Opinion
05 Mag. 1744 (DFE).
January 31, 2006
OPINION AND ORDER
On December 22, 2005, Intertex Apparel Ltd. served and filed a motion pursuant to Rule 41 (g) of the Federal Rules of Criminal Procedure, consisting of a Notice of Motion, a Declaration of Susan L. Stevens with Exhibits A, B and C, a Declaration of Michael S. Sommer, and a Memorandum of Law. On January 13, 2006, the Government served and filed a letter brief in opposition. On January 20, Ms. Stevens and AUSA Bret R. Williams faxed me their signed consent pursuant to 28 U.S.C. § 636 (c). On January 26, Intertex served and filed a Reply Memorandum of Law.
FACTUAL AND PROCEDURAL BACKGROUND
On October 14, 2005, AUSA Williams and Special Agent John Cianci of U.S. Immigration and Customs Enforcement ("ICE") presented me with Agent Cianci's affidavit in support of an application for a search warrant. The affidavit stated as follows. The Source of Information ("SOI") worked for Intertex during the Fall and Winter of 2004, was laid off by Intertex, filed a civil action against Intertex, and in or about May 2005 (through his attorney) contacted the commissioner of U.S. Customs and Border Protection by letter, alleging that Intertex had declared a false country of origin for articles it was importing into the United States in 2004. On August 3, 2005, the SOI met with law enforcement for an interview; he provided certain documents that he had apparently printed out from the Laptop Computer in his possession.
The information on the hard drive of the Laptop Computer is the focus of the motion now pending before me. The October 14 affidavit to me included the following:
22. At the conclusion of the [August 3, 2005] meeting, in addition to the documents described above and others, the SOI gave the Government the LAPTOP COMPUTER. According to the SOI, the LAPTOP COMPUTER is the property of INTERTEX, issued to the SOI for the SOI's use while SOI worked at INTERTEX, and contains both the documents and electronic mail communications described above as well as others.
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27. . . . Based upon the foregoing, I submit that there is probable cause to believe that the electronic contents of the LAPTOP COMPUTER and the computers which may be located within the TARGET PREMISES constitute evidence of violations of federal laws, including violations of Title 18, United States Code, Sections 541, 542, and 545.
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WHEREFORE, your deponent respectfully requests that a search warrant be issued, pursuant to Rule 41 of the Federal Rules of Criminal Procedure, authorizing Special Agents . . . to examine the contents of the LAPTOP COMPUTER, and to enter the PREMISES KNOWN AS 1400 BROADWAY, 18TH FLOOR, NEW YORK, NEW YORK (the "TARGET PREMISES") and to search for evidence, fruits and instrumentalities constituting violations of Title 18, United States Code, Sections 541, 542, and 545.
Similarly, an early portion of the October 14 affidavit said:
2. I make this affidavit in support of an application for a warrant to search (a) the premises known as 1400 Broadway, 18th Floor, New York, New York, located within the Southern District of New York (the "TARGET PREMISES"), and (b) a laptop computer now in the possession of ICE (the "LAPTOP COMPUTER") and seize any items set forth in Rider A attached hereto, . . .
Rider A specified 12 categories of property, but it did not mention the Laptop Computer. Rider A's heading said:
PROPERTY TO BE SEIZED AT THE PREMISES KNOWN AND DESCRIBED AS 1400 BROADWAY, 18TH FLOOR, NEW YORK, NEW YORK, AND ANY CLOSED CONTAINERS THEREIN
Similarly, the Laptop Computer was not mentioned in the search warrant prepared by AUSA Williams and signed by me.
On October 19, 2005, a team of Special Agents went to Intertex's Manhattan office and executed the search warrant. They seized numerous documents, plus 18 personal computers and four computer servers. They provided Intertex's counsel with copies of Rider A, and the search warrant, and the 20-page inventory describing the property seized from the premises. (Copies of those documents are now Exhs. A, B and C to the Stevens Declaration.) The agents inadvertently gave counsel a copy of the search warrant affidavit; the Government later requested its return, and counsel "either returned or destroyed all copies we could locate." (Stevens Decl., ¶ 2, n. 1.) By that time, counsel had read the affidavit and noted the passages about the Laptop Computer. (Intertex knows the name of the SOI, but I have decided not to name him in this Opinion.)
The Government has not disputed most of the statements in the Stevens and Sommer Declarations, including the following portions of the Stevens Declaration:
7. On November 1, 2005, the Government returned eleven personal computers. . . .
8. On November 29, 2005, I spoke by telephone to Agent Cianci. He told me that the Government would be returning the laptop computer (which he specifically identified as [the SOI]'s laptop); the seven personal computers which had been seized on October 19 and not returned on November 1; and certain other items. Agent Cianci told me that those items could be picked up only on November 30 or [Thursday] December 2, so I made arrangements to have them picked up by an outside vendor on November 30.
9. On November 30, I sent the outside vendor to pick up those [item]s from the Government. The Government gave the vendor the [remaining] seven personal computers which had been seized from Intertex's premises, but not the laptop computer which had been in [the SOI]'s possession.
10. I called Agent Cianci on November 29 [30?], 2005, and told him that the laptop had not been returned. Agent Cianci merely stated that he had not given it to the delivery service, and asked whom it belonged to. I told him that the laptop was the property of Intertex. Agent Cianci agreed to return the laptop on December 2, 2005.
11. I am informed by the vendor that, on December 2, Agent Cianci refused to return this laptop, claiming that its ownership was still in dispute.
12. I am informed by Michael S. Sommer, Esq. . . . that, on or about [Monday] December 5, 2005, he had a telephone conversation with Assistant U.S. Attorney Sheila Gowan in which he told her that . . . Agent Cianci was refusing to return the laptop; and that Intertex needed access to the laptop so that it could determine whether any of its employees had engaged in unlawful conduct and, if so, to take corrective measures. Ms. Gowan promised to get back to him.
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15. On December 7, 2005, I participated in a telephone call with Mr. Sommer and with Assistant United States Attorneys Sheila Gowan and Bret Williams. During this conversation, Ms. Gowan and Mr. Williams reiterated [a statement made earlier that day by Ms. Gowan] that they had returned the laptop to [the SOI] because it was owned by [the SOI]. . . . [Mr. Sommer] asked the Government to provide Intertex with a copy of the information it had copied from the laptop's hard drive. Ms. Gowan declined. . . .
On December 16, 2005, I held a telephone conference with Mr. Sommer, Ms. Stevens, AUSA Gowan and AUSA Lynn Neils; for about seven minutes of that conference, we patched in the SOI's attorney Jeffrey M. Gotlieb. Mr. Gotlieb stated as follows: The Laptop originally belonged to Intertex. Intertex fired the SOI and owes two weeks of back salary to the SOI. The Government returned the Laptop to the SOI; the Laptop's hard drive had problems before and after the Government possessed it; the SOI recently re-formatted the hard drive and may have deleted its contents. The SOI is now using the Laptop for his own purposes; it is old and worth very little; he would turn it over to Intertex if Intertex would pay him the two weeks of back salary that he claims is owed to him. I told Mr. Gotlieb that the Government had made a complete copy of the information on the hard drive before returning the Laptop to the SOI. I also told Mr. Gotlieb that I was giving him a chance to write me and tell me any reason why I should not order the Government to give Intertex a copy of the Government's copy. Mr. Gotlieb said he did not want to bother writing to me. After we ended the telephone connection with Mr. Gotlieb, AUSA Neils said that the Government was just as surprised as Mr. Sommer to hear that the SOI apparently deleted the contents of the Laptop's hard drive. Nevertheless, she continued to oppose giving Intertex a copy of the Government's copy of those contents.
DISCUSSION
In view of the December 16 statements of the SOI's attorney, it is clear that the SOI does not offer any reason why Intertex should not receive a copy of the information that was contained in the Laptop as of the time he turned it over to the Government.
Intertex's moving memorandum ends with three requests:
For the reasons stated, the Government should be ordered to return to Intertex any and all copies of the information it seized from the Laptop as the seizure of the Laptop was illegal. In the alternative, the Government should be ordered to return to Intertex a copy of the hard drive from the Laptop. Finally, Intertex should be awarded the attorneys' fees it incurred in making this Motion.
I have decided, for the reasons set forth below, to grant the second request and to deny the first and third requests.
The Government had "seized" the Laptop when the SOI handed it to the agents at the end of the interview on August 3, 2005. On October 14, 2005, the Government's affidavit asked me for a search warrant that would authorize it "to examine the contents of the LAPTOP COMPUTER." Yet it prepared a search warrant that did not mention the Laptop. During the next several weeks, it did examine the contents, and make a copy. Intertex's reply memorandum says at pages 3-4:
. . . the examination of the Laptop's hard drive was in itself a "search" within the meaning of the Fourth Amendment. . . . Because that search was not authorized by a warrant, it was illegal.
In Horton v. California, 496 U.S. 128, 137 n. 11, 110 S.Ct. 2301, 2308 n. 11 (1990), the Supreme Court said:
Even if the item is a container, its seizure does not compromise the interest in preserving the privacy of its contents because it may only be opened pursuant to either a search warrant or one of the well-delineated exceptions to the warrant requirement. [citations omitted]
Eleven days before the Government applied to me for the search warrant, Judge Cote wrote in United States v. Rudaj, 390 F.Supp.2d 395, 406-07 (S.D.N.Y. 2005):
The Government further argues that the Fourth Amendment permits the warrantless search of containers believed to contain incriminating evidence. This is not the law.
In the case at bar, it is unnecessary for me to decide whether the examination of the contents of the Laptop was illegal. Ever since the 1989 Amendments to Rule 41(e), now Rule 41(g), an order for the return of property may be granted "whether or not the search was lawful." In re Search of Office of Tylman, 245 F.3d 978, 980 (7th Cir. 2001). And even if a court were to find that there had been an illegal search of documents (whether in paper form or computerized form), it would not grant Intertex's first request (for the return of "any and all copies of information"). It would merely order the Government "to return copies" of the documents, while permitting it to retain a copy. Ibid. The Government would be able to use its retained copy for certain purposes, such as grand jury questioning, United States v. Calandra, 414 U.S. 338, 94 S.Ct. 613 (1974), impeachment and rebuttal, James v. Illinois, 493 U.S. 307, 311-14, 110 S.Ct. 648, 651-52 (1990).
I turn now to Intertex's second request, which was phrased as follows in its moving memorandum at page 5: "the Government can maintain a copy of the information it seized, and it can return a copy to the owner so that the owner may make use of that same information." The Advisory Committee Notes to the 1989 Amendments to Rule 41 say:
As amended, Rule 41(e) avoids an all or nothing approach whereby the government must either return records and make no copies or keep originals notwithstanding the hardship to their owner. . . . In many instances documents and records that are relevant to ongoing or contemplated investigations and prosecutions may be returned to their owner as long as the government preserves a copy for future use.
In his letter brief, at page 5, AUSA Williams argues that "Intertex has not shown it is entitled to lawful possession of the laptop." I disagree. Agent Cianci's October 14 affidavit, at Paragraph 22, said: "According to the SOI, the LAPTOP COMPUTER is the property of INTERTEX, issued to the SOI for the SOI's use while the SOI worked at INTERTEX, . . ." The Government has not disputed the portions of Ms. Stevens's Declaration quoted earlier in this Opinion: Agent Cianci said he would be turning over the Laptop to Intertex on November 30, and then on December 2; only on December 2 did he announce that the ownership of the Laptop was in dispute. During my December 16 telephone conference, the SOI's attorney made clear that the SOI's only reason for withholding the Laptop from Intertex was his claim for two weeks of back salary. And the SOI's attorney declined my offer that he write me and tell me any reason why I should not order the Government to give Intertex a copy of all of the information contained in the Laptop as of the time the Government possessed the Laptop.
The Government's letter brief quotes part of Mr. Sommer's Declaration, which says that Intertex has an interest in learning if violations of the law occurred at Intertex, and if so, by whom, so that corrective measures can be taken. The Government does not dispute that potential corrective measures might serve the public interest. It merely points out that corrective measures may or may not occur: "Intertex's counsel's obligation is to protect his client which fealty may run counter to the public's interest." I find that this possibility does not amount to a showing that the Government or the public interest will be subjected to any unreasonable risk if the Government provides a copy of its copy of the contents of the Laptop. The Advisory Committee's 1989 Notes say: "[R]easonableness under all of the circumstances must be the test. . . . [I]f the United States' legitimate interests can be satisfied even if the property is returned, continued retention of the property would become unreasonable." The Government trusted Mr. Sommer and his law firm to the extent of returning the 18 other computers and their contents. Under all the circumstances, I find that it would be unreasonable not to provide Intertex with a copy of the information contained in the Laptop as of the time the Government possessed the Laptop.
Finally, I turn to Intertex's third request, for damages in the form of the attorneys' fees it incurred in making this motion. If Agent Cianci had not retained a copy of the contents of the Laptop, then Intertex might have had the option of instituting a civil suit against him for damages pursuant to Bivens v. Six Unknown Named Agents of Fed. Bur. of Narc., 403 U.S. 388, 91 S.Ct. 1999 (1971). See Hallock v. Bonner, 387 F. 3d 147 (2d Cir. 2004), vacated, 126 S.Ct. 952 (Jan. 18, 2006) (on the ground that the customs agents should not have been permitted to appeal the denial of their dismissal motion). However, Agent Cianci did retain a full copy of the contents; apart from the contents, the Laptop apparently has little value. As to damages against the Government, Intertex cites Mora v. United States, 944 F.2d 156, 159-60 (2d Cir. 1992). However, the Second Circuit disavowed Mora in Adeleke v. United States, 355 F.3d 144, 149-51 (2d Cir. 2004), which says:
. . . [N]either Mora nor its progeny, however, addressed the sovereign immunity implications of such an award against the United States. Accordingly, we are free, and obligated, to do so now. . . .
. . . [W]here the federal government is itself sued, "the available remedies are not those that are `appropriate,' but only those for which sovereign immunity has been expressly waived.". . . This may leave some aggrieved parties without relief, but that is inherent in the doctrine of sovereign immunity.
. . . Rule 41 (g), which simply provides for return of seized property, does not waive the sovereign immunity of the United States with respect to actions for money damages relating to such property.
Accordingly I deny Intertex's request for attorneys' fees.
I direct the Government to provide Intertex, by February 2, 2006, with a copy of all the information that was contained in the Laptop Computer as of the time the Government possessed the Laptop. In all other respects, I deny Intertex's motion.