recipient, but any othertemporary resting place where an electronic communication may reside in acomputer system as it awaits being transmitted along the wires to its next stopin its journey from sender to recipient. Those who understand how the technologyof electronic communication works know an e-mail may make many temporary stops,or “hops,” along the path of transmission from sender to recipient. Turning this legal analysis to the facts of Councilman, both partiesstipulated to the fact that the e-mails sent by Amazon.com were intercepted oncethey had already arrived and were stored within the computer system ofdefendant’s company. The communications in question simply had not beenforwarded yet to the specific area of the company’s computer system where thecustomers accessed the e-mails. Therefore, the program the defendant had the employees create, the 1st Circuitfound, merely accessed these e-mails while they were already sitting in”temporary storage” within the company’s computer system. The computerprogram merely redirected those e-mails from their originally intended finaldestination of the portion of the company’s computer system made available tothe e-mail customers to another location in the system where employees couldread them. What the analysis in Councilman actually came down to, in the simplest ofterms, is the question of when is an e-mail considered, literally, “intransit” from sender to recipient and when is it in “electronicstorage.” As the 1st Circuit noted in its decision, the government triedto argue that what the defendant did in having the e-mails redirected whilesitting in temporary storage in the computer system was intercepting the e-mailwhile it was in “en route storage.” The government was, in essence,trying to equate such an interception of an electronic communication sitting intemporary storage, awaiting transmission to its final destination, asintercepting the communication “in transit.” The 1st Circuit appreciated the government’s analysis, but took a far moreliteral interpretation of what it means to intercept an e-mail “intransit.” The court reminded the parties that the stipulation of facts established thatthe computer program that re-routed the e-mails in question never”performed functions that affected the e-mails … while [they] were intransmission through wires or cables between computers,” implying thatunless the communication was intercepted as it was actually traveling from onecomputer to the next, there could be no violation of the Wiretap Act since thecommunication was not intercepted “in transit.” The 1st Circuit, however, did not stop there in limiting its evaluation of thelaw’s impact on Internet communications to the specific facts of this case. Indicta, it made one more chilling comment that could be a presage of how futuredecisions evaluate this entire area of law: “[w]e believe that the languageof the statute makes clear that Congress meant to give lesser protection toelectronic communications.” THE AFTERMATH The Councilman decision immediately received harsh criticism from anumber of directions. Stripping the facts of this case from the legaltechnicalities, it is easy to see the frustration caused by this decision. Assume Federal Express was sending flyers, sealed in envelopes, via the U.S.Postal Service, explaining how their services were far cheaper and moreefficient than those offered by the Postal Service. Clearly, the Postal Servicewould be unable to justify opening these envelopes while they sit in the postoffice awaiting pickup for delivery to their intended recipients (and,therefore, in “temporary storage”), just so that postal employeescould gain information on how a competitor is pricing comparable services. It isdifficult for most people to understand how our laws treat e-mail so differentlyfrom “snail mail.” Even the 1st Circuit in Councilman empathized with the practicaldifficulties created by its decision. It noted that the technology to accomplishthe redirection of e-mail performed at the defendant’s directions did not existat the time the applicable federal statutory protections were enacted, butreluctantly observed, “[i]t may well be that the protections of the WiretapAct have been eviscerated as technology advances.” The 1st Circuit went on to concede that under this very narrow definition ofwhen a communication is considered “in transit” (and, therefore, notin “electronic storage”) “few seizures [of electroniccommunications] will constitute interceptions under [the] Wiretap Act.” A reprieve may be on the horizon. In voting last month to rehear the matter enbanc, the circuit vacated the judgment. Oral arguments are scheduled for Dec. 8. CONCLUSION Many weather forecasters viewed the excessive hurricane activity of 2004 assimply an aberration and not a trend of patterns to come. Considering theincreasingly important role that Internet-related communications play in thedaily business and private lives of Americans, it should be safe to assume thatthe increasing attention given this area of the law by the courts is not anaberration, but a trend that will only dramatically increase. Stephen V. Treglia is an assistant district attorney in Nassau County, N.Y., and chief of the technology crime unit.

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