A federal appeals court in New York has agreed to hear anew an appeal that explores the contours of privacy in a digital age.
At the urging of one of their colleagues, a majority of judges on the 2nd Circuit U.S. Court of Appeals voted on June 29 to rehear an appeal filed by Stavros Ganias, an accountant from Wallingford, Connecticut who was convicted in 2011 of two counts of tax evasion and sentenced to 24 months in prison.
The ruling reopens an appeal decided in June 2014 by three judges of the court, who in a divided ruling vacated Ganias’ conviction after concluding that the government violated his Fourth Amendment rights when it retained files from his lawfully searched computers for more than two-and-a-half years and then searched them again when it later developed probable cause.
The case highlights a difference between searches of books or papers and searches of computers and other electronics, which can hold files that range from the professional to the personal and may encompass far more information about someone from whom the government seizes such devices than the warrant itself authorizes.
In deciding to review the ruling, the majority asked the parties and their allies to address two questions that the court will consider when it convenes for oral argument on Sept. 30.
“(1) Whether the Fourth Amendment was violated when, pursuant to a warrant, the government seized and cloned three computer hard drives containing both responsive and non-responsive files, retained the cloned hard drives for some two-and-half years, and then searched the non-responsive files pursuant to a subsequently issued warrant; and
(2) Considering all relevant factors, whether the government agents in this case acted reasonably and in good faith such that the files obtained from the cloned hard rives should not be suppressed.”
At issue is a prosecution that stemmed from Ganias’ work on behalf of a company that had been hired by the U.S. Army to provide security and maintenance services at a vacant facility in Stratford, Connecticut.
Based on a tip from a confidential source that the contractors had stolen copper wire and other equipment from the facility, in Nov. 2003 investigators from the Army obtained warrants to search several premises, including the offices that housed Ganias’ accounting firm.
There, pursuant to the warrant, the agents made identical copies of the hard drives of Ganias’ computers. Though the imaging also copied Ganias’ personal files—contained in programs such as QuickBooks and TurboTax—the agents assured Ganias they were looking only for materials that tied to the investigation. The following spring, after discovering suspicious payments by the contractor to a business owned by someone who had not reported any income from that business, the Army invited the IRS to join the investigation. Investigators from the Army gave the IRS copies of Ganias’ hard drives so that agents from the IRS could review the evidence.
By December, the agents from both the Army and IRS had extracted the files that tied to their investigation of the contractor. They knew the warrant did not authorize them to review other records retrieved from the hard drives. Still, they retained the files that had nothing to do with the investigation.
For its part, the IRS started to suspect that Ganias had failed to report the contractor’s income properly. In July 2005—about 20 months following the seizure of the hard drives—the IRS broadened its investigation to include possible tax fraud by Ganias. The agent in charge of the investigation did not review Ganias personal financial records, which she knew to be beyond the scope of the warrant.
The following February, the government asked Ganias and his attorney for permission to review Ganias’ personal files that had been copied from the hard drives. After Ganias did not respond, the IRS obtained a warrant to search the images of Ganias’ financial records seized in 2003. Because Ganias had revised the original files shortly after the Army copied the drives in 2003, the original records would not have existed absent the government’s retaining the images.
At trial, Ganias sought to suppress the computer files that became the subject of his appeal. Judge Alvin Thompson of the U.S. District Court in Hartford denied the motion, explaining:
“Here… where the searches and seizures were authorized by a magistrate judge, where government agents scrupulously avoided reviewing files that they were not entitled to review, and where the defendant had an alternative remedy pursuant to [a motion to return property] to avoid the complained of injury, i.e. that the government held his data for too long without returning or destroying it, the defendant has not shown that his Fourth Amendment rights were violated.”
On appeal, the court noted that the framers of the Constitution sought to end the practice of the British of searching the premises of opponents and seizing their papers, books and records indiscriminately pursuant to so-called general warrants. Consequently, the court noted, the Fourth Amendment requires that warrants will be available to the government only on a showing of probable cause and a description of the places to be searched and the items to be seized. According to Judge Denny Chin:
“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. If anything, even greater protection is warranted.”
The court observed that investigators who carry out a warrant may do so by making mirror images of the information stored on hard drives that the investigators can later review off-site. According to the court, the government must review the material within a reasonable period—there’s no one-size-fits-all rule—and that material is subject to exclusion from evidence when the government seizes items outside the scope of the warrant (a practice that starts to resemble a general warrant) and fails to act in good faith.
In the case of Ganias, the court concluded that the government had overstepped its authority. According to Chin, the government’s retaining Ganias’ records for two-and-a-half years interfered with his rights in those files.
“Without some independent basis for its retention of those documents in the interim, the government clearly violated Ganias’ Fourth Amendment rights by retaining the files for a prolonged period of time and then using them in a future criminal investigation,” wrote Chin, who rejected the government’s contention that it obtained a second warrant to search Ganias’ files.
“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,” he added.
The ruling, which vacated Ganias’ conviction, surfaces a tension between the reasonableness of a search—in this case the length of time the government retains records swept up in a search—and the need for the government to establish that it has not altered evidence in its custody. As the Harvard Law review noted in December:
“Although the court properly found that Ganias’ Fourth Amendment rights had been violated, the decision failed to appreciate the importance of authentication requirements for electronic evidence. As a result, Ganias may unnecessarily complicate prosecutions by potentially creating a perceived ‘right to deletion’—a prescription that federal prosecutors must delete files nonresponsive to a warrant sooner rather than later. The court could have avoided any potentially burdensome effects of this prescription on the evidentiary authentication process had it issued a more narrow ruling merely suppressing the evidence.”
The decision to reexamine the ruling also may tie to a question posed by Orin Kerr, a professor of criminal law and procedure at George Washington University who has commented on the case. “Is the real problem here that the government has over-seized and is taking unfair advantage of having extra stuff available to it, or is the real problem only that too much time has elapsed before the government is taking that advantage?” Kerr wrote in The Washington Post following Chin’s ruling.
Kerr suggests the same facts as Ganias except imagines the government developed probable cause for the second crime days after carrying out the first warrant. “Should that case come out differently?” he asks. “And if it could come out differently, is that because we intuit that the information for the second warrant likely is still… available on the original hard drive or because we think that the government’s seizure did not go on for so long as to become unreasonable?”
The first briefs are due by July 29.