Wednesday, November 19, 2003
Copyright © Las Vegas Review-Journal

FBI EAVESDROPPING: Court overrules LV judge

Company had to help intercept conversations

A Las Vegas judge erred when he ordered a company to help the FBI eavesdrop on conversations in a suspect's vehicle, a federal appeals court ruled Tuesday.

The 9th U.S. Circuit Court of Appeals issued the decision in a civil case involving Assistant U.S. Attorneys Eric Johnson and Kathleen Bliss, who spent more than two years working on a public corruption investigation with ties to strip club magnate Michael Galardi.

Bliss would not confirm that the decision stemmed from the Galardi investigation. The underlying civil case is sealed.

The appeal was filed in April 2002 by an unidentified company that runs a type of onboard system now found in some luxury cars.

That system allows the company to open a cellular connection to a vehicle and listen to conversations within the vehicle, a feature designed to help officials recover stolen cars.

The FBI obtained court orders requiring the company to help agents intercept conversations taking place in a car equipped with the system.

Tuesday's ruling does not identify the criminal case in which Senior U.S. District Judge Lloyd George issued the orders.

Las Vegas attorney Dominic Gentile, who represents former Clark County Commissioner Lance Malone, said his client and Galardi both drove a Hummer that was equipped with a system called OnStar. At different times during the criminal investigation, each of the men also owned the vehicle, Gentile said.

Malone, who worked as a lobbyist for Galardi, was indicted earlier this month with Clark County Commissioner Mary Kincaid-Chauncey and former Commissioner Dario Herrera.

Galardi has entered into plea agreements in which he admitted bribing public officials in Las Vegas and San Diego. Authorities allege Galardi used Malone as a middleman to make the payments.

The indictment cites at least four instances in which Malone met with other suspects in a car.

The indictment alleges one of the meetings occurred in Malone's car, which the document does not describe. At that January 2002 meeting, Malone and then-County Commissioner Erin Kenny discussed three issues affecting strip clubs. Kenny has pleaded guilty in the federal investigation and agreed to testify for the prosecution.

During a September 2001 meeting in an unidentified car, according to the indictment, Malone gave Herrera thousands of dollars in cash from Galardi.

Gentile and Las Vegas attorney Richard Wright, who represents Kincaid-Chauncey, said they would seek to suppress any evidence obtained from court orders that led to Tuesday's decision if they determine that the orders led authorities to intercept their clients' conversations.

"There's already a finding in the 9th Circuit that the order was unlawfully entered and unlawfully extended numerous times, so you've got a running head start on suppression," Wright said.

But Wright said the suppression of wiretap evidence requires a "substantial violation" of the federal wiretap law.

Houston defense attorney Douglas McNabb and other defense attorneys interviewed Tuesday said they knew of no other cases in which law enforcement had used an onboard system to intercept conversations of people who were lawfully occupying a vehicle.

"That is absolutely outrageous," McNabb said.

McNabb, who specializes in federal criminal cases, said he owns a Mercedes equipped with such a system.

"I never thought of it being used in that way," he said.

Dallas attorney Bennee Jones, who represents the company that filed the appeal, could not be reached for comment late Tuesday.

In reaching its 2-1 decision, the appeals court concluded that George's orders went too far in interfering with the service provided by the company.

According to the decision, written by Judge Marsha Berzon, the FBI's surveillance in this case disabled the system in the monitored car.

"The result was that the company could no longer supply any of the various services it had promised its customer, including assurance of response in an emergency," Berzon wrote.

Federal law requires communication service providers to furnish the government with any help necessary to accomplish an interception "unobtrusively and with a minimum of interference with the services" they provide.

According to the dissent, written by Judge Richard Tallman, "The FBI established to the district court's satisfaction the existence of probable cause to believe that individuals engaged in a continuing criminal enterprise were using the car as a venue for planning illegal activities."

Tallman argued that the law does not require the method of interception to allow the monitored communication service to continue without any interruption.

"Here, the record leaves no doubt that the company complied with the challenged order in the way least likely to interfere with its subscriber's services and that, in fact, no actual service disruption occurred," the judge wrote.

Tallman argued that the majority opinion "undermines an important investigative tool in a manner that defies common sense."

Bliss said she knows of no other court case that deals with the issue that led to Tuesday's opinion.

"We're going to read the opinion and digest it and consider whatever ramifications it might have and decide whether or not to seek further review," Bliss said.

She said any decision on further action would require Justice Department approval.

Johnson and Bliss were removed from the Galardi case in July for reasons unrelated to the wiretap controversy.

The opinion gives no hints regarding the nature of the criminal activity agents hoped to detect. The unusual level of secrecy is reflected in the way the case is styled: The Company v. United States of America.