United States v. Warshak, 631 F.3d 266 (6th Cir. 2010) is a criminal case decided by the United States Court of Appeals for the Sixth Circuit holding that government agents violated the defendant's Fourth Amendment rights by compelling his Internet service provider (ISP) to turn over his emails without first obtaining a search warrant based on probable cause. However, constitutional violation notwithstanding, the evidence obtained with these emails was admissible at trial because the government agents relied in good faith on the Stored Communications Act (SCA). The court further declared that the SCA is unconstitutional to the extent that it allows the government to obtain emails without a warrant. This case is notable because it is the first case from the United States Circuit Court of Appeals to explicitly hold that there is a reasonable expectation of privacy in the content of e-mails stored on third party servers and that the content of these emails is subject to Fourth Amendment protection.
Background
Facts Steven Warshak owned and operated Berkeley Premium Nutraceuticals, Inc. (Berkeley) which sold, among other products, an herbal supplement marketed as a pill for natural male enhancement, called Enzyte. His mother, Harriet Warshak, worked at Berkeley with him in the credit card department. In 2001, Berkeley launched Enzyte and by 2004, Berkeley's annual sales approached $250 million, in large part due to the success of Enzyte. Enzyte was marketed extensively, and approximately 98% of the advertising was done on television featuring a character known as "Smilin' Bob." In some advertisements, Berkeley presented false information. Phony surveys were presented as fact at Warshak's request, the customer satisfaction rating of 96% was fabricated according to Warshak's request, and even the medical professionals who Berkeley claimed developed Enzyte were fictitious. Sales of Berkeley's products occurred via telephone, email, and the Internet. Over the phone, Berkeley's sales force followed a script approved by Warshak designed to try to slip pertinent information past the customer. In the script, customers signing-up for a free trial were informed that they were being enrolled in an "auto-ship" program which would charge their credit card at the end of the first prescription period and send them a refill for their current prescription. To end this auto-shipping, customers had to opt out of the program. This program led to a large number of consumer complaints filed against Berkeley. The auto-ship program and customers' dislike for this practice resulted in many orders being canceled. The canceled orders hurt Berkeley's reputation among banks and credit card companies who became reluctant to extend credit to Berkeley. To combat this, Warshak invented various ways of reducing the apparent percentage of refunded charges through questionable tactics. One tactic was to charge the customer's account multiple times for the same purchase, once for the purchase of the supplement and another time for shipping. Warshak referred to this as "double dinging". Later, he instituted the practice of "triple dinging" as well. Additionally, to secure other lines of credit, Warshak, along with his mother Harriet, provided false information to banks. Much of the information about Warshak's questionable activities was contained in his email correspondence. In conjunction with a criminal investigation of Warshak and his questionable business practices, the government seized roughly 27,000 private emails from Warshak's ISP.
Procedural history On June 12, 2006, Warshak filed a claim against the United States seeking a declaratory judgment and injunctive relief. Warshak claimed that the compelled disclosure violated his Fourth Amendment rights. The district court filed a preliminary injunction which was affirmed by the Sixth Circuit, finding that Warshak had a privacy interest in the content of his emails. However, that decision was reviewed by an en banc panel of the Sixth Circuit and vacated on ripeness grounds. In September 2006, a grand jury in Ohio returned an indictment with more than 100 counts charging Warshak and his mother with various crimes including conspiracy to commit mail, wire, and bank fraud, mail fraud, bank fraud, and money laundering. Warshak moved before trial to exclude emails obtained from his ISP; which the court denied. In January 2008, the case went to trial. Six weeks later Warshak and his mother were convicted of a majority of the charges. Shortly thereafter, a jury found that certain assets were sufficiently related to the crimes such that Warshak was ordered to forfeit illegally obtained gains. In August 2008, the defendants were sentenced. Warshak received a prison term of 25 years, ordered to pay a fine of $93,000 and to forfeit the sums of $459,540,000 and $44,876,781.68 which represented the proceeds of the crimes. Harriet was sentenced to 24 months imprisonment and to be jointly and severally liable with Warshak for the forfeiture amounts. The defendants appealed their convictions, sentences, and forfeiture judgments resulting in the opinion discussed here.
Opinion of the court
Holding The court held that government agents infringed upon Warshak's Fourth Amendment rights when they compelled his ISP to produce the content of his emails without first obtaining a warrant based on probable cause. As the government agents operated in good faith on provisions of the Stored Communications Act, the exclusionary rule was not applicable and reversal of Warshak's convictions was not warranted.
Stored Communications Act (SCA) Under the SCA, agents of the government can request access to emails using an administrative subpoena or by obtaining a court order, depending on certain statutory classifications. Government agents ordered Warshak's ISP to store emails citing 18 U.S.C. § 2703(f) as granting them that authority. The government then ordered the ISP to turn over the content of Warshak's emails using a subpoena. Warshak was not informed that his ISP was archiving his email and he did not receive notice of the subpoena and order to his ISP until May 2006, nearly one year after the government served the subpoena.
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