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UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF TEXAS
AUSTIN DIVISION

STEVE JACKSON GAMES
INCORPORATED, et al.,
     Plaintiffs,
v.

UNITED STATES SECRET SERVICE, UNITED STATES OF AMERICA, et al., Defendan

                             _Opinion_


                             I. Facts


The issues remaining at trial in this lawsuit involves the Plaintiffs
Steve Jackson Games, Incorporated, Steve Jackson, Elizabeth McCoy, Walte
Milliken, and Steffan O'Sullivan's causes of action against the United
States Secret Service and the United States of America pursuant to three
statutes, "Private Protection Act", 42 U.S.C. 2000aa _et seq_.; "Wire an
Electronic Communications Interception and Interception of Oral
Communication' Act, 18 U.S.C. 2510, et seq.; and "Stored Wire and
Electronic Communications and Transactional Records Access" Act, 18 U.S.
2701, _et seq_. All other issues and parties have been withdrawn by
agreement of these remaining parties.


The individual party plaintiffs are residents of the states of Texas and
New Hampshire, and the corporate plaintiff is a Texas corporation with i
principal place of business in Austin, Texas.


The Plaintiff Steve Jackson started Steve Jackson Games in 1980 and
subsequently incorporated his business. Steve Jackson Games, Incorporate
publishes books, magazines, box games, and related products F1. More tha
50 percent of the corporation's revenues are derived from its
publications. In addition, Steve Jackson Games, Incorporated, beginning
the mid-1980s and continuing through this litigation, operated from one
its computers an electronic bulletin board system called Illuminati. Thi
bulletin board posts information to the inquiring public about Steve
Jackson Games' products and activities; provides a medium for receiving
and passing on information from the corporation's employees, writers,
customers, and its game enthusiasts; and, finally, affords its users
electronic mail whereby, with the use of selected passwords, its users c
send and receive electronic mail (E-mail) in both public and private
modes. In February of 1990, there were 365 users of the Illuminati
bulletin board.


Steve Jackson was both the owner and employee of Steve Jackson Games,
Incorporated, and authored many of its publications; he used both
Illuminati's public and private programs for electronic mail and his use
ranged from business records of the corporation, contracts with his
writers, communication with his writers regarding articles which were
intended to be published by the corporation, to private communications
with his business associates and friends. Elizabeth McCoy's use of the
Illuminati bulletin board involved her participation as a game player, h
critiques as to the games and publications of the corporation, and her
private communications with associates and friends. William Milliken's u
of the Illuminati bulletin board was apparently limited to private
communicates to associates and friends. Steffan O'Sullivan's use of the
Illuminati bulletin board included writings for publication by Steve
Jackson Games, Inc., his business dealings with the corporation, and
public and private communications with associates and friends.


Importantly, prior to March l, 1990, and at all other times, there has
never been any basis for suspicion that any of the Plaintiffs have engag
in any criminal activity, violated any law, or attempted to communicate,
publish, or store any illegally obtained information or otherwise provid
access to any illegally obtained information or to solicit any informati
which was to be used illegally.


In October of 1988, Henry Kluepfel, Director of Network Security
Technology (an affiliate Bell Company), was advised a sensitive,
proprietary computer document of Bell South relating to Bell's "911
program" had been made available to the public on a computer bulletin
board in Illinois. Kluepfel reported this information to Bell South and
requested instructions, but received no response. In April of 1989,
Kluepfel confirmed the 911 Bell document was available on the Illinois
computer bulletin board and learned the document was additionally
available without any proprietary notice on at least another computer
bulletin board and had been or was being published in a computer bulleti
board newsletter in edited form. In July of 1989, Kluepfel was finally
instructed by Bell South to report the "intrusion of its computer
network to the Secret Service and that the document taken was "sensitive
and "proprietary. Kluepfel had previously worked with the Secret Service
and was known as an expert and reliable informant on computer "hacking."
F2 Thereafter, Kluepfel met Assistant U. S. Attorney William Cook in
Chicago and thereafter communicated with Cook and Secret Service Agent T
Foley. Agent Foley was in charge of this particular investigation.


Around February 6, l990, Kluepfel learned that the 911 document was
available on a computer billboard entitled "Phoenix" which was operated
Loyd Blankenship in Austin, Texas. Kluepfel "downloaded" the document to
put in readable form and then advised these facts to the Secret Service.
Prior to February 26, 1990, Kluepfel learned that Blankenship not only
operated the Phoenix bulletin board, but he was a user of the Illinois
bulletin board wherein the 911 document was first disclosed, was an
employee of Steve Jackson Games, Inc., and a user of the Steve Jackson
Games, Inc.'s bulletin board "Illuminati." Kluepfel's investigation also
determined that Blankenship was a 'co-sysop" of the Illuminati bulletin
board, which means that he had the ability to review anything on the
Illuminati bulletin board and, importantly, maybe able to delete anythin
on the system. Blankenship's bulletin board Phoenix had published "hacke
information and had solicited "hacker" information relating to passwords
ostensibly to be analyzed in some type of decryption scheme. By February
26, 1990, Kluepfel determined that the Phoenix bulletin board was no
longer accessible as he could not "dial" or "log into" it. He reported
this to Agent Foley. While Kluepfel advised Agent Foley that Blankenship
was an employee of Steve Jackson Games, Inc., and was a user and co-syso
of Illuminati, Kluepfel never had any information whereby he was
suspicious of any criminal activity by any of the Plaintiffs in this
cause. Kluepfel was, and is, knowledgeable in the operation of computers
computer bulletin boards, the publishing of materials and document by
computers, the communications through computer bulletin boards (both
public and private communications), and could have "logged" into the
Illuminati bulletin board at any time and reviewed all of the informatio
on the bulletin board except for the private communications referred to
the Plaintiffs as electronic communications or electronic mail, but did
not do so. Kluepfel had legitimate concerns, both about the 911 document
stolen from Bell South and the possibility of a decryption system which
could utilize passwords in rapid fashion and could result in intrusions
computer systems, including those of the Bell System.


In February of 1990, Agent Foley was also knowledgeable about computer
bulletin boards and he too could have "logged" into Illuminati, become a
user and reviewed all public communications on the bulletin board, but d
not do so.


By February 28, 1990, when the search warrant affidavit was executed,
Agent Foley had received information from reliable sources (Kluepfel,
Williams, Spain, Kibbler, Coutorie, and Niedorf, and possibly others F3)
there had been an unlawful intrusion on the Bell South computer program,
the 911 Bell South document was a sensitive and proprietary document, an