The recent insider trading prosecution of hedge fund titan Raj Rajaratnam raised many eyebrows in the white collar defense bar for its reliance on wiretap evidence. Though Title III permits the government to seek court authorization to eavesdrop in most white collar investigations, prosecutors have traditionally reserved wiretaps for large conspiracy cases involving drugs, weapons, extortion, and organized crime.
Yet the government’s success in securing a wiretap to investigate insider trading was not the most noteworthy headline to emerge from the Rajaratnam case. Far more consequential was the fate of Rajaratnam’s challenge to the government’s showing of Title III necessity. Like many white collar defendants, Rajaratnam was the subject of a long-running parallel investigation by the Securities and Exchange Commission (SEC) that netted millions of pages of documents and hundreds of hours of witness testimony. Although Title III required the Department of Justice to include in its wiretap application a full and complete statement of the successes of prior investigations, the government disclosed next to nothing about the SEC’s efforts. In a startling pair of opinions, the district court and then the Second Circuit pardoned this unmistakable violation. In so doing, they rewrote decades of wiretap law and effectively neutered the necessity requirement that is the hallmark of Title III.
As such, Rajaratnam is more than just a wakeup call to white collar criminal lawyers. It is a shot across the bow to the defense bar writ large, a harbinger of the day, not so distant, when wiretaps could be as commonplace, and as hard to suppress, as search warrants are today.
I. Title III
A. The History of Title III
The last decade has witnessed steady growth in the number of applications for wiretaps submitted to the courts. In 2012, state and federal courts considered 3,397 wiretap applications, 25 percent more than the year before and nearly twice as many as were presented in 2005.1 Though one might expect a respectable percentage of these applications to be denied, he would be wrong: Of the 3,397 applications submitted to the courts last year, exactly two were denied.2 Of the more than 19,000 wiretap applications submitted from 2005 through 2012, all but six were approved.3
It was not supposed to be this way. When Title III was enacted by Congress as part of the Omnibus Crime Control and Safe Streets Act of 1968, there was broad bipartisan support for toothsome limitations on the state’s ability to eavesdrop. The Supreme Court warned just one year earlier:
Few threats to liberty exist which are greater than that posed by the use of eavesdropping devices. Some may claim that without the use of such devices crime detection in certain areas may suffer some delays since eavesdropping is quicker, easier, and more certain. However, techniques and practices may well be developed that will operate just as speedily and certainly and — what is more important — without attending illegality.4
Consistent with this admonition, Congress passed Title III to accomplish a “dual purpose: (1) protecting the privacy of wire and oral communications, and (2) delineating on a uniform basis the circumstances and conditions under which the interception of wire and oral communications may be authorized.”5 To achieve these purposes, the legislation prohibited electronic surveillance by all but a select group of law enforcement officers, for any purpose other than investigation of “specified types of serious crimes,” and only upon a finding of probable cause.6
Yet the most remarkable aspect of Title III was not the limitations it imposed on the types of crimes for which eavesdropping was authorized, or the list of officials empowered to request a wiretap, or the requirement of probable cause. Rather, what set Title III apart from other constraints on the government’s powers to search and seize was its requirement that a wiretap application establish the wiretap’s necessity as an investigative technique. Specifically, Title III requires that a wiretap application include “a full and complete statement as to whether or not other investigative procedures have been tried and failed or why they appear to be unlikely to succeed if tried or to be too dangerous.”7 Similarly, an order authorizing a wiretap must reflect a court’s determination, “on the basis of the facts submitted by the applicant[,] that … normal investigative procedures have been tried and have failed or reasonably appear to be unlikely to succeed if tried or to be too dangerous.”8
By design, therefore, Title III makes wiretaps a technique of last resort. As discerned by the Supreme Court, Congress’s intent in passing the law was “to make doubly sure that the statutory authority be used with restraint and only where the circumstances warrant the surreptitious interception of wire and oral communications. These procedures were not to be routinely employed as the initial step in criminal investigation.”9
This manifest intent, along with the complexity and expense of a wiretap investigation, has historically constrained the use of wiretaps in run-of-the-mill investigations. At the same time, it has assured defendants of at least one colorable challenge in every wiretap case: a motion to suppress the fruits of the wire because less intrusive techniques would have sufficed to expose the alleged offense.
B. Judicial Roadblocks
Many of Title III’s protections have proven nobler in theory than practice. For example, courts have been generally forgiving of failures to abide by Title III’s express technical requirements. Wiretaps approved on the basis of applications submitted by officials whom the statute does not authorize to submit them10 have often been upheld.11 Similarly, courts have allowed the government to use wiretap evidence to prosecute defendants for crimes that do not appear on the list of offenses for which wiretaps are statutorily authorized — even if what the government is really after is the unenumerated crime.12
Minimization challenges have met a similar fate. Title III requires that wiretaps be monitored in real time to minimize interception of calls that are irrelevant or fall outside the scope of the wiretap authorization.13 But as long as the government has implemented passable training and monitoring procedures, courts will seldom second-guess agents’ judgments that particular calls were relevant and thus properly recorded in full.14 There has also been a failure to follow Title III’s requirement that recordings be sealed “immediately” upon the expiration of the wiretap authorization order,15 which courts have consistently interpreted to justify delays of almost any length.16
Finally, courts have severely diluted the showing the government must make to establish probable cause to believe that “particular communications concerning [an] offense will be obtained through such interception.”17 It turns out not to matter, for example, that the targets of the wiretap are unlikely to discuss their crimes by phone.18 Nor are courts concerned that the government can manipulate the application process by establishing probable cause as to someone other than the real target of the wiretap.19 As long as there is probable cause to believe that someone is using the line in furtherance of criminal acts, wiretap authorization will nearly always be upheld.
C. The Open Road: Necessity
In the face of this steady erosion of so many of Title III’s protections, the necessity requirement has proven remarkably robust.
To establish necessity, “the court must find that alternative methods have been tried or would not have succeeded.”20 When it enacted Title III, Congress contemplated that this finding would be based on an exhaustive inquiry into the sufficiency of, “for example, standard visual or aural surveillance by law enforcement officers, general questioning or interrogation under an immunity grant, use of regular search warrants, and the infiltration of conspiratorial groups by undercover agents or informants.”21 In fact, the list of traditional techniques the government should be required to deploy or explain away is much longer: toll registers, financial investigations, controlled buys, mail and trash covers, trap-and-trace devices, and, where appropriate, newer technologies such as GPS tracking and cell-site data.
The court reviewing an ex parte wiretap application, however, can seldom determine whether an affiant’s description of prior investigative efforts is comprehensive or forthright. As a result, defendants are often able to mount righteous Franks challenges to the necessity showings in the government’s wiretap applications.
To take just one illustrative example, the affiant in United States v. Simpson informed the reviewing court that alleged conspirators “had insulated themselves and their high-echelon accomplices from all but a small circle of associates,” such that “undercover agents, confidential informants, and witnesses could not penetrate the organization to the highest levels because of insulation tactics utilized.”22 However, the affiant did not reveal the extent to which the government had already successfully infiltrated the conspiracy. Upholding the district court’s suppression order, the Ninth Circuit explained that “the specific facts withheld from the issuing judge about this particular investigation reveal that traditional techniques could have led to the infiltration of the entire enterprise.”23
Courts have also been reliable gatekeepers when it comes to detecting and rejecting boilerplate necessity assertions. As a result, the government cannot rely on generalizations about the ways in which criminals operate or the obstacles that law enforcement faces, but rather “must allege specific circumstances that render normal investigative techniques particularly ineffective or the application must be denied.”24
Similarly, courts have consistently required that applications for extensions of previously approved wiretaps — so-called “re-up” applications — make a greater showing of necessity than the wiretap applications that preceded them. This requirement is codified in Title III itself, which demands that re-up affidavits include “a statement setting forth the results thus far obtained from the interception, or a reasonable explanation of the failure to obtain such results.”25 Thus, each re-up application must not only explain why the wiretap application was necessary in the first place, but also why the wiretap has not accomplished its objectives to date.26
Finally, courts have stood vigilant against efforts by law enforcement to import a necessity showing from one wiretap application into another application to tap a different line. Such bootstrapping violates the cardinal rule that the government must establish necessity as to each and every line that it wishes to tap.27
To criminal defense attorneys, these decisions upholding Title III’s necessity requirement have been a bright star in the darkening Title III sky. Not only have they supplied a foundation for viable legal challenges in some very heavy cases, but they have sustained the defense bar’s collective faith that the real-time monitoring of individuals’ spoken words will not be lightly condoned.
II. United States v. Raj Rajaratnam
Considered against this backdrop, the Second Circuit’s decision in United States v. Raj Rajaratnam is a wrenching and foreboding one.
A. Factual History
For years, Raj Rajaratnam was on the short list of the nation’s most successful investors. At its peak, his Galleon Group hedge fund managed more than $7 billion of investors’ money. A native of Sri Lanka who came to the United States to pursue an MBA at the University of Pennsylvania’s Wharton School, Rajaratnam rose quickly through the ranks of a boutique investment bank before starting the hedge fund that he later bought and renamed Galleon. In 2009, Forbes magazine estimated his net worth at $1.8 billion, making him the richest Sri Lankan-born individual in the world.
When federal agents arrested Rajaratnam, U.S. Attorney Preet Bharara heralded the case as the capstone of an assault on insider trading that has resulted in the prosecution of more than 80 individuals. According to the government, Rajaratnam relied on tips from a number of well-placed friends and associates — including former executives, current board members, and directors at blue chip consultancy McKinsey & Company — to amass illegal gains in excess of $70 million.
Before the Galleon investigation, the government had rarely, if ever, deployed wiretaps to investigate insider trading. In March 2008, however, prosecutors sought authorization to tap Rajaratnam’s cellular telephone. The application was based on a 53-page affidavit signed by FBI Special Agent B.J. Kang. U.S. District Judge Gerald Lynch — now of the Second Circuit Court of Appeals — granted the first application for a 30-day wiretap, and the government began intercepting calls on March 10, 2008. Over the ensuing eight months, the government successfully reapplied seven times for a series of 30-day extensions.
Federal agents arrested Rajaratnam in October 2009 and charged him with multiple counts of conspiracy and securities fraud. When his case went to trial 18 months later, prosecutors played more than 40 calls — culled from some 2,400 intercepted by the government — in which Rajaratnam discussed confidential information with corporate insiders. The tapes captured a number of rich exchanges involving Rajaratnam. In one, Rajaratnam told another Galleon employee on the eve of an earnings announcement, “I heard yesterday from somebody who’s on the board of Goldman Sachs that they are going to lose $2 per share.” In another, a tipper told Rajaratnam that two companies had just “shaken hands” on a deal, so Rajaratnam could “now just buy” the companies’ shares. Trading records introduced by the government showed that Galleon made significant trades in the wake of conversations intercepted on the wire.
The jury convicted Rajaratnam on all 14 counts against him. His 11-year sentence is the longest ever imposed in an insider trading case.
B. Necessity in the District Court
Before trial, Rajaratnam moved to suppress the proceeds of the wiretaps on several grounds.28 First, he argued that Title III does not authorize the use of wiretaps to investigate insider trading, as securities fraud is not a crime enumerated in Title III. Second, he argued that the wiretap applications failed to establish probable cause. Third, he argued that the applications failed to show necessity. Fourth, he challenged the sufficiency of the government’s minimization efforts.
The unenumeration and minimization arguments met familiar fates. District Judge Richard Holwell ruled that evidence of the unenumerated crime of securities fraud could be collected incidentally to evidence of the enumerated crime of wire fraud.29 He also found that the relatively small number of nonminimized, nonpertinent calls was insufficient to warrant suppression.30
More interesting were the probable cause and necessity challenges. Rajaratnam argued that the wiretap application failed to show probable cause because it contained false statements and omissions concerning the reliability of cooperating witness Roomy Khan. In particular, the affidavit represented that Khan — who purportedly told agents she exchanged inside information with Rajaratnam for a period of years — had “not yet been charged with any crimes.” In fact she was indicted and convicted of felony wire fraud in 2001. Moreover, at Khan’s sentencing in the 2001 case, the government argued for probation due to Khan’s ongoing cooperation — against Rajaratnam.31
Certain of the re-up affidavits also misrepresented the substance of several of the intercepted calls. Describing one call, for example, the affidavit reported that Rajaratnam said a buy recommendation was based on inside information, when the actual transcript of the call was more ambiguous and included an independent, benign explanation for the recommendation.32
Judge Holwell was plainly bothered by these misrepresentations. In a written order, he chided the government’s attempts to “write these omissions off on the theory that Khan’s criminal record was not important enough to include in the affidavit,”33 and observed that the descriptions of recorded conversations did not “win high marks for candor.”34 Nevertheless, the court found that if the misrepresentations were excised from the affidavits, the remaining content was sufficient to support the reviewing judge’s finding of probable cause. In particular, the court pointed to other recorded statements made by Rajaratnam that independently supplied probable cause to believe that he was engaged in criminal activity.35
This brought the court to necessity. Rajaratnam pointed out that he had been the target of a wide-ranging SEC investigation since September 2006, some 18 months before the first wiretap application was submitted to the district court.36 In the course of that investigation, the SEC had not only subpoenaed documents and analyzed trades, but also interviewed or taken the testimony of numerous Galleon witnesses. Beginning in March 2007 — one full year before the first wiretap affidavit — the U.S. Attorney’s Office and FBI requested access to the SEC’s investigative file and began a series of meetings with the SEC to discuss its investigation. Among other materials, the SEC supplied the criminal authorities with key documents and chronologies of apparent insider trading involving Rajaratnam. The SEC gathered some four million documents from Galleon alone, including several hundred thousand emails. The SEC interviewed 18 Galleon employees and deposed five more. It interviewed Rajaratnam twice and deposed him once; among other topics, he answered questions about insider trading at Galleon, trading in certain technology stocks, instant messages exchanged with Roomy Khan, and his connections to executives at publicly traded companies.37
The wiretap affidavits, however, reported none of this. They said virtually nothing about an SEC investigation at all, let alone the specific techniques deployed or the extraordinary fruits of those efforts. Instead, the affidavit asserted, in exemplary boilerplate, that “alternative investigative techniques have been tried or appear unlikely to succeed if tried.”38
This, too, troubled the court, so much so that it granted Rajaratnam’s request for a Franks hearing. The hearing lasted four days. At its conclusion, Judge Holwell found that the government had made a “glaring omission”:
They failed to disclose to Judge Lynch that the SEC had for several years been conducting an extensive investigation into the very same activity the wiretap was intended to expose using many of the same techniques the affidavit casually affirmed had been or were unlikely to be successful [sic]. A judge hearing an ex parte application relies entirely on the government’s representation that it has disclosed all material facts. But how could Judge Lynch assess whether conventional investigative techniques had failed or were likely to fail without even knowing that they were presently being used in an ongoing SEC investigation upon which the prosecutor and FBI were relying — almost entirely — to construct their own case?39
Of course, there is nothing wrong in their piggybacking the SEC investigation provided they were not improperly directing it. But the court is at a loss to understand how the government could ever have believed that Judge Lynch could determine whether a wiretap was necessary to this investigation without knowing about the most important part of that investigation — the millions of documents, witness interviews, and the actual deposition of Rajaratnam himself, all of which it was receiving on a real-time basis and all of which was being acquired through the use of conventional investigative techniques.40
Indeed, the court went so far as to find that “[t]he USAO and FBI … knew that the SEC investigation was the most important part of their own.”41 Citing testimony of government prosecutors at the Franks hearing, the court pointed out that most of what the criminal authorities did in the course of their “investigation” was review the materials gathered by and received from the SEC.42
Judge Holwell turned to the language of Title III. He recited the law’s requirement that a wiretap application include “a full and complete statement as to whether or not other investigative procedures have been tried and failed or why they reasonably appear to be unlikely to succeed if tried or to be too dangerous.”43 He said:
By failing to disclose the substance and course of the SEC investigation, the government made what was nearly a full and complete omission of what investigative procedures in fact had been tried. That omission deprived Judge Lynch of the opportunity to assess what a conventional investigation of Rajaratnam could achieve by examining what the SEC’s contemporaneous, conventional investigation of the same conduct was, in fact, achieving.44
In addition, the court found a number of subsidiary misstatements that flowed from the overarching failure to acknowledge the SEC investigation. For example, the wiretap affidavit professed that interviewing Rajaratnam and other targets was “too risky” — even though the SEC had in fact interviewed and/or deposed them, and notwithstanding the criminal authorities’ direct involvement in prep sessions preceding those interviews.45 In another misstatement, the affidavit represented that conventional search warrants were “not appropriate” — despite the SEC’s accumulation of millions of documents through routine subpoenas.46 And the affidavit opined that obtaining trading records “would jeopardize the investigation” by alerting traders to the requests — notwithstanding the fact that the SEC had already subpoenaed such records more than 200 times.47
Summarizing his analysis, Judge Holwell acknowledged that he was not “charged with fly-specking the government’s affidavit.”48 But, he continued:
Stepping back to look at the forest, the government in this case did not merely omit some discrete piece of information possibly relevant to a reviewing court’s analysis of necessity; it failed to disclose the heart and soul of its investigation, without which a reasoned evaluation of the necessity of employing wiretaps was impossible.49
At this point in the opinion, the Rajaratnam defense team was likely icing the champagne. Surely the government, having violated Title III’s full-and-complete-statement requirement to the point where a “reasoned evaluation” of necessity was “impossible,” was not entitled to use the proceeds of the wiretap against Rajaratnam at trial. After all, the very purpose of Title III, and of the necessity requirement in particular, is to ensure that the government cannot resort to eavesdropping unless and until a neutral arbiter has determined, on the basis of a complete and candid presentation of the facts, that a wiretap is necessary because traditional techniques will not suffice.
According to Judge Holwell, however, the government’s “glaring” omission was just “the beginning rather than the end of the court’s suppression inquiry.”50 The court thus embarked on an extended analysis of the materiality of the omission to the reviewing court’s necessity determination.
To conduct this analysis, Judge Holwell inserted into the affidavit the content the government omitted. This was no small task. He observed:
[A correct affidavit] would have informed the issuing judge that Rajaratnam had been under investigation for insider trading since 1998 when the U.S. Attorney’s Office in San Francisco began investigating Roomy Khan; that Khan cooperated in the investigation of Rajaratnam as part of a plea agreement; that the SEC began investigating Rajaratnam and Galleon in 2002; that the SEC had interviewed 18 Galleon employees and deposed Rajaratnam and others under oath; that the SEC had issued over 200 subpoenas and obtained millions of pages of documents, including telephone records, trading records, emails, and IMs; that all the evidence was shared with the government through regular meetings during the course of the investigations; and that the evidence thus gathered enabled both the SEC and the government to develop substantial circumstantial evidence of insider trading by Rajaratnam and numerous associates in the securities of several companies. Finally, the evidence gathered led directly to the FBI’s interviews of Roomy Khan during which she “flipped” and provided the government with direct evidence of insider trading by Rajaratnam.51
As the court saw it, the ultimate question was whether the reviewing court, presented with this smorgasbord of information, would still have found the wiretap necessary.
Incredibly, Judge Holwell answered yes. He observed that the evidence collected by the SEC showed a tendency on Rajaratnam’s part to exchange inside information by phone and avoid a paper trail. It followed, said the judge, that even if the reviewing court had known about the massive document haul from the SEC investigation, the court would still have concluded that a wiretap was necessary because reliance on those documents would not have proved the crime.52
Furthermore, the court noted that the many individuals interviewed by the SEC did not admit to insider trading at Galleon. Accordingly, even if the reviewing court had known that 18 Galleon insiders, including Rajaratnam himself, had given substantive interviews on the topics of greatest interest to the government, the court would have found the wiretap necessary because interviews were not sufficient to prove the case. “Where an investigation develops strong circumstantial evidence of wrongdoing but then is confronted by ‘stonewalling’ by witnesses,” wrote the court without citation, “the case for wiretapping is surely strengthened.”53
Finally, Judge Holwell observed that Roomy Khan was uniquely suited to cooperate because she had especially damning evidence against Rajaratnam and had cooperated against him in the past. As such, even if the reviewing court had been aware that the SEC secured Khan’s cooperation against Rajaratnam, and that there were at least a dozen other potential cooperators whom the government could have approached, the court would nonetheless have deemed the wiretap necessary because Khan’s cooperation “[did] not necessarily imply that other targets could also be flipped.”54
Having thus cured the government’s omissions and imagined the ways in which the reviewing court would have analyzed an affidavit it never saw, Judge Holwell concluded that the omissions were immaterial. No matter how fruitful the SEC’s investigation had been, the reviewing court would still have found traditional techniques insufficient to “fully uncover” the particulars of Rajaratnam’s offense.55
Less than four months later, Rajaratnam went to trial; in nine weeks more, he was convicted across the board.
C. Necessity on Appeal
On appeal, Rajaratnam renewed his necessity challenge. Writing for a unanimous Second Circuit panel, Judge Jose Cabranes endorsed the district court’s materiality analysis in full.56 This alone, the court said, was a sufficient basis to affirm.57
Yet the Second Circuit went further. Whereas the district court had no difficulty concluding that the government’s omissions were made with reckless disregard for the truth, the court of appeals went to extraordinary lengths to excuse the government’s misrepresentations.
To do so, the panel scrutinized the transcript of the Franks hearing before the district court. In particular, it pointed to the testimony of the government’s prosecutors and agents that it never “crossed [their] mind[s]” to discuss or describe the SEC investigation in the wiretap application.58 According to the Second Circuit, this collective shrug by the actors directly responsible for the omissions vitiated the district court’s finding that the government acted with reckless disregard for the truth.59 The reasonableness of this conclusion was purportedly bolstered by the fact that the application was reviewed by supervisors at the U.S. Attorney’s Office, none of whom apparently thought to mention the SEC’s investigation either.60
In addition, “[o]n a more fundamental level,” the court of appeals held that a finding of recklessness is unsustainable where inclusion of the omitted information would bolster the necessity showing.61 Here, said the court, the SEC’s inquiry had revealed that Rajaratnam was careful to exchange inside information by phone, and hence that further documentary investigation was unlikely to succeed. Sharing this insight with the reviewing court in the wiretap application “would only have further supported the government’s position” that a wiretap was needed.62 Thus, the government could not have been reckless in failing to share it, as the government would never “intentionally or ‘with reckless disregard’ omit information that would strengthen its ‘probable cause’ or ‘necessity’ showing.”63
In sum, the Second Circuit held that the district court was correct to admit the wiretaps into evidence at Rajaratnam’s trial. But the lower court was wrong to find the government reckless in having failed to advise the reviewing judge of an 18-month-long parallel investigation that netted millions of documents and hundreds of hours of testimony — including the sworn deposition of the target himself.
III. Necessity Requirement Post-Rajaratnam
Here, then, is the state of Title III in the aftermath of Rajaratnam: No matter how extensive or fruitful traditional investigative techniques have been, the government need not disclose them in a wiretap application. For if traditional techniques have failed to secure sufficient evidence to convict the defendant, that shortfall is now the best evidence of the wiretap’s necessity. Precisely because it is the best evidence, the government cannot be reckless in failing to include it, as the government is presumed never to recklessly omit information that is helpful to its cause. Likewise, the omission cannot be material, because inserting the omitted material into the affidavit after the fact will only strengthen the necessity showing.
Thus has the Second Circuit turned Title III upside down. A statute that requires a “full and complete statement” about traditional investigative techniques as a prerequisite to tapping a wire has been interpreted in such a way that the statement is never required at all. Whereas necessity was once about the ability of traditional techniques to “expose” a criminal offense,64 it is now about the ability of such techniques to generate the same kind or quality of evidence a wiretap could yield — an impossible and tautological standard.
It is hard to overstate the significance of this upending. Rajaratnam is widely known as the case that permitted wiretapping in insider trading investigations. But the real injury inflicted by the case goes much deeper. By emasculating the necessity requirement, Rajaratnam strikes at the very heart of Title III.
Worse, there is no practical way to contain the damage. Nothing about the reasoning of the district court or Second Circuit is limited to white collar cases. It is true that white collar defendants are more likely to be targets of parallel investigations by other government agencies. But if the government can freely and fairly neglect to describe search warrants, records requests, interviews, and cooperators in a fraud case because those techniques were less successful than a wiretap would be, so can it leave out the prior efforts of law enforcement in run-of-the-mill drug and gun and racketeering cases. Prosecutors, freed of the burden of canvassing past efforts to infiltrate street gangs and rationalizing disuse of tried-and-true tactics such as visual surveillance and undercover buys, will soon be lining up in courthouses coast-to-coast for wiretap authorizations.
Where does this leave the defendant? Gone, it seems, are the days of challenging wiretaps by listing the investigative techniques that law enforcement could have exploited but did not, and extolling the virtues of techniques already tried. Post-Rajaratnam, the government’s failure to describe prior investigations or account for its decision to forego traditional techniques will nearly always be excusable, either because the government was not reckless or the omission was not material. Cornered, a prosecutor can always argue that a description of prior efforts would only have strengthened the necessity showing — and hence that the omission cannot possibly have been made with reckless disregard for the truth.
In short, Rajaratnam cannot mean what it says, or the necessity requirement of Title III has become a virtual nullity.
Not surprisingly, the chorus of Rajaratnam’s critics is loud and distinguished. A coalition of retired federal judges filed an amicus brief in the Second Circuit before the court issued its opinion.65 According to these amici, the government’s omission of a full and complete statement of prior investigative techniques always requires that the proceeds be suppressed, without regard for the materiality of the omissions. This is so, they say, because judges cannot fulfill the mandate of Title III — to prevent unwarranted intrusions on privacy — unless the government is completely forthright during the wiretap application process.66
More recently, one of Title III’s original draftsmen, Professor Robert Blakey, filed an amicus brief in support of rehearing en banc.67 Like the retired judges before him, Professor Blakey argues that a court cannot, consistent with the text and purpose of Title III, cure the government’s failure to provide a full and complete statement in support of necessity by reading into the application everything the government omitted.68
Rajaratnam’s petition for rehearing en banc has been pending in the Second Circuit since July. Whether or not the court corrects this particular injustice, defense counsel should continue to file necessity challenges in all wiretap cases. In particular, counsel should preserve the argument that the government’s failure to provide a full and complete statement about traditional investigative techniques renders the wiretap invalid per se and requires suppression of its proceeds. Secondarily, counsel should emphasize the successes of prior investigations and preempt any suggestion that the government was entitled to eavesdrop simply because a wiretap was expected to yield better evidence than techniques already tried. In addition, counsel should develop the record on the extent to which prosecutors knew about and took advantage of past investigative efforts, in order to bolster the argument that the failure to disclose those efforts was reckless.
Finally, the defense bar should say a collective prayer — for individuals’ privacy, for judges committed to protecting it, and for the future of Title III.
The defense bar is right to fear that Rajaratnam heralded a new era of eavesdropping in white collar cases. But defense lawyers should also appreciate the broader significance of the case for Title III law as they know it. If the reasoning of Rajaratnam prevails, the necessity requirement will cease to distinguish wiretaps from more customary techniques in law enforcement’s ever-expanding arsenal.
- Administrative Office of the U.S. Courts, Wiretap Report 2012, Table 7.
- Berger v. New York, 388 U.S. 41, 63 (1967).
- S. Rep. No. 1097, reprinted in U.S. Code Cong. & Admin News 1968, 90th Cong. 2d Sess., at 2153.
- 18 U.S.C. § 2518(1)(c).
- 18 U.S.C. § 2518(3)(c)(3).
- United States v. Giordano, 416 U.S. 505, 515 (1974).
- See 18 U.S.C. § 2518(1) (listing approved federal officials); 18 U.S.C. § 2516(1) (listing approved state officials).
- See United States v. Callum, 410 F.3d 571 (9th Cir. 2005) (no suppression where application failed to identify any official who authorized the application); United States v. Citro, 938 F.2d 1431, 1435 (1st Cir. 1991) (permitting attorney general to designate assistant attorneys general by title rather than name); United States v. Traitz, 871 F.2d 368, 379-80 (3d Cir. 1989) (upholding wiretaps where application identified authorizing official by title but not by name); see also United States v. Perez-Valencia, __ F.3d __, 2013 WL 3614524, at *2 (9th Cir. July 16, 2013) (holding that assistant district attorney could apply for wiretap if he was the only person authorized to act as the district attorney for all purposes in the latter’s absence).
- See 18 U.S.C. § 2516 (enumerating offenses that may be investigated via wiretap); See In re Grand Jury Subpoena Served on John Doe, 889 F.2d 384, 388 (2d Cir. 1989) (evidence of federal tax crimes intercepted via wiretap obtained to investigate theft of state taxes); United States v. McKinnon, 721 F.2d 19, 21 (1st Cir. 1983) (evidence of firearms trafficking intercepted via wiretap obtained to investigate drug dealing); United States v. Wager, No. 00-CR-629, 2002 WL 31106351, at *2 (S.D.N.Y. Sept. 20, 2002) (evidence of securities fraud intercepted via wiretap obtained to investigate extortion and racketeering); United States v. Levine, 690 F. Supp. 1165, 1171 (E.D.N.Y. 1988) (evidence of federal tax violations intercepted via wiretap obtained to investigate state grand larceny).
- See 18 U.S.C. § 2518(5) (requiring that wiretaps “be conducted in such a way as to minimize the interception of communications not otherwise subject to interception under this chapter”); United States v. Hoffman, 832 F.2d 1299, 1307 (1st Cir. 1987) (“This minimization requirement spotlights the interest in confining intrusions as narrowly as possible so as not to trench impermissibly upon the personal lives and privacy of wiretap targets and those who, often innocently, come into contact with such suspects.”).
- See United States v. Rivera, 527 F.3d 891, 906 (9th Cir. 2009) (noting that determination whether a call is pertinent “is inevitably a judgment call,” and finding minimization sufficient where just 203 of 4,651 calls were minimized); United States v. Lopez, 300 F.3d 46, 57-58 (1st Cir. 2002) (rejecting minimization attack given small number of nonminimized calls and purported lack of prejudice).
- 18 U.S.C. § 2518(8)(a).
- See United States v. McGuire, 307 F.3d 1192, 1203-04 & n.12 (9th Cir. 2002) (excusing sealing delays as long as 127 days); United States v. Reed, 575 F.3d 900, 914 (9th Cir. 2009) (excusing delay as attributable to court’s busy calendar).
- 18 U.S.C. § 2518(3)(b).
- See United States v. Giacalone, 853 F.2d 470, 480 (6th Cir. 1988) (rejecting extortion defendant’s argument that the government lacked probable cause because agents knew that he extorted his victims face-to-face rather than by phone).
- See United States v. Reed, 575 F.3d 900, 910 (9th Cir. 2009) (holding that agents did not have to discontinue a wiretap upon discovering that the actual user of a tapped line was not the user for whom probable cause was shown in the wiretap application).
- United States v. Ippolito, 774 F.2d 1482, 1485 (9th Cir. 1985).
- S. Rep. 90-1097, 1968 U.S.C.C.A.N. 2112, 2190.
- United States v. Simpson,813 F.2d 1462, 1471 (9th Cir. 1987).
- Id. at 1472-73.
- Ippolito, 774 F.2d at 1486; see also United States v. Rivera, 527 F.3d 891, 899 (9th Cir. 2009) (affiant cannot simply “recite the inherent limitations” of traditional investigative techniques); United States v. Kerrigan, 514 F.2d 35, 38 (9th Cir. 1975) (affiant cannot rely on “mere boilerplate recitations of the difficulties of gathering usable evidence”).
- 18 U.S.C. § 2518(1)(f); see Giordano, 416 U.S. at 530 (“Plainly the function of [this section] is to permit the court realistically to appraise the probability that relevant conversations will be overheard in the future. If during the initial period, no communications of the kind that had been anticipated had been overheard, the Act requires an adequate explanation for the failure before the necessary findings can be made as a predicate to an extension order.”).
- See United States v. Brone, 792 F.2d 1504, 1506 (9th Cir. 1986); United States v. Williams, 737 F.2d 594, 601 (7th Cir. 1984) (“The authorizing judge must be sufficiently informed about the results of the prior interceptions to answer intelligently the question whether probable cause exists to believe relevant conversations will be intercepted in the future.”).
- See United States v. Santora, 600 F.2d 1317, 1321-22 (9th Cir.), as amended, 609 F.2d 433 (9th Cir. 1979) (holding that initial affidavit “was not sufficient to establish that alternative investigative techniques would not succeed with respect to other suspected conspirators whose telephones were later tapped”); United States v. Gonzalez, 412 F.3d 1102, 1115 (9th Cir. 2005) (“[T]he government is not free to transfer a statutory showing of necessity from one application to another — even within the same investigation. This court has held that an issuing judge may not examine various wiretap applications together when deciding whether a new application meets the statutory wiretap requirement. Each wiretap application must separately satisfy the necessity requirement.”).
- 2010 WL 4867402 (S.D.N.Y. Nov. 24, 2010).
- Id. at *3-6.
- Id. at *28.
- Id. at *10.
- Id. at *10-11.
- Id. at *10.
- Id. at *12.
- Id. at *14.
- Id. at *15-16.
- Id. at *17.
- Id. at *15.
- Id. at *17.
- Id. (citing 18 U.S.C. § 2518(1)(c)).
- Id. at *17.
- Id. at *18.
- Id. at *21.
- Id. at *23.
- Id. at *1.
- United States v. Rajaratnam, 719 F.3d 139, 156 (2d Cir. 2013).
- Id. at 155.
- Id. at 156.
- Id. at 155 n.18 (emphasis in original).
- United States v. Kahn, 415 U.S. 143, 153 n.12 (1974).
- Brief of Amici Curiae Retired Federal Judges in Support of Neither Party, United States v. Rajaratnam, 719 F.3d 139 (2d Cir. 2013) (No. 11-4416-cr).
- Id. at 3.
- Brief of Amicus Curiae Professor G. Robert Blakey in Support of Appellant, United States v. Rajaratnam (filed July 31, 2013).
- Id. at 5.