Search Warrant (Apartment)

United States District Court
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

APPLICATION AND AFFIDAVIT
FOR SEARCH WARRANT

In the Matter of the Search of the property
located at and in a residential apartment located
at 1200 Western Avenue, Apartment 17E
Seattle, Washington 98101 and in computers
and/other electronic storage devices located therein

I, U.S. FBI Special Agent Kenneth A. Schmutz being duly sworn depose and say:

I am a(n)Special Agent with the Federal Bureau of Investigation (FBI) and have reason to believe that ( ) on the person

of or (XX) on the property known as (name, description and/or location)

1200 Western Avenue, Apartment 17E, Seattle, Washington 98101, and is more fully described in Attachment A, attached hereto and incorporated herein.

in the Western District of Washington, there is now concealed a certain person or property, namely:

(describe the person or property to be seized)

See Attachment B and Affidavit of Special Agent Kenneth A. Schmutz, attached hereto and incorporated herein.

which is (state one or store basis for search and seizure set forth under Rule 41(b) of the Federal Rules of Criminal Procedure)

Evidence, fruits and instrumentalities of criminal activity consisting of aggravated ID theft; fraud in electronic mail; mail fraud; wire fraud; and money laundering.

concerning a violation of Title 18 United States Code, Section(s) 1028(A), 1037 (a)(2) and"a (3), 1341, 1343 and 1956. The facts to support a finding of Probable Cause are as follows:

See Affidavit of Special Agent Kenneth A. Schmutz

Continued on the attached sheet and made a part hereof. ()Yes () No

Signature of Affiant
KENNETH A. SCHMUTZ
Sworn to before me, and subscribed in my presence:
May 23, 2007 at Seattle, Washington
Date City and State

MARY A. THEILER United States Magistrate Judge
Name and Title of Judicial Officer

ATTACHMENT A

The premises to be searched is located at 1200 Western Avenue, #17E, Seattle, Washington, 98101. The premises is an apartment in the southwest building of Harbor Steps Apartments. The apartment is on the seventeenth floor which is the top floor of the building. The front door of the apartment is the first door on the left in the hallway when you exit the elevator. The apartment door faces west towards Puget Sound. The apartment designation "17E" is clearly displayed on the door.

ATTACHMENT B - ITEMS TO BE SEIZED

The items to be seized are the following items that constitute evidence, fruits and/or instrumentalities of criminal activity, consisting of Aggravated Identity Theft, in violation of Title 18, United States Code, Section 1028A, Fraud in Connection with Electronic Mail, in violation of Title 18, United States Code, Sections 1037(a)(2) and (3), and (b)(1)(A), Mail Fraud, in violation of Title 18, United States Code, Section 1341, Wire Fraud, in violation of Title 18, United States Code, Section 1343, and Money Laundering, in violation of Title 18, United States Code, Section 1956 (a)(1), from January 1, 1999, through the present.

The following records, documents, files or materials, in whatever form, including handmade or mechanical form (such as printed, written, handwritten or typed); photocopies or other photographic form; and electrical, electronic and magnetic form (which may be contained in, or present on computers, hard drives, tapes, cassettes, hard disks, floppy disks, diskettes, compact discs, CD-ROMs, DVDs, optical discs, Zip 'cartridges, printer buffers, smart cards, thumb drives, electronic notebooks, cellular telephones, PDAs or any other storage medium):

1. Any and all records pertaining to business, financial, and other transactions conducted by or through Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or by or through any other business entities owned, operated and/or controlled byRobert A. Soloway; financial records to include, but not limited to: financial institution account records including statements, loan files, correspondence, check registers, canceled checks, carbon copies of written checks, check stubs, blank checks, deposit slips, deposit receipts, ATM receipts, retained copies of deposit items, domestic and international wire transfers in and out of the accounts, cashier's checks, money orders, other methods of payment and other financial instruments.

2. Any and all records pertaining to business and financial transactions of Robert A. Soloway, financial records to include, but not limited to: financial institution account records including statements, loan files, correspondence, check registers, canceled checks, carbon copies of written checks, check stubs, blank checks, deposit slips, deposit receipts, ATM receipts, retained copies of deposit items, domestic and international wire transfers in and out of the accounts, cashier's checks, money orders, other methods of payment and other financial instruments.

3. Any and all correspondence referencing, pertaining or relating in any way to Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or to other business entities owned, operated and/or controlled by Robert A. Soloway.

4. Any and all contracts, agreements, invoices, bills, receipts, rental documents, leases, business proposals, correspondence or other evidence reflecting relationships and/or transactions between Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway with any other businesses, vendors, ISPs, server hosting companies, or domain name registrars.

6. Files, documents, messages or records of any kind containing names, telephone numbers, addresses, e-mail names and addresses, contact information and other information pertaining to the identity of, or transactions with, customers of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

7. Appointment books, calendars, and/or work schedules for Newport Internet Marketing Corporation, Newport Corp.,'NW," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

8. Receipt books, ledgers, journals, balance sheets, statements, summaries, schedules and other documentation pertaining to revenue, income and compensation and other financial' consideration or benefit received by or for Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

9. Records relating to, or any correspondence between Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway and any accountants, financial advisors, bookkeepers, or tax return preparers, and any documents relating to the preparation of tax returns, including worksheets or original returns.

10. Records pertaining to assets and liabilities of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

11. Records relating to the expenditure of, or the purchase, sale or transfer of assets, securities, bonds, precious metals or any other investment by or on behalf of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

12. Records relating to credit card purchases and applications for credit, including credit history reports, financial statements, employment history and references by or on behalf of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

13. Records pertaining to the acquisition, investment, equity and disposition of real and personal property and other assets for, or for the benefit of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

14. Records pertaining to shipments, packages and parcels sent and received by and/or from Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

15. Bookkeeping records including trial balances, ledgers, journals, subsidiary ledgers and journals, disbursement records, payroll records, tax data preparation sheets, records, work papers, schedules, statements, forms, summaries, organizers, planners, correspondence, notices and notes for Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

16. Business cards.

17. Telephone records.

18. Records relating to the rental, lease or purchase of storage units, lockers or safe deposit boxes, including contracts, payment receipts, keys, access records and entry access codes.

19. Any computer equipment and storage device capable of being used to commit or further the offenses listed above.

In order to search for data that is capable of being read or interpreted by a computer system and/or their components, law enforcement personnel will need to search and seize the following items:

A. Any computer equipment and storage device capable of being used to commit, further, or store evidence of the offenses listed above;

B. Any computer equipment used to facilitate the transmission, creation, display, encoding or storage of data, including word processing equipment, modems, docking stations, monitors, printers, plotters, encryption devices and optical scanners;

C. Any magnetic, electronic or optical storage device capable of storing data, such as floppy disks, hard disks, tapes, CD-ROMs, CD-R, CD-RWs, DVDs, optical disks, printer or memory buffers, smart cards, PC cards, memory calculators, electronic dialers, electronic notebooks, and personal digital assistants;

D. Any documentation, operating logs and reference manuals regarding the operation of the computer equipment, storage devices or software;

E. Any applications, utility programs, compilers, interpreters, and other software used to facilitate direct or indirect communication with the computer hardware storage devices, or data to be searched;

F. Any physical keys, encryption devices, dongles and similar physical items that are necessary to gain access to the computer equipment, storage devices or data; and

G. Any passwords, password files, test keys, encryption codes or other information necessary to access the computer equipment, storage devices or data.

THE SEIZURE OF COMPUTER SYSTEMS AND/OR THEIR COMPONENTS AS SET FORTH HEREIN IS SPECIFICALLY AUTHORIZED BY THIS SEARCH WARRANT, NOT ONLY TO THE EXTENT THAT SUCH COMPUTER SYSTEMS CONSTITUTE INSTRUMENTALITIES OF THE CRIMINAL ACTIVITY DESCRIBED ABOVE, BUT ALSO FOR THE PURPOSE OF CONDUCTING OFF-SITE EXAMINATIONS OF THEIR CONTENTS FOR EVIDENCE, INSTRUMENTALITIES, OR FRUITS OF THE AFOREMENTIONED CRIMES.

Attachment	Date	Size
SearchWarrant.pdf	06/28/09 1:05 pm	182.36 KB

Search Warrant (Storage)

United States District Court
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

APPLICATION AND AFFIDAVIT
FOR SEARCH WARRANT

In the Matter of the Search of
Storage Unit A145
Public Storage Inc.
12465 Northup Way
Bellevue, WA 98005

I, U.S. FBI Special Agent Kenneth A. Schmutz being duly sworn depose and say:

I am a(n)Special Agent with the Federal Bureau of Investigation (FBI) and have reason to believe that ( ) on the person

of or (XX) on the property known as (name, description and/or location)

Storage Unit A145 at Public Storage Inc., 12465 Northup Way, Bellevue, WA 98005, and is more fully described in Attachment A, attached hereto and incorporated herein.

in the Western District of Washington, there is now concealed a certain person or property, namely:

(describe the person or property to be seized)

See Attachment B and Affidavit of Special Agent Kenneth A. Schmutz, attached hereto and incorporated herein.

which is (state one or store basis for search and seizure set forth under Rule 41(b) of the Federal Rules of Criminal Procedure)

Evidence, fruits and instrumentalities of criminal activity consisting of aggravated ID theft; fraud in electronic mail; mail fraud; wire fraud; and money laundering.

concerning a violation of Title 18 United States Code, Section(s) 1028(A), 1037 (a)(2) and"a (3), 1341, 1343 and 1956. The facts to support a finding of Probable Cause are as follows:

See Affidavit of Special Agent Kenneth A. Schmutz

Continued on the attached sheet and made a part hereof. ()Yes () No

Signature of Affiant
KENNETH A. SCHMUTZ
Sworn to before me, and subscribed in my presence:
May 23, 2007 at Seattle, Washington
Date City and State

MARY A. THEILER United States Magistrate Judge
Name and Title of Judicial Officer

ATTACHMENT A

Robert Soloway's storage unit is to be searched at Public Storage 12465 Northup Way, Bellevue, WA 98005. Unit A145 is located inside Building A. Building A is the first building found upon entering the parking lot. Entering from the door marked 139-159, found on the rear of Building A, black numbers, located on the frame above the vertical rolling door, identify unit 145. A photograph of the storage unit is attached.

[Photo redacted from this text version]

ATTACHMENT B - ITEMS TO BE SEIZED

The items to be seized are the following items that constitute evidence, fruits and/or instrumentalities of criminal activity, consisting of Aggravated Identity Theft, in violation of Title 18, United States Code, Section 1028A, Fraud in Connection with Electronic Mail, in violation of Title 18, United States Code, Sections 1037(a)(2) and (3), and (b)(1)(A), Mail Fraud, in violation of Title 18, United States Code, Section 1341, Wire Fraud, in violation of Title 18, United States Code, Section 1343, and Money Laundering, in violation of Title 18, United States Code, Section 1956 (a)(1), from January 1, 1999, through the present.

The following records, documents, files or materials, in whatever form, including handmade or mechanical form (such as printed, written, handwritten or typed); photocopies or other photographic form; and electrical, electronic and magnetic form (which may be contained in, or present on computers, hard drives, tapes, cassettes, hard disks, floppy disks, diskettes, compact discs, CD-ROMs, DVDs, optical discs, Zip 'cartridges, printer buffers, smart cards, thumb drives, electronic notebooks, cellular telephones, PDAs or any other storage medium):

1. Any and all records pertaining to business, financial, and other transactions conducted by or through Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or by or through any other business entities owned, operated and/or controlled byRobert A. Soloway; financial records to include, but not limited to: financial institution account records including statements, loan files, correspondence, check registers, canceled checks, carbon copies of written checks, check stubs, blank checks, deposit slips, deposit receipts, ATM receipts, retained copies of deposit items, domestic and international wire transfers in and out of the accounts, cashier's checks, money orders, other methods of payment and other financial instruments.

2. Any and all records pertaining to business and financial transactions of Robert A. Soloway, financial records to include, but not limited to: financial institution account records including statements, loan files, correspondence, check registers, canceled checks, carbon copies of written checks, check stubs, blank checks, deposit slips, deposit receipts, ATM receipts, retained copies of deposit items, domestic and international wire transfers in and out of the accounts, cashier's checks, money orders, other methods of payment and other financial instruments.

3. Any and all correspondence referencing, pertaining or relating in any way to Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or to other business entities owned, operated and/or controlled by Robert A. Soloway.

4. Any and all contracts, agreements, invoices, bills, receipts, rental documents, leases, business proposals, correspondence or other evidence reflecting relationships and/or transactions between Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway with any other businesses, vendors, ISPs, server hosting companies, or domain name registrars.

6. Files, documents, messages or records of any kind containing names, telephone numbers, addresses, e-mail names and addresses, contact information and other information pertaining to the identity of, or transactions with, customers of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

7. Appointment books, calendars, and/or work schedules for Newport Internet Marketing Corporation, Newport Corp.,'NW," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

8. Receipt books, ledgers, journals, balance sheets, statements, summaries, schedules and other documentation pertaining to revenue, income and compensation and other financial' consideration or benefit received by or for Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

9. Records relating to, or any correspondence between Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway and any accountants, financial advisors, bookkeepers, or tax return preparers, and any documents relating to the preparation of tax returns, including worksheets or original returns.

10. Records pertaining to assets and liabilities of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

11. Records relating to the expenditure of, or the purchase, sale or transfer of assets, securities, bonds, precious metals or any other investment by or on behalf of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

12. Records relating to credit card purchases and applications for credit, including credit history reports, financial statements, employment history and references by or on behalf of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

13. Records pertaining to the acquisition, investment, equity and disposition of real and personal property and other assets for, or for the benefit of Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

14. Records pertaining to shipments, packages and parcels sent and received by and/or from Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

15. Bookkeeping records including trial balances, ledgers, journals, subsidiary ledgers and journals, disbursement records, payroll records, tax data preparation sheets, records, work papers, schedules, statements, forms, summaries, organizers, planners, correspondence, notices and notes for Newport Internet Marketing Corporation, Newport Corp., "NIM," NPR Corporation, or Broadcast Email Services, and/or Robert Soloway.

16. Business cards.

17. Telephone records.

18. Records relating to the rental, lease or purchase of storage units, lockers or safe deposit boxes, including contracts, payment receipts, keys, access records and entry access codes.

19. Any computer equipment and storage device capable of being used to commit or further the offenses listed above.

In order to search for data that is capable of being read or interpreted by a computer system and/or their components, law enforcement personnel will need to search and seize the following items:

A. Any computer equipment and storage device capable of being used to commit, further, or store evidence of the offenses listed above;

B. Any computer equipment used to facilitate the transmission, creation, display, encoding or storage of data, including word processing equipment, modems, docking stations, monitors, printers, plotters, encryption devices and optical scanners;

C. Any magnetic, electronic or optical storage device capable of storing data, such as floppy disks, hard disks, tapes, CD-ROMs, CD-R, CD-RWs, DVDs, optical disks, printer or memory buffers, smart cards, PC cards, memory calculators, electronic dialers, electronic notebooks, and personal digital assistants;

D. Any documentation, operating logs and reference manuals regarding the operation of the computer equipment, storage devices or software;

E. Any applications, utility programs, compilers, interpreters, and other software used to facilitate direct or indirect communication with the computer hardware storage devices, or data to be searched;

F. Any physical keys, encryption devices, dongles and similar physical items that are necessary to gain access to the computer equipment, storage devices or data; and

G. Any passwords, password files, test keys, encryption codes or other information necessary to access the computer equipment, storage devices or data.

THE SEIZURE OF COMPUTER SYSTEMS AND/OR THEIR COMPONENTS AS SET FORTH HEREIN IS SPECIFICALLY AUTHORIZED BY THIS SEARCH WARRANT, NOT ONLY TO THE EXTENT THAT SUCH COMPUTER SYSTEMS CONSTITUTE INSTRUMENTALITIES OF THE CRIMINAL ACTIVITY DESCRIBED ABOVE, BUT ALSO FOR THE PURPOSE OF CONDUCTING OFF-SITE EXAMINATIONS OF THEIR CONTENTS FOR EVIDENCE, INSTRUMENTALITIES, OR FRUITS OF THE AFOREMENTIONED CRIMES.

Attachment	Date	Size
SearchWarrantStorageApp.pdf	06/28/09 1:05 pm	518.52 KB
SearchWarrantSchmutzAffidavit1.pdf	06/28/09 1:05 pm	648.51 KB
SearchWarrantSchmutzAffidavit2.pdf	06/28/09 1:05 pm	637.8 KB

Search Warrant (Server Drives)

I'm pretty sure that this application for a search warrant and its accompanying affidavit is the one that Soloway's attorneys don't want you to see. Wanting to seal this search warrant certainly makes more sense not letting people know about the seizure of 27 pair of shoes and 24 pair of sunglasses.

==============================
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON

In the Matter of the Search of Six Dedicated Server Hard Drives, Owned by the Internet Hosting Provider Company GoDaddy.com Inc., rented by Robert A. Soloway, on or about March 30, 2007 through May 30, 2007

APPLICATION AND AFFIDAVIT'
FOR SEARCH WARRANT

I, KENNETH A. SCHMUTZ being duly sworn depose and say:

I am Special Agent, Federal Bureau of Investigation and have reason to believe that on the property or premises known as
the Internet Hosting Provider Company GoDaddy.com Inc.
in the Western District of Washington there is now concealed a certain person or property, namely
Six Dedicated Server Hard Drives rented by Robert Al Soloway on or about March 30, 2007 through May 30, 2007
which is
Evidence of Fraud in Electronic Mail, Mail Fraud, Wire Fraud, Aggravated ID Theft, and Money Laundering 1037 (a)(2) and (a)(3); 3341; 1343; concerning a violation of Title 18 United States Code, Sections 1028 (A); 1956(a)(1)

The facts to support a finding of probable cause are as follows:
See attached Affidavit of Special Agent KENNETH A. SCHMUTZ, attached hereto and incorporated herein.
Continued on the attached sheet(s) and made a part hereof:

KENNETH A. SCHMUTZ
Signature of Affiant
Sworn to before me and subscribed in my presence,
June 21, 2007
2: 30 pm at Seattle. Washington

JAMES P. DONOHUE, U.S. Magistrate Judge
Name and Title of Judge

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AFFIDAVIT

STATE OF WASHINGTON
ss
COUNTY OF KING

KENNETH A. SCHMUTZ, being first duly sworn on oath, deposes and says:

1. INTRODUCTION and BACKGROUND

Warrant Requested

1. I make this affidavit in support of an application for a search warrant for six dedicated server hard drives, which are owned by the Internet Hosting Provider company, GoDaddy.corn, Inc. ("GoDaddy,") and which were rented by Robert A. Soloway beginning on or about March 30, 2007, continuing through the date of Soloway's arrest on May 30, 2007.

Agent Background
2. I am a Special Agent of the Federal Bureau of Investigation (FBI), and have been so employed since January 2004. I am currently assigned to the Seattle Office's Cyber Crime Squad, which investigates various computer-related crimes, including computer intrusions and Internet-related frauds.

3. I have both a Bachelors of Science, and a Masters of Science degree in Business Information Systems from Utah State University. Those degree programs involved, among other things, human computer interface, programming in three languages (C + +, COBOL, Pascal), and designing and creating Internet web pages. Prior to my work as a Special Agent, I worked for thirteen years in a variety of capacities in the computer technology field; holding positions, for example, in which I designed, implemented, and supported computer systems for credit unions, performed
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quality assurance testing for a leading network operating system company, and managed a group of software engineers in a high-paced technology company. I have also taught computer classes at the community college level, including courses on Windows NT Server, Networking Essentials, and Introduction to Programming. I recently obtained industry certification in CompTia's Net+ program.

4. As an FBI agent, I have received specialized training, and gained experience in interviewing and interrogation techniques, arrest procedures, search warrant applications, the execution of searches and seizures, federal computer crimes, computer evidence identification, computer evidence seizure and processing, and various other federal criminal laws and procedures. I have investigated dozens of cases involving the use of computers and the Internet to commit federal crimes, and have personally participated in the execution of multiple search warrants involving the search and seizure of computers and related equipment.

Background and Investigation

5. On October 16, 2006, an investigator with the Federal Trade Commission (FTC) contacted the FBI in Seattle regarding a local resident who had been the subject of approximately 100 complaints of spamming, dating back to as early as 1999. I subsequently discussed the complaints with a representative of the FTC, reviewed many of the complaints, and also reviewed some of the summary data that had been gathered by the FTC with regard to the same.

6. The Seattle Office of the FBI consequently opened a criminal investigation of Robert Alan Soloway and his bulk e-mail business, variously known as Newport Internet Marketing, NIM, Newport Corp, NPR, and Broadcast Email Services. The investigation has been open and continuing thereafter.

7. Much of the evidence that was uncovered during the investigation was recounted or summarized in an Affidavit that I swore before Magistrate Judge Mary
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Alice Theiler on May 23, 2007 ("May 23 Affidavit") in support of an Application for Search Warrant to search Soloway's apartment at 1200 Western Ave., in Seattle, Washington. That Affidavit is appended hereto as Attachment A, and incorporated by reference herein.

8. Also on May 23, 2007, the Grand Jury for the Western District of Washington returned an indictment, charging Soloway and his bulk e-mail business with ten counts of Mail Fraud, five counts of Wire Fraud, two counts of Fraud in E-Mail, five counts of Aggravated Identity Theft, and 13 counts of Money Laundering.

9. As explained in both the May 23 Affidavit (at paragraphs 39 - 44), and in the Indictment, (at paragraph 29 of Count 1), Soloway's wire and mail fraud scheme, and his criminal spamming operations have involved the use of a succession of rented servers. More specifically, evidence (including that referenced in paragraphs 39 - 44 of the May 23 Affadivit), obtained during the investigation has shown that Soloway rented groups of servers from various Internet Hosting Providers. He would then install a software program named "Dark Mailer" on the rented servers. The "Dark Mailer" program is recognized within the Internet community as a spamming software program that taps into a network of zombie proxy computers (a "botnet"), and is able to send 50,000 pieces of e-mail per hour. It affords near-total anonymity because of the zombie proxy network feature.

10. During the course of the investigation, I received information that criminal Spam from Soloway was being transmitted from servers that were owned by GoDaddy. Records were obtained from GoDaddy that confirmed that "Robert Solowa", with an address of 1200 Western Avenue, Seattle, WA, had rented servers from GoDaddy beginning on March 30, 2007. The rental was paid with Visa Card No. XXXXXXXXXXXX1217. Other bank records obtained during the investigation show that this Visa Card No. belonged to Robert Soloway.

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11. Robert Soloway was arrested on May 30, 2007, and had his initial appearance in Court on that same date.

12. During the week of June 4, 2007, I spoke by telephone with Ben Butler, Network Abuse Administrator for GoDaddy.com. He advised me that Robert Soloway had rented a total of six dedicated servers from GoDaddy. Mr. Butler indicated that GoDaddy was interested in determining whether the servers that had been rented by Soloway had been used to transmit or distribute spam. Mr. Butler indicated further that if GoDaddy determined that the servers that had been rented by Soloway had been used in spamming activity, GoDaddy would turn those servers over to the FBI.

13. Mr. Butler subsequently telephoned me and advised me that GoDaddy had determined that there was reason to believe that the six dedicated servers that had been rented by Soloway had been used for spamming activity, as indicated by the presence of the Dark Mailer program on them. Mr. Butler further reported that his company, GoDaddy.com, was now requesting that a search warrant be provided to them, and that the company would provide the six servers to the FBI upon receipt of such a warrant.

Conclusion

14. Based on the facts and evidence presented in this affidavit, and in the May 23, 2007 Affidavit incorporated herein, I believe there is probable cause to believe that fruits, instrumentalities and evidence of violations of Title 18 U.S.C. Sections 1037 (a)(2) and(a)(3) (Fraud in Electronic Mail), Title 18 U.S.C. Section 1341 (Mail Fraud), Title 18 U.S.C. Section 1343 (Wire Fraud), Title 18 U.S.C, Section 1028(A) (Aggravated ID Theft), and Title 18 U.S.C. Section 1956(a)(1) (Money Laundering) exist on the six dedicated server hard drives, which are owned by the Internet Hosting Provider company, GoDaddy.com, Inc. ("GoDaddy,") and which were rented by
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Robert A. Soloway beginning on or about March 30, 2007, continuing through the date of Soloway's arrest on May 30, 2007.

KENNETH A SCHMUTZ, Special gent
Federal Bureau of Investigation

Subscribed to and Sworn to before me this 21st day of June, 2007.

JAMES P. DONOHUE
United States Magistrate Judge

Attachment	Date	Size
GoDaddySearchWarrant.pdf	06/28/09 1:05 pm	180.63 KB
SearchWarrantSchmutzAffidavit1.pdf	06/28/09 1:05 pm	648.51 KB
SearchWarrantSchmutzAffidavit2.pdf	06/28/09 1:05 pm	637.8 KB

Defendant's Response to Motion for Detention

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,

Plaintiff,

v.

ROBERT ALLEN SOLOWAY,

Defendant.

DEFENDANT'S RESPONSE TO GOVERNMENT'S MOTION FOR DETENTION

I. INTRODUCTION.
Robert Allen Soloway ("Robert" herein), was arrested on May 30, 2007. He is charged in a multiple count indictment, alleging violations of 18 U.S.C. §§1341, 1343, 1037(a)(2), 1028A, and 1956. None of the offenses alleged in the indictment raises a rebuttable presumption that Soloway, who has no prior criminal history, is a risk of flight or a danger to the community. See 18 U.S.C. §§3142(e) and 3142(f)(1).

II. ARGUMENT.

A. ROBERT SHOULD BE RELEASED ON HIS PERSONAL RECOGNIZANCE, SUBJECT TO REASONABLE CONDITIONS.

18 U.S.C. §3142(b) provides, in relevant part, as follows:
The judicial officer shall order the release of the person on personal recognizance, or upon an unsecured property appearance bond in an amount specified by the Court . . . unless the judicial officer determines that such release will not reasonably assure the appearance of the person as required or will endanger the safety of any other person or the community. (emphasis supplied)

Pursuant to 18 U.S.C. §3142(c), if the Court determines that the release described in §3142(b) will not reasonably assure the appearance of the person as required or will endanger the safety of any person or the community, the Court shall order the release of the individual subject to the least restrictive further condition or combination of conditions that will reasonably assure the appearance of the person and the safety of the community.

The Ninth Circuit holds that in evaluating the government's motion for detention
. . . we bear in mind that federal law has traditionally provided that a person arrested for a non-capital offense shall be admitted to bail [citations omitted]. Only in rare circumstances should release be denied. [Citations omitted.] Doubts regarding the propriety of release should be resolved in favor of the defendant. [Citations omitted.]

Release pending trial is governed by the Bail Reform Act of 1984 which, like its predecessor, the Bail Reform Act of 1966 [citation omitted], mandates release of a person facing trial under the least restrictive condition or combination of conditions that will reasonably assure the appearance of the person as required. [Citations omitted.] The Fifth and Eighth Amendments' prohibitions of deprivation of liberty without due process and of excessive bail require careful review of pretrial detention orders to ensure that the statutory mandate has been respected.
United States v. Motamedi, 767 F.2d 1403, 1405 (9th Cir. 1985).

In determining whether there are conditions of release that will reasonably assure the appearance of the person as required, the court is directed by the statute to take into account the available information concerning the factors set forth in 18 U.S.C. § 3142(g). These factors are discussed below. Factual representations are made by proffer, pursuant to 18 U.S.C. § 3142(f).

1. NATURE OF THE OFFENSE CHARGED, 18 U.S.C. 3142 (g)(1).

The court is directed to take into account the nature and circumstances of the offense charged, including whether the offense is a crime of violence, a Federal crime of terrorism, or involves a minor victim or a controlled substance, firearm, explosive, or destructive device. The offenses charged in the indictment do not include any of the factors enumerated in 18 U.S.C. §3142((g)(1).

The legislative history clearly establishes that the drastic remedy of detention is to be reserved to extreme cases.
There is a small but identifiable group of particularly dangerous defendants as to whom neither the imposition of stringent release conditions or the prospect of release can reasonably assure the safety of the community or other persons. It is with respect to this limited group of offenders that the courts must be given the power to detain release pending trial.
Senate Report No. 225, 98th Cong., 1st Sess. 6-7 (1983) printed in 1984 U.S. Code Cong. and Ad. News 3182, 3189 (emphasis supplied). "The wide range of release conditions available ensures, as Congress intended, that very few defendants will be subject to pretrial detention." United States v. Orta, 760 F. 2d 887 (8th Cir. 1985) (emphasis supplied).

2. WEIGHT OF THE EVIDENCE AGAINST THE DEFENDANT, 18 U.S.C. 3142 (g)(2).

"The weight of the evidence is the least important of the various factors." United States v. Motamedi,767 F.2d at 408. Even if the evidence is "strong," that is not sufficient to sustain a detention order.

Evidence that defendant committed the narcotics offense with which he is charged, even if very compelling, cannot by itself satisfy the requirement of §3142(f) that a determination "that no condition or combination of conditions will reasonably assure the safety of any other person in the community" be supported by clear and convincing evidence. Indeed, to find otherwise would also violate the specific directive of §3142(g), which provides that certain factors -- including the history and characteristics of the defendant -- be considered by the court in determining whether a particular defendant be detained.
United States v. Moore, 607 F.Supp. 489, 498 (N.D.Cal. 1985) (emphasis supplied).

3. HISTORY AND CHARACTERISTICS OF THE PERSON, 18 U.S.C. § 3142(g)(3).

Robert has resided in Seattle since January, 2004. The rent on his apartment is paid up for the next six months, and that would be his primary residence should the Court order his release. However, should it become necessary, his parents have informed Pretrial Services that Robert is welcome to reside with them in Palm Desert, California.

Although Robert suffers from Tourette disorder, anxiety, and depression, these physical and mental conditions will not interfere with his ability to appear for future court appearances. Indeed, given the difficulty in obtaining proper medical care and medication at the Federal Detention Center, Robert will be in much better physical and mental health if he is released. He has no history of drug or alcohol abuse, nor does he have any criminal history.

B. THE GOVERNMENT'S EVIDENCE DOES NOT ESTABLISH THAT ROBERT IS A FLIGHT RISK.

The government's detention motion alleges that there is a "serious risk" that Robert will flee if released. The government's motion is long on unsupported conjecture, and woefully short on facts that would support this unfounded allegation. The government must prove that a defendant would flee "by a clear preponderance of the evidence." United States v. Motamedi, 767 F.2d 1403, 1406 (9th Cir. 1985).

C. THE GOVERNMENT MUST PROVE THAT ROBERT IS A DANGER TO THE COMMUNITY BY CLEAR AND CONVINCING EVIDENCE.

The government's detention motion also alleges that there are no conditions of release for Robert that will reasonably assure the safety of any other person in the community. Congress noted in the passing of the Bill Reform Act that pretrial detention should be reserved for that "small but identifiable group of particularly dangerous defendants as to whom neither the imposition of stringent release conditions nor the prospect of revocation of release can reasonably assure the safety of the community or other persons." 1984 Code Cong. and Ad. News at 3182, 3189.

Where the government requests that an individual is to be held without bail due to that person's dangerousness to the community, the government must prove by clear and convincing evidence that the defendant is one of those rare individuals who pose such a danger to the community that they must be detained. See, United States v. Motamedi, supra; United States v. Walker, 808 F.2d 1309, 1310 (9th Cir. 1986). In fashioning conditions to assure the safety of the community, the courts are not to attempt to guarantee the safety of others in the community. United States v. Orta, 760 F.2d 887, 891 (8th Cir. 1985). Rather the courts are to consider what will reasonably assure such safety. The circumstances of the present case do not provide clear and convincing evidence of dangerousness.

III. CONCLUSION.

For all of the reasons hereinabove set forth, there are conditions that will reasonably assure Mr. Soloway's appearance at all future hearings in this case, and that will also assure the safety of the community. Accordingly, we concur with Pretrial Services' recommendation for release, and further concur with the conditions they have recommended.

DATED this 12th day of June, 2007.

Attachment	Date	Size
DetentionMotionResp.pdf	06/28/09 1:05 pm	259.95 KB

ORDER on MOTION for Pre-Trial Detention

Minute Entry for proceedings held before Judge James P. Donohue - CRD: Agalelei Elkington; AUSA: Kathryn Warma; Def Cnsl: Richard Troberman; PTS: Courtney Knudsen; Court Reporter: Digital Recording; Time of Hearing: 9:00am; Courtroom: 12A; DETENTION HEARING as to Robert Alan Soloway held on 6/13/2007.

Defendant present in custody. Pretrial Services report reviewed, recommends release with conditions. Government argues for detention. Gov. exh. 5,6,1.1,1-10,10-2,1-17,1-17-2,1-19,1-21-2,1-25-2,1-26,2,3,4,8,10,11,12 Marked and admitted. Defense Counsel argues for release. victim: W. McCloud, Sworn & Testifies. Defendant ORDERED detained. Defendant remanded to custody. (AE, )

=====================================

UNITED STATES DISTRICT COURT
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT SOLOWAY,
Defendant.

DETENTION ORDER

Offenses charged:
Counts 1 - 10: Mail Fraud in violation of 18 U.S.C. § 1341.

Counts 11 - 15: Wire Fraud in violation of 18 U.S.C. § 1343.

Counts 16 - 17: Fraud in Connection with Electronic Mail in violation of 18 U.S.C. §§ 1037(a)(2) and (b)(1)(A).
Counts 18 - 22: Aggravated Identity Theft in violation of 18 U.S.C. § 1028A(a)(1).

Counts 23 - 25: Money Laundering in violation of 18 U.S.C. § 1956(a)(1)(A)(i).

Date of Detention Hearing: June 13, 2007.
The Court, having conducted a detention hearing pursuant to 18 U.S.C. § 3142(f), and based upon the factual findings and statement of reasons for detention hereafter set forth, finds the following:

FINDINGS OF FACT AND STATEMENT OF REASONS FOR DETENTION

(1) Defendant has dual United States-Sweden citizenship. In the past, the defendant has boasted that the legal process will not affect him, stating that “I’m a Non-US citizen.”

(2) Defendant has family in Sweden.

(3) Although Defendant has lived in the Seattle area for approximately three years, he has no real or determinable ties to the Western District of Washington. He has no employment other than his personally-owned internet company, and it appears that he can operate that business in any geographic area.

(4) The grand jury has found that there is a probable cause to believe that the defendant has engaged in aggravated identify theft and sophisticated crimes involving use of a computer and electronic mail. It is apparent that defendant is quite experienced and adept in the use of computers. The creation of new identities and travel documents would be relatively simple task for the defendant.

(5) The defendant has demonstrated an unwillingness or inability to comply with Court orders. In Braver v. Newport Internet Marketing Corp., et al, CV 5:05-210T (W.D. Okla. 2005), a permanent injunction was entered against the defendant enjoining him from: (1) initiating the transmission of a commercial electronic mail message, to any computer involved in interstate commerce or communication, or a transactional or relationship message, that contains, or is accompanied by, header information that is materially false or misleading; and (2) relaying or retransmitting a commercial electronic mail message that is unlawful under 15 U.S.C. §7704(a) from a protected computer or network accessed without authorization. Defendant was fully aware of the ordered injunction, yet engaged in the activities that are the subject of the pending criminal indictment. This is significant evidence demonstrating that he is unlikely to comply with conditions of pretrial supervision.

(6) The process server in the Braver litigation attempted to obtain service not less than 15 times. The court ultimately allowed process by mail. The defendant subsequently appeared in the litigation. However, even with knowledge of the injunction, he continued the activities that are the subject of the pending indictment.

(7) Defendant has not been candid about his financial assets. It appears that he has been involved in establishing off-shore accounts, placing funds in others names, and in setting up electronic accounts for later access.

(8) Evidence has been proffered that defendant has attempted to threaten those who have filed complaints against him. Because a party to a lawsuit is able to aggressively defend himself, the Court makes no specific findings regarding witness intimidation. Nevertheless, the crimes for which defendant has been indicted can easily be repeated from abroad, and these crimes have no geographical boundaries. Retribution that the defendant has previously shown against those who have complained can just as easily be handled through the internet from abroad.

(9) There appear to be no conditions or combination of conditions other than detention that will reasonably address the risk of flight and danger to other persons or to this community.

IT IS THEREFORE ORDERED:
(1) Defendant shall be detained pending trial and committed to the custody of the Attorney General for confinement in a correction facility separate, to the extent practicable, from persons awaiting or serving sentences or being held in custody pending appeal;

(2) Defendant shall be afforded reasonable opportunity for private consultation with counsel;

(3) On order of a court of the United States or on request of an attorney for the government, the person in charge of the corrections facility in which
defendant is confined shall deliver the defendant to a United States Marshal for the purpose of an appearance in connection with a court proceeding; and

(4) The Clerk shall direct copies of this Order to counsel for the United States, to counsel for the defendant, to the United States Marshal, and to the United States Pretrial Services Officer.

DATED this 13th day of June, 2007.

JAMES P. DONOHUE
United States Magistrate Judge

Attachment	Date	Size
DetentionOrder.pdf	06/28/09 1:05 pm	20.53 KB

Transcript of Detention Hearing

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON

THE UNITED STATES OF AMERICA,
Plaintiff,

vs.

ROBERT ALAN SOLOWAY,

Defendant.
______________________________

VERBATIM TRANSCRIPT OF PROCEEDINGS OF A DETENTION HEARING BEFORE THE HONORABLE JAMES P. DONOHUE

June 13, 2006

APPEARANCES

For Plaintiff United States: Kathryn Warma
For Defendant Soloway: Richard Troberman
Also Present: Courtney Knudsen, USPTS

Transcribed from CD recording using word processing equipment
Transcribed by Brian Killgore

(Proceedings of 6/13/2007)
THE CLERK: All rise. The United States District Court for the Western District of Washington is now in session the Honorable James P. Donohue presiding.
THE COURT: Good morning. Please be seated.
THE CLERK: Your Honor, the matter before you is scheduled for a detention hearing in Cause Number CR 07-187, assigned to Judge Pechman, United States v. Robert Soloway.

Will counsel please make appearances?

MS. WARMA: Good morning, your Honor, Kathryn Warma on behalf of the United States.

THE COURT: Good morning, Ms. Warma.

MR. TROBERMAN: Good morning, your Honor, Richard Troberman on behalf of the defendant Robert Soloway who is present this morning for the detention hearing.

THE COURT: Good morning, Mr. Troberman. Good morning, Mr. Soloway.

We are here on the government's motion to detain Mr. Soloway pending trial in this matter.

In anticipation of the motion, I have re-reviewed the indictment in this case. I also reviewed Pretrial Services' report dated May 30, 2007, and June 5, 2007.

I reviewed the government's exhibits for detention hearing bearing a date of May 30, 2007.

I see on my desk there appears -- I assume that that has been replaced by the exhibit hearing notebook that I have dated June 12, 2007?

MS. WARMA: That's correct, your Honor.

THE COURT: I have also reviewed the memorandum filed on behalf of Mr. Soloway dated June 12, 2007.

At this point I will hear, Ms. Warma, from the government.

MS. WARMA: Thank you, your Honor.

As you are aware, there are two principal factors that the Court is asked to consider in terms of detention, and those are serious risk a person will flee, and serious risk that the person will obstruct or attempt to obstruct justice.

We believe, your Honor, that we have clear and convincing evidence that both of those conditions exist in this case.

The factors that the Court is to consider in making that assessment are set out at 3142G, and what I would propose to do, your Honor, is to move through a number of exhibits for your consideration and then address those factors, tie the exhibits back to those factors. What I would like to do, preliminarily, is review the scheme itself and the components of the scheme. I understand your Honor has read the indictment and certainly that gives part of it, but the scheme was this: Beginning no later than November of 2003 -- is the date we have charged, because that was the time that Mr. Soloway moved to Washington -- he began a scheme of mail fraud and wire fraud that surrounded a company that he has variously called Newport Internet Marketing and other things. Through that company Mr. Soloway sold two things: He sold what he characterized as broadcast e-mail services and what he characterized as a broadcast e-mail product – that he would sell to people so that they could do their own, what he called, "broadcast e-mail." Those products and services were sold through a website, a series of websites that Mr. Soloway has published on a series of different domains, and he has advertised the website and his services also through spammed messages. On the website that he has published, he has made fraudulent representations with respect to the services and the product that he has sold; he has made fraudulent
representations with respect to the technical service he will provide in support of those products; and he has provided fraudulent representations with respect to guarantees and money back. The spammed messages that Mr. Soloway has sent out to advertise his product and his website are criminal spam as of January 1, 2004 -- in part because they contain, routinely, false and forged header information -- that is he makes it appear as though other people are responsible for the spam, and they are sent using a network of proxy computers. That is done to hide the originating IP address of the spam messages. Many of the forged headers that are used actually contain the domain names or the e-mail addresses of real people. As a result of that, these other real people or real businesses have been blamed for criminal spam that has been sent by Mr. Soloway. Many times their businesses have suffered severe financial effects as a result of that, and those have included their e-mail traffic being blacklisted because it has been identified with spam.

Now as I proceed through these exhibits, I would like to first take you to an example of Mr. Soloway's website, and part of the reason for that is to again underscore the categories of victims that he has impacted with his conduct. And then I would like to demonstrate to the Court, through exhibits, how he has dealt with the victims of his conduct, which goes to the risk that he will obstruct justice if released. And then I would like to go through some of the financial information that is available in this case, which we believe supports a risk of flight.

So if your Honor would turn to what has been marked Exhibit 5, and these exhibits will -- we will display electronically.

THE COURT: Exhibit 5 bearing Bates 71?

MS. WARMA: Right, and I am actually taking your Honor to the second page of that exhibit, which is Bates stamp 72.

The material in Exhibit 5 consists of what is called "screen captures" of one of the iterations of Mr. Soloway's website. The website has been published, as I indicated, using a variety of -- based from a variety of different domains, and also employing various names for the company. If your Honor will notice in this particular example -- maybe this will work -- he has used the company name NPR Corp., so that if someone would Google NPR, it would actually give them information with respect to this website that actually belongs to Mr. Soloway.

One of the things that I would like to emphasize on this website, and I believe this was the homepage -- the very first representation made: With our assistance, you can reach 100,000 to 25 million potential new customers a day with your ad for as low as this cost -- per 500,000 opt in permission-based broadcast e-mail advertisement sent. This is an important representation or misrepresentation, false representation, which is made consistently throughout Mr. Soloway's websites, his representations to potential customers. This is significant because whether or not addresses are opt in has to do with whether they might be considered spam, and if people have signaled their willingness to accept such e-mail messages, of course they won't be offended by them.

If we look down further on this homepage, we can see as well a representation also typical of Mr. Soloway with respect to he is the number one broadcast e-mailer in the world. He has much experience in this type of activity.

Then if we look at the next page of the exhibit -- this, your Honor, if you had gone up to the top of the homepage, you would have seen what you also see here -- that is various tabs. Click to home, charity info, e-mail software, and e-mail services. This is what you would see if you clicked on e-mail software. This is his advertisement: Send your own e-mail ads -- his advertisement for selling this product to people, which he says will allow them to do the broadcast e-mail.

And turning to the next page, this is what you would see if you clicked on the e-mail services tab. It would take you to this page and some pages that follow it that advertise more specifically he will send e-mail ads on behalf of you and again many representations about the business results, the financial results that people will see if they buy his product or his service.

Turning to the next page of the exhibit, what you will see here is the guarantee that was routinely offered to individuals, to potential customers who were interested in the broadcast e-mail package. If you do not receive at least a 400% increase in sales after using our broadcast e-mail package for 90 days, simply return it to us for a full 100% refund, no questions asked.

And turning to the next page, again, another ironclad guarantee, and this is with respect to the service. He is representing the results that people will see if they buy his service.

And finally I wanted to show this page to the Court. This is another page, typical page from one iteration of his website in which he is talking about the round-the-clock technical support he is going to provide to customers, and two other things I wanted to bring the Court's attention to.

On the left-hand side: We offer 24/7 easy hassle free e-mail removal from all of our e-mail mailing lists. So this is representing that people who get e-mail for which he is responsible can enter in your e-mail address on this website and they will be removed from his e-mail list. On the right-hand side there is a corporate address provided for, in this case, NPR Corporation, and that is a fraudulent address.

Finally I have one more page in this exhibit, 78, and again representations with respect to his -- how he operates and the facts -- in particular, again, if you can see the cursor, permission -- they are using -- he is offering people permission-based opt in e-mail records, and that's what will be used in his business.

And with that, your Honor, I would like to offer Exhibit 5.

THE COURT: Any objection?

MR. TROBERMAN: No, your Honor.

THE COURT: Exhibit 5 will be received.

MS. WARMA: So I would like to move now to Exhibit 6. Exhibit 6, your Honor, consists of two pages, and these are representative spammed e-mail messages that Mr. Soloway would send out to advertise his website or his business.

A person who receives this e-mail could click on the link he has provided in the e-mail, and that would take the person to the website further advertising the product. Two things to notice about this e-mail message: Of course the e-mail advertised like this to 8 million people for free, that was -- the numbers might change in the spammed e-mail message, but basically that message was always the same. Click on this link and I will show you how you can do this. Also the from and to addresses in this spammed e-mail are characteristic of Mr. Soloway's conduct in forging headers.

As you note, the to address and the from address are exactly the same, and we will talk a little bit more about that. The message that is contained in the bottom of the email refers to -- this is only for -- this is only a noncommercial offer. That content shows up in a number of Mr. Soloway's spammed messages. I believe it is an attempt to circumvent the elements of the crime, the federal crime of spamming, because it applies to commercial e-mail messages, so he has placed this in his spammed message. In fact, of course, all he does is sell spam and sell spam products.

The following page of that exhibit again is another characteristic spammed e-mail message from Mr. Soloway. It was turned in to law enforcement by victim who received -- has received many of these things who was -- who is Mr. Major, and again, if you look at the header information --

THE COURT: I'm sorry, can you identify the specific -- the one showing up on the screen doesn't have the --

MS. WARMA: Bates stamp number?

THE COURT: Yes.

MS. WARMA: Yes, I will, your Honor. This is 80, Bates stamp 80.

THE COURT: I'm sorry?

MS. WARMA: 80.

THE COURT: Thank you.

MS. WARMA: So it is the second page of Exhibit 5 -- Exhibit 6, excuse me.

So then again, this is another example, if you look at the from, it says it is from sales at Dale Major.com. Dale Major is a real person who owns a business; his business is selling steel tubing in the airline manufacturing area, and Mr. Major is very concerned that spam e-mail messages that are really sent by Mr. Soloway have been identified as coming from his company. That has impacted his ability to do business. The "to" address is the same.

So one of the points I wanted to make with these exhibits, your Honor, and I would offer Exhibit 6 --

THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: No, your Honor.

THE COURT: Exhibit 6 will be received.

MS. WARMA: There are three categories of victims that have been impacted by Mr. Soloway's criminal conduct, and those are people who have been impacted by his spamming activities, largely because he has fraudulently stolen other people's online identities and placed them into forged headers; people who are the victims of his fraudulent sales of product and services; and also very specifically victims of identity theft who have been damaged irrevocably and significantly by his activities.

I would like to speak now to how it is that Mr. Soloway has dealt in the past with victims of his criminal conduct, which is quite relevant in this particular hearing, and in that regard, I would like to ask the Court to look to Exhibit 1, and this has a number of subsections to this particular exhibit.

Exhibit 1 consists of material from a civil lawsuit that was filed by a man named Robert Braver. Mr. Braver lives in Oklahoma. He runs a small company, a small ISP. He does such things as sets out electronic e-mail systems for little companies or for law firms, for example. Mr. Braver in his business began receiving spam from Mr. Soloway, over and over and over again. He would set up new e-mail systems for clients only to have those clients begin receiving huge quantities of spam, which made them very dissatisfied customers, which affected his ability to run his business.

Mr. Braver tried to get Mr. Soloway to stop spamming him and his clients. He had no success in doing that so he felt his only option ultimately was to file a lawsuit, which he did in Oklahoma, alleging violations of the Oklahoma anti-spamming statute, and also the federal canned spam act, the federal criminal spam statute, and the documents we are going to go through now are documents from that case.

Beginning with what is Bates stamped as 1, and that is just advising with respect to the identity of the case.

This was a case that ended up in federal court in Oklahoma. It was actually originally filed in state court, but Mr. Soloway had it removed to federal court, and you can see the plaintiff is Braver, and the defendant Newport Internet Marketing, one of the monikers for Mr. Soloway's businesses. Then if we go to page 2, what we are starting to see here is the docket sheet, and I just want to walk the Court through this docket sheet because there is much in this case that is very, very relevant to the issues we are to address today.

THE COURT: If you do so quickly. I actually reviewed -- the docket sheet was part of the materials submitted to me before, and I have reviewed that.

MS. WARMA: Okay, I will do that, your Honor. I will highlight just a few things, the first thing being the notice of removal; again, it was Mr. Soloway who sought removal to federal court, and at that point entered an appearance through an attorney.

In February -- February 23, there was an unopposed motion for extension of time to file an answer, so he has no [sic] come into this federal case. The plaintiff says, Okay, yes, you can have additional time to answer, and the answer due, and this is in Docket number six, there was an order granting an extension of time. An answer was due on March 22. That deadline, however, came and went. There was an amended complaint filed, and by agreement of the parties, a new deadline was agreed to, to answer, and that was to be May 18, which isn't really reflected on this, but what the Court can see is on May 20 what was filed, not an answer -- two days after the deadline to answer -- but a motion to withdraw from the attorney of record for Mr. Soloway, as well as a request for additional time to answer. And if we go now to the next page, the plaintiff answered in response to that motion for an extension of time, and we will look more carefully at that specific pleading. Then a few things I wanted to point out were the answer was never filed. There was a motion for default judgment filed by the plaintiff in June -- on June 13, and that is docket number 13. The clerk entered an entry of default on September 13. The Court then ordered -- said, Wait, there has got to be a hearing on that motion, so on 9/14 -- this is docket entry 16 -- the Court ordered -- deferred ruling and scheduled a hearing, which was on September -- to be on September 22. On 9/21 there was notice by the former attorneys of the defendant with respect to all of the notices having been sent to Mr. Soloway about that hearing because the Court ordered those attorneys to still notify him.

On 9/22 is the minute entry for the actual hearing at which the defendant failed to appear. Again on 9/22 docket entry 19, an order granting the motion for default judgment and a permanent injunction.

Then -- and now we are looking at page 4 -- then Mr. Soloway hires another attorney after the entry of default judgment, and asks that the default judgment be set aside.

He makes a motion for that. Mr. Soloway files an affidavit with respect to that. That motion is declined by the Court and at docket entry number 26 the Court issues that order denying the motion. And now I would like to look at a few of the individual pleadings in that case.

Those begin at 1-10, and the second number, your Honor, signifies the docket entry number on the Court's docket. That is plaintiff's objection to that first motion for additional extension of time after the attorney had withdrawn, and it recounts in some detail the shenanigans of Mr. Soloway in the misconduct that went on in the context of this lawsuit, and I think it bears making more mention of it, and that includes that the plaintiffs had originally filed in state court, and that they had attempted through a process server to make service on Mr. Soloway, and we will see an affidavit from the processor who swore that on 15 different occasions they attempted to make service.

On the next page, finally, they were given permission to serve by mail, and we are looking at paragraph 4 now, and these are -- this is some of the information with respect to the defense notifying the plaintiff's counsel that they would asked to be removed, the extension of time, the agreement with respect to an amended complaint, the due date for the amended complaint, and then the action on the part of the defense down in paragraphs 6 and 7 that the attorney instead withdrew and no answer was filed on the agreed date. On the next page -- and here I would like to take your Honor down to paragraph 10 and focus on that for a moment. This is beginning to recount the conduct of Mr. Soloway in the context of this lawsuit while it was going on -- that he began on March 25 anonymously broadcasting a message clearly designed to threaten, harass, intimidate, and cast aspersions on the plaintiff.

The gist of the message was he was soliciting other people around the country or the world to join in various lawsuits against Mr. Braver who had brought this action against him. It was sent to various public online forums and indicating that he would cover the costs of any of these lawsuits.

Then in paragraph 11 -- meantime Microsoft had also filed a spamming lawsuit against Mr. Soloway in Superior Court in Washington, and Mr. Soloway was defaulting in that case, as well. He was not cooperating. So this is a reference to that and the fact that the Court had entered an order against him in that case, and ultimately entered judgment against him for $7.85 million for his spamming conduct in Washington in a case in which he failed to cooperate with the Court -- follow the Court's instructions, and he defaulted.

The next page again recounting more of Mr. Soloway's conduct in how he's dealing with people who are trying to address his criminal spamming.

Paragraph 12. More information with respect to Mr. Soloway's posting messages on forums, talking about the lawsuits and how they can't touch him -- basically. He will never pay a penny. Nobody can get to him.

In paragraph 13 reference to the fact that Mr. Soloway's attorney contacted the plaintiff's attorney, threatened to file a defamation lawsuit against him in California in an attempt to get him to drop the case in Oklahoma.

Then on the next page, page 9, paragraph 14, some of that conduct that Mr. Soloway engaged in to try and get back at Microsoft -- he posted a press release saying he had formed this organization. He was going to e-mail information to 1,940,000,000 Internet users, making these allegations against Microsoft, because they had filed an
action against him.

So this is the kind of stuff I wanted to emphasize to the Court in terms of the defendant's conduct against people who attempt to stand up to him. And if the Court -- I would offer Exhibit 1 and Exhibit 1.10.

MR. TROBERMAN: No objection.

THE COURT: Exhibit 1.1 and Exhibit 1-10 will be received.

MS. WARMA: Then if we move to 1.10-2, your Honor -- this is the affidavit from the process server swearing that he had attempted on 15 times to serve Mr. Soloway; that he could hear Mr. Soloway inside. He could hear people inside the condominium in which he lives, but no one would ever come to the door to accept service.

The next page -- the next page consists -- it is again an exhibit that was part of the Oklahoma case. It is a conversation that appears to have been engaged in by Mr. Soloway and another company that also challenged him for spamming activity, and Mr. Soloway's comments response begin on page 13 where it says --

THE COURT: Is that in the section that says response to --

MS. WARMA: Right.

THE COURT: -- illegal activities by Magic --

MS. WARMA: Right. The company Magic Myth had sent him a bill for spamming because he was spamming their servers, and so this is Mr. Soloway's response to them.

He is alleging that they are involved in fraudulent action, and they are involved in illegal action. And he's threatening to have them convicted with a felony -- and the next page -- that it will end up in their spending several years in prison for their felonious actions. And he goes on to bombast and threaten and make representations about actions that he is going to take against these individuals. And this e-mail is signed Robert, Seattle, Washington,
United States Minor Outlying Islands.

The next page, page 15, is a copy of one of these postings Mr. Soloway apparently made to forums about the Braver website -- I mean the Braver lawsuit, excuse me, and in this he is -- this is where we see some of these threats that he is going to initiate legal action against Mr. Braver, and he is trying to solicit other people to join in these lawsuits that he is allegedly going to file.

Page 17. This actually was a document that was part of the Braver case, but it is from the Microsoft lawsuit against Mr. Soloway, and in this particular thing, as you can see, is an order granting the plaintiff's motion for sanctions for defendant's failure to make discovery. He failed to comply with the directions of the Court in terms of his discovery obligations, and what the Court says there -- there is handwritten comments that the Court has also considered the pleadings and papers filed in this action and concludes, and then it says see page 2, the next page -- which is at Bates --

THE COURT: 18?

MS. WARMA: -- 19 -- woops, 18.

So this is the Court and hand writing in comments. The defendant's discovery violations have been willful and have caused substantial prejudice to the plaintiffs such that no lesser sanctions that that imposed would be effective or appropriate.

THE COURT: Well isn't that -- that is the language that the Court has to pretty much adopt if it is going to be entering those kind of sanctions on a civil case, isn't it?

MS. WARMA: Thank you, your Honor. I just wanted to emphasize the strength of the finding there.

Page 19 -- Bates pages 19 and 20 -- I don't think we have to look much closer. These are one of the postings, the press release that Mr. Soloway did -- this organization that he was going to form in order to take action against Microsoft because they had dared to file a case against him. Moving on to Exhibit 1.17, what this consists of, your Honor, is documentation with respect to the notices that were sent to Mr. Soloway in the Braver lawsuit in Oklahoma for appearance at the default hearing -- the motion for the default judgment.

The Court had set a June deadline for an answer. There was never an answer and the default motion was filed. The Court noted the hearing and this is notice of the transmission to him of those documents.

Then Exhibit 1.17-2 are more documentation from the defense attorneys to that the Court's direction sent to Mr. Soloway all of those notices by fax, by e-mail, and by mail. And that is documentation with respect to that.

1.18 is the minute entry from the default hearing indicating that Mr. Soloway failed to appear.

1.19, the default judgment that was actually entered by the Court and the permanent injunction and this is at Bates -- beginning at Bates page 34.

And part of what is recounted here is the attempts to serve Mr. Soloway and his representations that he didn't get service.

THE COURT: And with respect to the permanent injunction, can you outline the -- those aspects of the injunction that you are alleging by virtue of the activity that Mr. Soloway is accused of engaging in -- that would -- in this case that would actually violate the terms of that injunction?

MS. WARMA: Absolutely, your Honor.

Looking at page 37, Bates stamp, that is where the Court begins with the ordering adjudging, and decreeing that Mr. Soloway is permanently enjoined and restrained from -- and I would direct your attention to A) Initiating the transmission of a commercial electronic e-mail message to any computer involved in interstate commerce or a transactional or relationship message that contains or is a company by header information that is materially false or misleading.

And then moving down to paragraph E, relaying or retransmitting a commercial electronic mail message that is unlawful under the civil terms -- from a protected computer or network access without authorization.

This is the relaying. This is using proxy computers to hide the origin of the message.

THE COURT: And then turning to the indictment, is there information in the indictment that would indicate that after the date of this injunction, the defendant has violated those terms?

MS. WARMA: Yes, your Honor. That would be in the mail fraud part of the indictment because in that part of the indictment, we set out the entire scheme, and so I will find for you in the scheme and artifice to defraud section --

THE COURT: And the grand jury did find the time from November 28, 2003, through May of 2007?

MS. WARMA: Correct, your Honor.

THE COURT: Excuse me --

MS. WARMA: And that would be paragraph 27, your Honor, in the indictment. It was further part of the scheme and artifice to defraud that he -- the e-mails contained false and fraudulent headers, and there is more description in that in paragraph 28 -- the forging technique. In paragraph 29 the use of a multitude of servers with
different IP addresses to transmit millions of spam messages. Paragraph 30, the use of proxy computers for the relay of those messages to disguise their origin.

THE COURT: Thank you.

MS. WARMA: And I would like to offer, your Honor, Exhibits -- I believe we are up to 1-17 -- 1-17-2, 1-18, 1-19, 1-21-2, we've gone through all of those.

THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: No, your Honor.

THE COURT: They will be received.

MS. WARMA: Your Honor, next looking at Exhibit 1.21-2, this is the affidavit that Mr. -- excuse me, Mr. Soloway filed in the Braver lawsuit after the default judgment was entered in which he makes certain representations and those representations included what appear to have been false representations to the Court -- that he had never received any of the notices with respect to the hearing. He was not aware of the default judgment or the hearing until September 23, 2005.

The plaintiff in the lawsuit in their response filed a number of documents indicating that in fact Mr. Soloway had had notice prior to that time, and prior to the hearing -- one of those being an affidavit of an individual, and this is Exhibit 1.25-2, Susan Gunn, who sets forth a transcript from an e-mail conversation that she had with Mr. Soloway on September 22, for example, in which they are discussing the Braver lawsuit, and in fact he is again representing that he's not subject to the spam laws, or his spam is immune because it is not commercial.

Then Exhibit 1.26, which begins at Bates page 46, that is the final quarter of the Court at which it denies Mr. Soloway's motion to set aside the judgment in which the Court recounts again some of his misconduct in the context of that particular suit, and on the next page advising that Mr. Soloway, regardless of whether he perjured himself, has made -- has totally failed to follow the Court's orders in all of these various ways -- again imposing the permanent injunction against that particular type of activity.

So the government offer those exhibits, as well, your Honor.

THE COURT: Those exhibits being Exhibit 1-

MS. WARMA: 21-2, 1-25-2, and 1-26.
THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: No, your Honor.

THE COURT: They will be received.

MS. WARMA: Now I would like to refer the Court to what has been marked Exhibit 2, and that begins at Bates page 48. And this consists, your Honor, of, again, some conversation on an online forum between Mr. Soloway and another individual who is discussing his -- Mr. Soloway's default judgments that were entered against him, in
specifically the Microsoft lawsuit.

And if we go to the second page, page 49, this is Mr. Soloway's response. I am Mr. Soloway. My company will not be filing for bankruptcy. Microsoft will never collect a dime from me, nor has anyone ever collected a single dime from me from any lawsuit I have been in -- saying you don't know anything about this. The Microsoft lawsuit was just a lot of fun, ha ha ha. It doesn't matter if they receive a judgment for $8 million or $8 billion, Microsoft won't see a single dime as all of assets are protected.

And then the types of --

MR. TROBERMAN: Well, your Honor, if she is going to read part of a sentence --

THE COURT: That is correct. Because all assets are protected under the Washington State Asset Protection Act.

MS. WARMA: Correct. Correct, your Honor.

And down below: I have been sued for hundreds of millions of dollars and have had my business running for over 10 years without ever paying a dime, regardless of the outcome of any lawsuit.

And then he represents that he is a non-US citizen.

And then in the bottom paragraph of that particular communication: The only thing the Microsoft lawsuit did to me was help me with perjured discovery provided by them to be used for my foundation -- for the 38 class-action lawsuits being formed in 38 states as we speak for their violations of state spam laws -- the Computer Fraud Abuse Act, and the Canned Spam Act, and I would also like to refer the Court to the next page wherein this statement is continued.

You have no idea about -- there is only one winner in the Microsoft suit against me, me, and in regards to the Braver suit, if he doesn't drop the case on me -- and so the Braver suit was going on at this time -- shortly, I will bring it all the way to trial, costing him a fortune, and win, as I always -- do not to mention he will have about $500,000 in legal bills defending himself from some of the best legal firms in four states due to his previous abuses in the telemarketing and junk fax arena regarding previous individuals that used to reside near his location.

I always win -- regardless of the judgment amount. Losing is not an option, and I never, ever, ever have to pay a single cent to anyone.

The government would offer Exhibit 2.

THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: No, your Honor.

THE COURT: Exhibit 2 will be received.

MS. WARMA: I would like to refer the Court to Exhibit 3.

Exhibit 3 is a portion, an excerpt from the affidavit that was sworn in support of the search warrant for Mr. Soloway's apartment, and the purpose of adding that material in this case, your Honor, is that it explains in some further detail in paragraphs 30, 31, 32, 33, 34, 35, 36, 37, 38 -- what happened to many of the victims of Mr. Soloway's criminal conduct, and it recounts, for example, the story of a person, initials EO, in Texas, who bought his product believing it would work, and the efforts to go through to get the money, the refund that was guaranteed, and the fact, if you look, your Honor, at page 52 -- the last portion of paragraph 31 -- and that Nim has threatened to send a collection agency if he tries to reverse the charges.

This was recounted over and over and over again by victims in this case. I would also note that this particular individual that reported that Mr. Soloway and Nim charged him three different times for the product, $149, three different times, but what happened to this victim, what happened to countless victims, hundreds of victims is that when they attempted to get their money back on this money back guarantee you saw on the website, Mr. Soloway would immediately threaten them with collection. He would threaten to ruin their credit for seven years. He would indicate -- he would imply or suggest or state explicitly that they were stealing his product, and this is how he responded to people.

I would like also to draw your attention, your Honor, to paragraph 37, which is on page 54. The paragraphs beginning on that page reference a complaint that was filed with the Washington Attorney General's office by an individual, initials JN -- senior computer specialist with a government agency, the Santa Barbara Department of Social Services.

In the Paragraph -- the material that follows, this individual recounts how Mr. Soloway is spamming that government agency. He is spamming them using forged headers, which incorporate the names of employees who work at that agency. They cannot filter out the spam because to do so would totally shut down their ability to receive any e-mail, and if you go down, your Honor, to the subparagraph C, and this is very recently -- this was in April of 07 -- that individual is recounting that it is costing that agency $1000 a week to deal with spamming activity.

Going on to the next page -- there is just, I believe, another paragraph at the top -- other complaints about individuals whose identity has been stolen and forged into to and from headers.

And finally, your Honor, I would note that, and I am not sure that we need to go into it, but Exhibit -- so at this point I would offer Exhibit 3.

THE COURT: Mr. Troberman?

MR. TROBERMAN: No objection.

THE COURT: Exhibit 3 will be received.

MS. WARMA: And I would refer the Court to Exhibit 7.

Exhibit 7 consists of the conversations and the communications that took place between a customer of Mr. Soloway who purchased his product -- all of the e-mails back and forth when the customer was reporting that the product did not work, his attempt to get assistance with it. Mr. Soloway's failure to give him assistance with it, other than to tell him he needed to go to another ISP that would not block spam, and then this customer's attempt to get his money back.

This culminated in threats by Mr. Soloway that he would be referred to collection and if you go, your Honor, to page 88 -- you will see what many of these victims saw when they tried to have their money returned. This collection notice that the negative credit rating would be reported. And if you go down to the bottom paragraph, the statement that your financing and credit in the future for the next seven years will be affected.

THE COURT: Well, I will tell you -- I understand the point that you are making with respect to these individual customers in that regard. The tie-in that I don't see at this point, as it relates to those victims, is the issue that we are here for, which is the detention hearing -- if in fact Pretrial Services is recommending that he be separated from any computer and separated from Nim, which is what they have recommended in this case, it seems to me that the -- at least for those victims, or alleged victims in this case, there are a combination of conditions that can address the safety of the community, i.e., make sure that to the extent that those are crimes, and I'm not stating that they are, but those can be addressed.

I mean it is -- what I am concerned about is making sure that we are not in a situation where we have a person that is detained simply because they are not abiding by their product warranty information, and there are other issues that I think that you may want to focus on more than those particular -- than these particular victims -- not to suggest that these victims have not had a grievous problem, but that is not the issue that is before us right now.

MS. WARMA: Right. I understand, your Honor, and the final thing I would like to say at this -- about this particular victim and what is typical and why it is relevant, if you look at page -- what has been marked -- Bates stamped 93, this particular individual went to his bank, which was the Navy Credit Union, I believe, and he said, I believe I should get a refund for this product. They gave him a refund.

What you see at page 93 is a letter from Mr. Soloway to that bank saying, Oh, no, no, the product I gave him was exactly right. It works -- well, your Honor can read it -- indicating that -- representing that the customer is not eligible for a refund.

He was able to get the refund returned so that he actually was paid the money for the product, and what follows at page 94 is a letter from the customer to the credit union, again saying all of the reasons why there was fraud involved. He thinks he should get his money back. He never got his money back, and the point I wanted to make, your Honor, is this was typical behavior on Mr. Soloway's behalf. People complained to the Better Business Bureau, if people complained to their banks, he didn't let it rest. He went after them with those institutions. He wrote letters in response casting aspersions on those customers. And this, your Honor, I would submit goes to is risk of obstruction of justice.

But let me move on, and what I would like to address now, your Honor, are the finances, which we believe is very relevant to his risk of flight.

If your Honor would look please at what has been marked Exhibit 8, having read the indictment, your Honor, you will know that in there the government asked for a civil judgment in the amount of $773,000, which at the time of the indictment was the amount of money that we could ascertain from Mr. Soloway's financial records that had come in as payment for fraudulent product.

What we -- what the exhibit represents, eight -- what Exhibit 8 represents, excuse me, is an initial spreadsheet, which has been done since the time of the search warrant, in which we found invoices for this various product, and if your Honor will look at page 97, the total figure for invoices that could be found beginning, if your Honor looks over to the left, and I will see if I can do that – the earliest invoices that are included in this compilation begin in March of 2004, so that is four months past the time that we are initiating the charges, which were in November of 2003.

So this is the amount of money that apparently he billed from March 2004 through the date of the search warrant -- almost $1 million -- and if we extrapolate from the amounts of money he's earning based on these invoices, the amount should be over $1 million for the period at which our charges begin.

If your Honor looks to the financial affidavit that was filed in this case, and that is at Exhibit 4, and just for a minute now put Exhibit 8 aside, Exhibit 4 was the affidavit that was done by IRS agent Sylvia Race in preparation for the execution of the search and seizure warrants, and this begins at Bates page 56.

What the government was attempting to seize at that time were the only accounts that we could ascertain might currently contain funds. If you proceed through that affidavit, you will see Agent Race sets forth her qualifications, and then on the second page, page 57, summarizes the case -- on page 58 -- identifies the only four counts, and they are listed right there, that we believed were currently being used -- because what the agent discovered, if you proceed through this affidavit, is that Mr. Soloway opened and closed accounts rapidly, very rapidly. He was doing this constantly and he was moving money through accounts rapidly and erratically -- what
appeared erratically to us -- probably not erratically to him.

If your Honor goes, for example, to page 62 of that -- of the exhibits, looking at paragraph 25, Agent Race recounts in there that she has looked through all of these accounts; that she has determined from 2003 through 2006 he has generated income in excess of $1 million. That is longer than the period that we charged, but if you proceed downward, you will see some of the many bank accounts that
were opened and used during that period of time to move funds, and that information goes over to the next page.

By my count there are 14 different bank account, which were used during that period of time, and if you look at the total deposits at the bottom, through those accounts, during that period of time, $1,647,000 moved.

In addition, as Agent Race recounts, in addition to the 14 plus -- 14 at least bank accounts, she discovered ecommerce accounts including Google accounts, e-passport accounts, PayPal accounts, and eBay accounts, and if we go down to paragraph 28, he knew -- she was able to discover 18 PayPal accounts, for example. Those are just the PayPal accounts. Those aren't these other e-commerce accounts, and those are the accounts that were able to be associated with Mr. Soloway.

The point of all of this, your Honor, is we don't know where his money is. He made a lot of money. We don't know where it is. He was moving it through accounts constantly.

When the seizure warrants were executed on the date of the search -- of those four accounts, we found $5,000, and those funds were seized.

The agent was advised by an individual with e-passport, for example, that Mr. Soloway had wiped those accounts the previous weekend -- in a matter of days before the search.

So he was moving money constantly. We don't know where it is. He has made a lot of it.

And I would offer Exhibit 4 and Exhibit 8, your Honor.

THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: No, your Honor.

THE COURT: Exhibits 4 and 8 will be received.

MS. WARMA: And now I would like your Honor please to look at Exhibit 9.

THE COURT: Actually Exhibit 9 appears to be -- there's no entry for Exhibit 9 in the notebook.

MS. WARMA: And do you have --

THE COURT: Will it be on the --

MS. WARMA: It will be, your Honor. I apologize for that.

THE COURT: Actually, it is tabbed in with Exhibit -- now that I see it, it is tabbed in with – put in, in the Exhibit 8 section.

What are the Bates numbers for Exhibit 9?

MS. WARMA: Exhibit 9 begin at 98, and it goes through -- it goes to 103 -- through 103 --

THE COURT: I do have it. It was just placed in the tab for Exhibit 8. I do have the exhibits.

MS. WARMA: Okay.

Your Honor, Exhibit 9 represents, if you look up at the top, Soloway review and notes of search warrant inventory.

Okay, these are some notes taken by agents as they have moved through and tried to inventory records were found during the search warrants.

There is much material in here that is relevant to our determination today. Some of those things include, for example, applications and e-mails from offshore highrisk.com. He is going offshore to establish bank accounts.

Here is another one now displayed on the screen: Direct.com. Removing merchant account to an offshore bank, possibly Mexico, due to charge back issues and being on the TMF, terminated merchants file list.

And these are two items I want to talk about specifically which are of grave concern to the United States, and particularly relevant.

These entries we are referencing, and what I'm pointing to now -- copy of a check from -- we have redacted the name -- in the amount of $1876 -- copy of check from another redacted name, $1528.

There were two different -- the names of two different individuals redacted there. Those individuals were located and interviewed by agents with this case subsequent to the search -- the time these records were found.

What the agents learned is both of those were young men living in this area were asked by Mr. Soloway if he could use their PayPal accounts to move money that he generated in his scheme.

He represented to one of these individuals, just about the time this individual turned 21, that he was having problems with his credit, so could he please use this other young man's PayPal account to receive the proceeds of his scheme.

This young man, who was still living with his parents -- still lives with his parents -- agreed to that. He reported to the agents he was quite taken with Mr. Soloway's lifestyle. He was quite taken with the parties thrown by Mr. Soloway in his apartment. He was quite taken with Mr. Soloway's expensive car and the expensive meals that he would take him to, and his expensive clothing.

So this 21-year-old man agreed to do this and did it for several months. There was a point in time in April of 2007 where Mr. Soloway asked him also to use the business account belonging to his parents to process credit card transactions. The young man disagreed with that and Mr. Soloway then approached this second individual whose name is hidden -- to process proceeds for him through this other
individual's PayPal account.

The father of the first young man only learned of this activity on the day of Mr. Soloway's arrest. His son then told him about it. The father is very concerned because there may be some connection that has been made between his legitimate business and Mr. Soloway's criminal activity.

I would ask your Honor to turn to the next page, and this is Bates stamp page 99. And what you will see, your Honor, if you move through this particular page are a number of entries with respect to the rental of servers, but here is one I wanted to point out, too -- a communication with an Egyptian charity that want US e-mail addresses -- responds to questions are e-mails opt in? Yes. Again, this was this fraudulent representation that Mr. Soloway has made consistently and continues to make, that the e-mail addresses he is sending are opt in when in fact they are fraudulent e-mail addresses. And I would ask your Honor to look at the next page, page 100 -- again, other things that are showing up in his records, and one thing I wanted to note here -- a wireless prepaid cellular phone that was purchased, and scrolling down further, reference to payment for travel from Seattle to Barbados.

On the next page -- that is 101 -- another cellular phone. In fact when the search took place, four cellular phones were seized from Mr. Soloway's apartment.

And then I would like to go down and show what is a three-day trip, apparently, by Mr. Soloway, over -- if you go over to the other side you will see -- these items are dated around December 26 of 2006. Mr. Soloway makes a quick trip to New York, stays apparently at the Helmsley Hotel for three nights, and does a lot of shopping, and these are the kind of designer items -- there will be additional mention of them -- that were referenced by the young men in terms of their being impressed with the lifestyle that he was leading that allowed him to entice these individuals into his conduct.

On the next page, 102 --

THE COURT: I am not sure that I see that staying at the Helmsley Hotel -- how that relates to a detention hearing, though?

MS. WARMA: Well, your Honor, it pertains to the lifestyle, which was used as an enticement to others. It pertains to a lifestyle that is lavish and that is being experienced at the same time that judgments from two civil actions are outstanding against this individual, and he is dragging about, No one is ever going to touch his money.

THE COURT: But we don't -- we got rid of debtors' prisons a long time ago.

MS. WARMA: I know, your Honor, but I think it is -- it goes to his compliance with what a court has imposed, and his thumbing his nose at the authority of the Court, which is relevant.

And finally, your Honor, on the next page, again, an item of particular concern to the government, and that is a receipt for an item that had been purchased -- an Archos portable media device receipt -- Internet browser -- and the point I would I can make with regard to this, your Honor, is there are any number of ways that the defendant can access the Internet. This particular item I don't believe was found or seized during the search warrant. It does not take a computer, it does not take any particular specialty equipment that is difficult to get. He can walk into any store and buy the means to access the Internet. He can access the Internet through a cell phone.

And the final item I would like to note on this page begins here -- this may be a misspelling -- AtlanticTime.com receipt for model --

THE COURT: And which Bates number is it?
MS. WARMA: This is still on Bates 102, your Honor.

And what this appears to be is a watch that Mr. Soloway purchased for $1500, and the point I would like to make with respect to that, your Honor, is this is not an isolated type purchase. There were many receipts found in the records, purchases at Cartier, Tiffany -- purchases for expensive jewelry and watches -- things that were not found in the apartment when the search warrant was executed – things that could be easily converted to cash.

And the government would offer Exhibit 9, your Honor.

THE COURT: Any objection, Mr. Troberman?

MR. TROBERMAN: Your Honor, my only objection is that all this document purports to be are notes of an investigator who is reviewing certain materials, and it is filled with information that is irrelevant and quite frankly wrong.

The watch to which Ms. Warma made reference was a gift purchased by Mr. Soloway's parents who are here in court and can certainly testify to that. The reason the receipt was there was because it needed warranty work, and they sent him the receipt so he could have warranty work done.

THE COURT: I will receive Exhibit 9. I'm not sure I find the relevance to be the same -- of this exhibit to be the same as being urged by the government.

MR. TROBERMAN: Thank you, your Honor.

MS. WARMA: And finally, your Honor, we would offer, without additional -- much additional comment, Exhibit 10. Exhibit 10 is a copy of the lease agreement Mr. Soloway has executed for his Mercedes automobile.

Exhibit 11 is an initial inventory of items, designer clothing that were seized during the search warrant. So these are items that were seized because it was believed by the seizing agents that they could be reasonably sold for money in satisfaction of the judgment that the United States is pursuing. That is Exhibit 11, and as you will see, there are countless designer clothing items of the type, again, referenced by individuals who have been brought by Mr. Soloway into his criminal conduct.

And Exhibit 12, your Honor, is the initial valuation that has been done by the seizing agency -- in this case the IRS -- in which you can see the value that was put on there. For example, $3700 on the designer sunglasses, which were seized, and the outerwear, $13,000.

And the entry for the one bank account that held any funds, the West America bank account held $5,800 in funds, and those were the only funds that were found to be seized.

The government would offer Exhibits 10, 11, 12, your Honor.

THE COURT: Mr. Troberman?

MR. TROBERMAN: Your Honor, with the same comments I made with respect to number 10, we have no objection.

THE COURT: Exhibits 10, 11, and 12 will be received.

MS. WARMA: Thank you, your Honor.

I am done with exhibits. I would like to talk to you now about how all of that bears on whether Mr. Soloway should be released -- whether there is a serious risk that he will flee, and whether there is a serious risk that he will obstruct justice.

And in doing that I would like to also reference the factors set out in paragraph G, the first of which is the nature and circumstances of the offense charged.

I think your Honor has a sense at this point of the enormity of the scheme that went on. He has been charged by us only since the day that Mr. Soloway moved to the state of Washington, but by his own statements and representations, has gone on for 10 years.

We have hundreds of complaints from victims who have attempted to deal reasonably with Mr. Soloway. Instead of responding to them as he has represented, he has responded to them viciously. He has threatened them, and he has harassed them.

This is also true with respect to the victims of his illegal criminal spamming activity. He has aggressively come after people who have complained about that activity -- notably that activity, every day since a federal district judge in Oklahoma entered an order in 2005, is in violation of a standing court order -- in violation of that permanent injunction.

Mr. Soloway has demonstrated every day since then he has no intention, apparently, of any adherence to what a court orders, and we would suggest to you that that is the best evidence there could be of his -- his disrespect for the law, essentially, your Honor, and clear and convincing evidence to show that there is a risk that he will not adhere to any order this court imposes.

You have seen evidence with respect to his finances -- a substantial -- substantial amount of money has been earned by Mr. Soloway. We would suggest the evidence shows that, and it is not accounted for. He has gone to great lengths to hide his money, to deceive anyone who might be looking for it. We have no way of knowing how much assets are truly available to him and where they are. We know that he has purchased many items that could easily be hidden and resold. We think that goes as well to his risk to flee.

Finally, your Honor, I would like to emphasize that the criminal conduct here is conduct that occurred on the Internet. It is conduct that Mr. Soloway can engage in within a half hour or less of leaving this courtroom.

There is effectively, we would submit, no way to preclude him from getting access to the Internet, from arresting people who may be victims or witnesses against him. He has demonstrated that conduct over and over again, and there would be no reason to suggest he would act contrary to that pattern.

For those reasons, your Honor, we think that we have met by clear and convincing evidence the standards applicable. We would ask that he be detained.

THE COURT: Thank you, Ms. Warma.

Mr. Troberman?

MR. TROBERMAN: Yes, thank you, your Honor.

Your Honor, I will and be specific in responding to allegations made by the government and hopefully won't take up too much time, and then I would be happy to respond to any questions or concerns the Court has.

The government argues that there were thousands of customers who complained, but in reality, your Honor, if the Court looks at the search warrant in this case, there were approximately 100 to the Better Business Bureau or to the Attorney General, and the invoices that the government seized during the search in this case shows that Mr. Soloway had thousands and thousands of customers.

Granted there were a few that were unsatisfied, but most of those complaints that were received by the Better Business Bureau had to do with spamming and not fraud.

The government argues that he disregarded orders of the courts in Oklahoma and in this district in the Microsoft suit.

Mr. Soloway did not disregard orders of any court in that respect in that it is his right to default. The Court does not order someone to appear and defend against a lawsuit. There are ramifications if one doesn't, and judgments can be entered, but that is not a court order that says you have to come and spend hundreds of thousands if not millions of dollars defending yourself against a suit from Microsoft. If someone could be so weighted down by that that they just would choose the alternative of having a judgment entered against them, so be it, but it is not a violation of any court order.

THE COURT: I will go back to the same comment I made to the assistant United States Attorney: I recognize we have done away with debtors' prisons; nevertheless, the same cannot be said of a permanent injunction. It is indeed one thing to ignore a money judgment. It appears that the evidence proffered would suggest that the -- that Mr. Soloway has not been -- has been in active violation of a court's injunction, and a defendant is not free to actively violate an injunction.

MR. TROBERMAN: Your Honor, that really is --

THE COURT: There is a distinction --

MR. TROBERMAN: I do understand --

THE COURT: -- between the two.

MR. TROBERMAN: -- those distinctions -- between the injunction that was entered and whether or not it was entered by default.

I agree with the Court that it was a court order and he is subject to being regulated by the Court once that injunction was entered, but your Honor, that is really what this lawsuit is all about -- what this indictment is all about -- did he violate that injunction?

Certainly the government has been following this for several years now with that injunction in place and no effort was ever made to go back into court and argue that he was in violation of that injunction.

It seems to me that that would have been the appropriate starting place for the government to take up this matter, but Mr. Soloway disputes the allegations in the indictment. He has pled not guilty. He doesn't believe that he has violated the Canned Spam Act, and he has indicated in some of the e-mails and chat room documents that the government has submitted as to why he believes he wasn't in violation of that.

The government argues that he poses a threat to obstruct justice because he has harassed people or might somehow otherwise intimidate them, and I would like the Court to look at Exhibit 15, which -- Bates number 15, which is an example proffered by the government as to these socalled intimidation tactics that the government fears Mr.
Soloway will engage in.

That notice, your Honor, was obviously something that was prepared by a professional. If you compare the context and content of this document with other chat room postings by Mr. Soloway, it is obvious that this was not prepared by Mr. Soloway, but by some professional -- most likely lawyers who were seeking evidence to use in a lawsuit.

There is certainly nothing wrong with that. Lawyers do it all the time. There is nothing in here that in any way could be construed as unlawful or intimidating or anything else. It is seeking information because as I understand it, Mr. Braver is a serial filer who has filed dozens of complaints against any number of individuals, and there is nothing illegal or improper about filing countersuits and seeking information that would support that. That is part of the discovery process.

Exhibit 8, your Honor, is the invoices that were seized during the search of Mr. Soloway's residence and storeroom, and the government tallies up all of those numbers as if to say, Well, this is how much money he made, but your Honor, these are gross receipts. His net receipts are less than half of this.

It is interesting that the government that has both sides of the equation, only offers up the income -- provides nothing to the Court by way of the expenses of Mr. Soloway, which it has -- every document -- there is nothing transparent about Mr. Soloway's business. There is no cash sales. It is all done through merchant bank accounts, credit cards, PayPal, things like that. The government knows where every penny came from and the government knows where every penny went.

There are no cash withdrawals from his accounts in excess of $1000, and very few that even rise to that level.

They talk about a dollar figure from the bank accounts totaling $1,647,000, but that doesn't take into account, your Honor, transfers between bank accounts, so there is double and triple counting.

Please again are every dollar that went through the accounts, so if you have $100 in account A and transfer it to account B, it is going to show up in the government's tally as $200, where for the rest of the world it's $100.

Many of his accounts had automatic withdrawals to pay for credit cards. Mr. Soloway owes American Express over $100,000, and those amounts are deducted on a regular basis.

The government has had years to look at Mr. Soloway, and they know that he doesn't have any substantial assets, and it makes sense, of course, that he doesn't, because he has almost $20 million in judgments outstanding against him.

He doesn't own a house. He doesn't own a car. He doesn't own a boat or a plane or train or anything else. What he owns is a lot of clothes.

The government says, Well, we don't know where his money went, and then they submit exhibits here showing 24 pairs of sunglasses valued at thousands of dollars and so on and so forth.

Every penny that came into Mr. Soloway's accounts and went out of Mr. Soloway's accounts are accounted for by the government. He is cash poor. The government knows he has spent tens of thousands if not hundreds of thousands of dollars on lawyers in the Oklahoma case, and in the Microsoft case. They know every penny -- where it has come in and where it has gone out.

Now the government says, Well, we are very concerned because we see something about offshore bank accounts. Your Honor, I submit there is nothing in the record submitted by the government about offshore bank accounts. What there is was discussion about an application for an offshore credit card merchant. The reason for that is that his lifeblood was credit cards, and in order to make money in these kinds of sales, the typical payments were through credit card or PayPal.

And when one reaches more than 1% in chargebacks, the credit card companies simply terminate you. Some of the offshore merchant account are a little more liberal with those chargeback percentages, and so Mr. Soloway had applied for some offshore credit card merchants, but the money goes directly into his back account. It doesn't -- they are not banks. They don't his money. They just process the credit cards and then deposit it directly into his accounts here and the government knows of each and every one of those accounts.

The two individuals, the young men that the government referred to on the PayPal accounts, again was another effort by Mr. Soloway to have a method of receiving payment for the various products, and bear in mind again, your Honor, the vast majority of his customers were very satisfied customers, and so there was a lot of people out there who were receiving the product they wanted, and they got, and they used it and they liked it -- and they paid for it. But because of the problems he was having with the credit card merchants, he was seeking additional PayPal accounts, and he had these two individuals allow the use of their own private PayPal accounts to receive money, but those monies again tracked directly into Mr. Soloway's bank accounts. It is not like they went into those other people's PayPal accounts and were never seen again.

The government has the records that show that the money went from those individuals' PayPal account directly into Mr. Soloway's accounts. There is no missing money. The government said it was concerned because there was records of travel to Barbados. Your Honor, Mr. Soloway has never traveled outside the United States without being accompanied by his parents. These were typically cruises. There were a few of them. He has never gone out of the country on his own.

The New York trip over Christmas, I think the Court hit that on the head. It is -- you know, it is just not relevant to any of the issues here.

The Internet access, that was an MP3 player that the government was pointing out in one of its exhibits. I have told the Court about the watch.

Quite frankly, your Honor, Mr. Soloway has no assets to speak of, other than his clothing collection and the electronics that were in the apartment. Most of the money that comes in now goes back out to pay off his credit card debt and as the government said, he has lived a lavish lifestyle.

They wonder where the money went and yet they stand here and say, Well, he is living this lavish lifestyle. They themselves account for where most of his money went. Your Honor, there is nothing that I have heard in the government's presentation that suggests that Mr. Soloway is a risk of flight, and certainly there is nothing that suggests that he is a danger to the community.

The conditions that Pretrial Services has recommended will prevent him from having access to the Internet. The GPS will allow the government to keep track of him at all times.

This is simply not the type of case that pretrial detention was intended for.

You know, when the Bail Reform Act first came into play, it was intended that it would reach only a very few types of very egregious cases, and in fact certain presumptions were set forth in the statute for certain types of offenses. None of those types of offenses are present in this case, and it just seems to me, your Honor – quite frankly, when I got involved in this case, I was somewhat taken aback by the fact that the government would even urge Mr. Soloway's detention in this case. And I certainly don't think that they have shown by a preponderance of the evidence that he is a risk of flight, nor by clear and convincing evidence that he is a danger to anyone in the community or that he is a risk to obstruct justice.

The conditions set forth in the Pretrial Services recommendation are reasonable. We concur with them and we would ask the Court to release him on those conditions -- and I am more than willing, your Honor, to answer any questions the Court might have at this point.

THE COURT: No, I don't have any. Thank you, Mr. Troberman.

MR. TROBERMAN: Thank you, your Honor.

MS. WARMA: Your Honor, excuse me. I believe there is one victim who is here who would like to address the Court?

THE COURT: I will hear from -- briefly from that person.

MS. WARMA: And your Honor, this is Mr. MacLeod.

THE COURT: Mr. MacLeod -- actually, at this point, I will ask you to be sworn in.

WITNESS MACLEOD: Sure.

THE CLERK: Please raise your right hand.

Do you solemnly swear or affirm that the testimony you are about to give is the truth, the whole truth, and nothing but the truth, so help you God?

WITNESS MACLEOD: I do.

THE COURT: Would you state your full name, please?

WITNESS MACLEOD: My name is Wolf MacLeod.

THE COURT: And Mr. MacLeod, do you wish to address the Court as to issues that relate to this court's determination about detention issues, and specifically what I have in mind is -- what I'm governed by are two principal factors: The risk of danger to the community and the risk of flight -- and if you do, then I would be happy to hear any statement that you wish to make.

WITNESS MACLEOD: This man makes a living off of making millions of people absolutely miserable. He made me miserable for a number of months --

MR. TROBERMAN: Your Honor, I am going to object to this line of testimony. It is just about another victim.

It has nothing to do with the two issues that the Court --

THE COURT: I will permit him to continue for the current time.

WITNESS MACLEOD: I was a victim of his mail bombs and what we call being Joe jobbed where he uses our e-mail addresses in his mailings. We get all of the bounce back returns. He impacted my business severely, making it difficult for me to retrieve my legitimate e-mail. This went on for a long time. I received hundreds of thousands
of e-mails from this man and I do not think that he should be freed.

THE COURT: Thank you, Mr. Wolf.

Mr. Troberman, do you have anything?

MR. TROBERMAN: I don't, your Honor.

THE COURT: Mr. Wolf, thank you for coming and thank you for your statement.

WITNESS MACLEOD: Thank you.

THE COURT: You are excused.

The Bail Reform Act requires -- as passed by Congress -- requires the release of a person facing trial under the least restrictive conditions that will reasonably assured the appearance of the person as required and the safety of the community.

As a general proposition, and as is true in this case, Congress has directed that the government bear the burden by proving -- using a preponderance of the evidence standard that the defendant poses a flight risk and by clear and convincing evidence that the defendant poses a danger to the community.

I will find that the government has satisfied its burden in this case, and I will direct the pretrial detention of Mr. Soloway in this case.

I note that the defendant in this case does have dual citizenship. He is both a citizen of the United States and a citizen of Sweden.

In my judgment, in terms of looking through the Pretrial Services report, I see, even though he has been here three years, minimal ties to the Western District of Washington.

He has family in Sweden and has traveled extensively.

Now the grand jury in this case has found that there is probable cause that the defendant has engaged in aggravated identity theft and has been participating in fairly sophisticated crimes involving fraud in connection with electronic mail.

The defendant is obviously entitled to the presumption of innocence, which all defendants have in this case, and I stress that this is simply a probable cause determination by the grand jury. Nevertheless it seems very clear that the defendant is very sophisticated when it comes to the use of computers, and frankly, I believe issues relating to identity issues and travel documents would be something that would be relatively simple for this defendant to accomplish.

I am concerned in large part because of his prior conduct as it relates to court ordered injunctions. I do not believe that this court, sitting as a criminal court, should be a collection agency, and that is why I made the comments that I did -- that this -- we no longer have debtors' prisons. Nevertheless, it is -- and therefore I am not ordering him detained because he did not pay the judgments. There are civil means of forcing somebody to abide by judgments, which have been entered in a case.

Nevertheless the courts have entered -- excuse me -- the Court, at least the record before me, in Oklahoma, indicated that the defendant was permanently enjoined from certain conduct, which is the very subject matter of these particular criminal proceedings.

What that indicates to me is the defendant's unwillingness to abide by court orders and makes highly questionable the whole issue of whether he would comply with supervision in light of that prior conduct.

I am also concerned that the defendant in this case has been less than forthcoming about his assets. I am not again making any sort of finding or determination regarding a lavish lifestyle. There is nothing criminal with having a lavish lifestyle. There are -- creditors may be upset by a lavish lifestyle, but I am not upset by it -- in the context of making a detention determination about whether somebody lives a lavish lifestyle.

What I am concerned about is the possibility of assets being hidden in an area that would then permit somebody to continue if they left the jurisdiction, and what makes this especially troubling is that these are allegations of cyber crimes that respect no geographic borders. It would be, for example, just as easy to continue to do the activities for which the defendant has been indicted in Sweden as it would be here in the United States. And that is what concerns me -- particularly in light of the conduct as it relates to following prior court orders.

And I am concerned that there have been, in the past, attempts to -- attempts to -- some -- that could be categorized as intimidation -- when somebody has asserted certain legal rights.

I am not making a finding that the defendant has in fact attempted to intimidate somebody in this case; somebody is entitled to file counterclaims asserting their rights in this case, and I don't have enough information in front of me to make a specific determination as to whether there was intimidation.

Nevertheless, in light of the proffers, it is very easy, it seems to me, that again if one is outside of the jurisdiction, to continue with a course of conduct that is -- would fit in the context of intimidation for those who have stepped forward.

It is for all of these reasons that I will direct the continued detention of Mr. Soloway pending trial in this matter.

Ms. Warma, is there anything further on this matter for the government?

MS. WARMA: No, thank you, your Honor.

THE COURT: Mr. Troberman, is there anything further for Mr. Soloway?

MR. TROBERMAN: No, your Honor.

THE COURT: We will be in recess.

THE CLERK: All rise, the Court is in recess.

(End of proceedings for 6/13/2007)

Attachment	Date	Size
DetentionHearingTranscript.pdf	06/28/09 1:05 pm	244 KB

MOTION for Review of Detention Order

Robert Soloway's attorneys are asking Judge Pechman to review the magistrate's order that Soloway be detained until trial.

Among the claims:

• When he said that he isn't a US Citizen, he was just responding to taunting.
• When he threatened to release a list of Hotmail users in response to Microsoft's lawsuit, that was a "legitimate exercise in free speech."
• He is off his medications and his mental state is deteriorating.

===================================
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY,
Defendant.

DEFENDANT'S MOTION FOR REVIEW OF DETENTION ORDER

I. INTRODUCTION.
Robert Alan Soloway ("Robert" herein), was arrested on May 30, 2007. He is charged in a multiple count indictment, alleging violations of 18 U. S. C. §§1341, 1343, 1037 (a)(2), 1028A, and 1956. None of the offenses alleged in the indictment raises a rebuttable presumption that Robert, who has no prior criminal history, is a risk of flight or a danger to the community. See 18 U.S.C. §§3142(e) and 3142(f)(1).

A detention hearing was held on June 13, 2007. Despite the fact that Pretrial Services recommended a PR release with conditions, Robert was ordered detained by Magistrate Judge Donohue.

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II. ARGUMENT.

A. A MAGISTRATE'S ORDER OF DETENTION IS REVIEWED BY THE DISTRICT COURT DE NOVO.

Upon a motion for review of a detention order entered by a Magistrate Judge, the district court reviews the Magistrate Judge's findings and conclusions de novo. United States v. Koenig, 912 F.2d 1190 (9th Cir.
1990).
[The district court] should review the evidence before the magistrate and make its own independent determination whether the magistrate's findings are correct, with no deference.

* * *

The point is that the district court is to make its own "de novo" determination of facts, whether different from or an adoption of the findings of the magistrate. It also follows ... that the ultimate determination of the propriety of detention is also to be decided without deference to the magistrate's ultimate conclusion. Id., at 1193 (citations omitted).

B. ROBERT SHOULD BE RELEASED ON HIS PERSONAL RECOGNIZANCE, SUBJECT TO REASONABLE CONDITIONS.

18 U.S.C. §3142(b) provides, in relevant part, as follows:

The judicial officer shall order the release of the person on personal recognizance, or upon an unsecured property appearance bond in an amount specified by the Court . . . unless the judicial officer determines that such release will not reasonably assure the appearance of the person as required or will endanger the safety of any other person or the community. (emphasis supplied)

Pursuant to 18 U.S.C. §3142(c), if the Court determines that the release described in §3142(b) will not reasonably assure the appearance of the person as required or will endanger the safety of any person or the community, the Court shall order the release of the individual subject to the least restrictive further condition or combination of conditions
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that will reasonably assure the appearance of the person and the safety of the community.

The Ninth Circuit holds that in evaluating the government's motion for detention

. . . we bear in mind that federal law has traditionally provided that a person arrested for a non-capital offense shall be admitted to bail [citations omitted]. Only in rare circumstances should release be denied. [Citations omitted.] Doubts regarding the propriety of release should be resolved in favor of the defendant. [Citations omitted.]

Release pending trial is governed by the Bail Reform Act of 1984 which, like its predecessor, the Bail Reform Act of 1966 [citation omitted], mandates release of a person facing trial under the least restrictive condition or combination of conditions that will reasonably assure the appearance of the person as required. [Citations omitted.] The Fifth and Eighth Amendments' prohibitions of deprivation of liberty without due process and of excessive bail require careful review of pretrial detention orders to ensure that the statutory mandate has been respected.

United States v. Motamedi, 767 F.2d 1403, 1405 (9th Cir. 1985).

In determining whether there are conditions of release that will reasonably assure the appearance of the person as required, the court is directed by the statute to take into account the available information concerning the factors set forth in 18 U.S.C. § 3142(g). These factors include whether the charged offense is a crime of violence, a Federal crime of terrorism, or involves a minor victim or a controlled substance, firearm, explosive, or destructive device. 18 U.S.C. §3142(g)(1). The offenses charged in this indictment do not include any of the offenses enumerated in §3142((g)(1).

The legislative history clearly establishes that the drastic remedy of detention is to be reserved to extreme cases.

There is a small but identifiable group of particularly dangerous defendants as to whom neither the imposition of stringent release conditions or the prospect of release can
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reasonably assure the safety of the community or other persons. It is with respect to this limited group of offenders that the courts must be given the power to detain release pending trial.

Senate Report No. 225, 98th Cong., 1st Sess. 6-7 (1983) printed in 1984 U.S. Code Cong. and Ad. News 3182, 3189 (emphasis supplied). "The wide range of release conditions available ensures, as Congress intended, that very few defendants will be subject to pretrial detention." United States v. Orta, 760 F.2d 887 (8th Cir. 1985) (emphasis supplied).

C. PRETRIAL SERVICES HAS RECOMMENDED A PERSONAL RECOGNIZANCE BOND WITH CONDITIONS.

After conducting an investigation, Pretrial Services has determined that there are conditions of release that will reasonably assure that Robert will appear as directed, and that adequately address the issue of danger to other persons or the community. Thus, Pretrial Services recommended to Magistrate Judge Donohue that Robert be released on a personal recognizance bond, with conditions. Those conditions include, but are not limited to, the following:

1. GPS monitoring;
2. Surrender passports;
3. Undergo mental health evaluation and follow treatment recommendations;
4. Not use or possess a computer, PDA, cell phone, etc., with internet access.

We agree that these conditions that will reasonably assure Robert's appearance and the safety of other persons and the community. Thus, we concur with Pretrial Service's recommendations in this case.

D. THE GOVERNMENT'S EVIDENCE DOES NOT ESTABLISH THAT ROBERT IS A FLIGHT RISK.

The government's detention motion alleges that there is a "serious risk" that Robert
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will flee if released. The government must prove that a defendant would flee "by a clear preponderance of the evidence." United States v. Motamedi, 767 F. 2d 1403, 1406 (9th Cir. 1985). However, the evidence presented by the government did not support the conclusion that Robert is a flight risk, and many of the magistrate judge's findings in this regard are either not supported by evidence, or are not rationally related to the issue of risk of flight.

First, Magistrate Judge Donohue found that Robert "has dual United States-Sweden citizenship," and that he has family in Sweden. Findings Nos. 1 and 2. While both of those findings are true (Robert's mother is Swedish and thus he has dual citizenship), they have little to do with risk of flight in this case. Robert has an eighty-five year old maternal grandmother who lives in Sweden. She does not speak English. Robert does not speak Swedish. Robert last saw her five years ago when he accompanied his mother to Sweden to celebrate his grandmother's eightieth birthday. Prior to that trip in 2002, he was last in Sweden (with his mother) in 1987, when he was eight years old.1 Robert also has a few aunts and uncles in Sweden, but he doesn't really know them.

[1 Although the magistrate judge made no mention of it, Robert also traveled internationally in 2003, when he accompanied his parents on a cruise in Norway, and in 2006, when he accompanied his parents on a cruise that commenced in Barbados and ended in Puerto Rico. Other than as described above, Robert has not traveled outside the United States since the age of five, and in all of his international travels, including the trips mentioned above, he traveled with his parents.]

Magistrate Judge Donohue also apparently found it significant, and thus made a finding, that Robert "had once boasted that the legal process will not affect him, stating that 'I am a Non-US citizen. "' Finding of Fact No. 1. That comment was made by Robert on an email marketing forum (similar to a chat room) on May 17, 2005, in
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response to taunts regarding the Microsoft lawsuit. See Government's Exhibit 2 (Bates No. 000049), a copy of which is attached hereto as Exhibit A. In actual fact, the statement about being a non-US citizen was not in the context of the legal process not affecting him. The full paragraph where Robert stated that he is a non-US citizen read as follows:

I'm a non-US citizen and will not file for bankruptcy, nor will my company, nor have I ever in the past, nor have I ever had any debt to the IRS with the taxes I gladly pay to them every year . . . EVER. Feel free to quote me on that one. Quit acting like you have a clue, because you don't. You know absolutely nothing. Like I said, its nice to finally see someone on this board that is truly clueless.

More troubling in both its lack of support in the record and its reasoning is Finding of Fact No. 4, in which the magistrate judge found that

The grand jury has found that there is probable cause to believe that the defendant has engaged in aggravated identity theft and sophisticated crimes involving the use of a computer and electronic mail. It is apparent that defendant is quite experienced and adept in the use of computers. The creation of new identities and travel documents would be a relatively simple task for the defendant.

While it is true that "the grand jury has found probable cause to believe that defendant has engaged in aggravated identity theft," there is no support in the record that Robert committed "sophisticated" crimes involving the use of computers; that Robert is adept in the use of computers; or that the creation of new identities and travel documents would be a relatively simple task for Robert.

Count 18 of the indictment charges Robert with aggravated identity theft involving the alleged unauthorized use of a credit card "to register and pay for the domain name 'colidsilver.com,' which domain was used to host the NIM website. . ." According to
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the owner of the credit card, there was an unauthorized $20.00 charge for the foreign purchase of the domain name colidsilver.com. Robert purchased that domain name from another individual, and did not know that the name had originally been purchased with a stolen credit card. It would make no sense for Robert to use a stolen credit card to purchase a domain name that was associated with his business. That would be similar to Robert using a stolen credit card to purchase items and then having the items delivered to his own home, where they could be easily traced to him. It defies reason and common sense to believe that anyone would use a stolen credit card to purchase a domain name that they actually intended to use. Nor would it make sense that Robert would use a stolen credit card to avoid a $20.00 payment, given the substantial income that the government alleges Robert was earning.

Counts 19 through 22 also charge aggravated identity theft, but on a completely different theory. In those counts, Robert is alleged to have sent emails with a header showing the recipient's name as both the sender and the recipient, e.g., from "JohnSmith@yahoo.net" to "JohnSmith@Yahoo.net." It is alleged that by sending emails in this manner, they were less likely to be rejected by a spam filter. It would be the same as sending an envelope through the mail using the addressee's name and address as both the sender and addressee. There is nothing "sophisticated" about sending such an email. Even more importantly, it does not follow that based on his ability to send an email in this manner it would also be a relatively simple task for Robert to create new identities and travel documents. Indeed, the government never argued that Robert possesses sophisticated computer skills. On the contrary, the government has communicated to the undersigned that it doesn't believe that Robert's alleged crimes require much computer
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knowledge or skill. Nothing in the record supports the conclusion that Robert would be able to create, or have easy access to, identification or travel documents. It should also be noted that the government has Robert's Swedish passport in its possession, and the undersigned has Robert's U.S. passport, which we have offered to surrender to the Clerk's Office.

Magistrate Donohue also found that

Defendant has not been candid about his financial assets. It appears that he has been involved in establishing off-shoreaccounts, placing funds in others [sic] names, and in setting up electronic accounts for later access.

Finding No. 7. This, too, has little support in the record. The government argued that it did not know what happened to Robert's money. It alleged that he had gross receipts over the last five years totalling approximately $1,000,000, but offered no evidence regarding his expenses, even though all of his business records had been seized by the government and were in the government's possession. The government also complained of Robert's "lavish" lifestyle, but refused to concede that this may have been where much of his money went. The defense proffered that Robert had little or no cash on hand or in the bank (he owes American Express over $100,000), and that his assets consist mainly of his extensive collection of clothing and shoes. Robert does not even own a car. Unfortunately, we could do little more than proffer this information, since all of the actual records have been seized by the government. The government did not carry its burden on this issue.

More importantly, there is not a scintilla of evidence that Robert has established or maintained an offshore bank account, or that he has any assets offshore. The only
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evidence relating to anything offshore was a reference to a blank application from an offshore credit card processor that was found in Robert's apartment. See Transcript of Hearing at p. 36. There is no evidence that Robert ever actually used an offshore credit card processor, but even if he did, that wouldn't mean that he had any money offshore. Credit card processors merely process credit card payments for a fee, and then deposit the funds in the merchant's account. That is all done by wire, so the physical location of the processor has nothing to do with where the money ends up.

There is no mystery to Robert's finances. All of his internet transactions were conducted using credit cards, checks, or secondary payment facilities such as PayPal. No cash payments were involved. All of the funds flowed into Robert's bank accounts, and are easily traceable. The only findings made by the magistrate judge that arguably address the actual issue of risk of flight are Findings No. 5 and 6. We do not dispute the fact that the court in Oklahoma entered an injunction, enjoining Robert from conducting certain activities, and that the grand jury has found probable cause to believe that Robert has violated the terms of that injunction. But it does not necessarily follow that because Robert may have violated the terms of a civil injunction, he will not comply with Court orders in this case and will flee the jurisdiction. At best, it is grounds to believe that Robert poses a risk of flight.

But the Bail Reform Act doesn't stop there. The Act provides that the Court shall release an individual on personal recognizance or an unsecured property bond unless such release will not reasonably assure the appearance of the person as required. Then, and only then, the judicial officer shall order the release of the person subject to the least
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restrictive further condition, or combination of conditions, that will reasonably assure the appearance of the person. 18 U.S.C. §1342(a), §1342(b), and §1342(c)(1)(B). We submit that the conditions recommended by Pretrial Services will reasonably assure Robert's future appearances.

D. THE GOVERNMENT'S EVIDENCE DOES NOT ESTABLISH THAT ROBERT IS A DANGER TO ANOTHER PERSON OR TO THE COMMUNITY.

Magistrate Judge Donohue also made a curious finding regarding "threats" allegedly made by Robert against people who have filed complaints against him. Finding No. 8. This finding is curious, because after first declaring that he was "making no specific findings regarding witness intimidation," he then observed in the same Finding that "[R]etribution the defendant has previously shown against those who have complained can just as easily be handled through the internet from abroad. "

First, it is important to clarify that no physical threats against anyone have ever been alleged. Nor is it alleged that Robert ever sent out viruses or "spyware." The alleged "threats" involve legitimate responses to actions--actions that in many cases were improper--that were taken against Robert. One example proffered by the government was a broadcast email seeking information on Robert Braver, who was at the time suing Robert. A copy of the email, which was admitted as Exhibit 1-10-2, Bates No. 000015, is attached hereto as Exhibit B. This court can judge for itself whether such an email can legitimately be called a threat making Robert a danger to another person or the safety of the community.

The government also referred to a second allegation in the same pleading from the Braver case (Exhibit 1-10, Bates Nos. 00005-9), this time complaining that Robert's
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counsel (not Robert) had sent a letter to Braver's counsel "stating, in essence, that [Soloway] would file a defamation lawsuit in California" against Braver unless Braver agreed to dismiss his lawsuit in Oklahoma. Threats of counterclaims are not at all unusual in litigation, and the actions of Robert's lawyers, who were doing their job and presumably acting within the Code of Professional Responsibility, do not constitute "danger" to anyone.

In yet another paragraph from the same pleading, which the government offers as another example of threats of intimidation (See Transcript at 17), it is alleged that Robert sent out a broadcast email attempting to intimidate Microsoft in the wake of Microsoft's lawsuit against Robert. A copy of the first and last pages, which were all that were offered in evidence (Exhibit 1-10-2, Bates No. 000019-20) is attached hereto as Exhibit C. Clearly, this is not an improper threat, but merely a legitimate exercise in free speech.

Another example of alleged threats and intimidation is found in Exhibit 1-10-2, Bates No. 000013-14. A copy is attached hereto as Exhibit D. In that matter, MagikMyth, International, Inc., sent a collection notice to Robert in the sum of $10,000. The problem was, there was no legitimate debt owed to MagikMyth. MagikMyth had never commenced a legal action against Robert, and thus had never obtained a judgment against him. Instead, they simply sent him a bill for $10,000, claiming that that was the penalty for sending them an unlawful spam. When Robert didn't pay, they sent a collection notice, in an effort to intimidate Robert into paying this illegitimate invoice. There does not appear to be anything unlawful in Robert's response to this "shake-down" attempt by MagikMyth, and certainly nothing in his response that would justify finding Robert a danger to any person or to the safety of the community.

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The only other alleged "threats" by Robert involved his responses to customers who had obtained charge-backs through their credit card company without following NIM's return policy, who then apparently wanted a refund from NIM as well. Robert responded by explaining the refund policy, and further explained that if the customer didn't pay for the product, they would be turned over to collection. See, Exhibit 3.

Where the government requests that an individual is to be held without bail due to that person's dangerousness to the community, the government must prove by clear and convincing evidence that the defendant is one of those rare individuals who pose such a danger to the community that they must be detained. See, United States v. Motamedi, supra; United States v. Walker, 808 F.2d 1309, 1310 (9th Cir. 1986). In fashioning conditions to assure the safety of the community, the courts are not to attempt to guarantee the safety of others in the community. United States v. Orta, 760 F.2d 887, 891 (8th Cir. 1985). Rather the courts are to consider what will reasonably assure such safety. One need look no further than the legislative history of the Bail Reform Act quoted above (at p. 4) to see that the evidence in this case does not rise to the level of dangerousness contemplated by the Act (certainly not by clear and convincing evidence). But even if it did, there are conditions that will reasonably ensure the safety of other persons and the safety of the community (e.g., a condition denying Robert access to the internet).

E. THE FDC IS UNABLE TO TAKE CARE OF ROBERT'S MEDICAL NEEDS.

Prior to his arrest, Robert was suffering from anxiety, depression, and Tourette's Disorder. A variety of medications was keeping these afflictions under control. The primary medications Robert was receiving were clonazepam (Klonopin), which he has been taking in small dosages for six years, and venlafaxine (Effexor). Unfortunately, Klonopin
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is not on the BOP formulary. During the first 45 days of his incarceration at the FDC, the medical staff weaned him off of the Klonopin (which is an addictive drug). The results were predictable. On August 1, 2007, Robert was seen by the medical staff, who noted:

"[Robert] appears miserable, c/o shaking, cold sweats, vomiting, trembling, racing heart, twitching, runny nose."

He was also complaining of severe anxiety, with suicidal thoughts, and involuntary body twitching that was keeping him up at night. It was noted that his Tourette's had previously been successfully treated with Klonopin, and the Tourette's symptoms were once again prominent in the absence of the Klonopin. A copy of the BOP, Psychological Data System, Consultation Sheet is attached hereto as Exhibit E-1. Dr. Grant Haven, the contract psychiatrist at the FDC put in a request for non-formulary drug authorization, providing as reasons:

Patient has extensive treatment history with many failures for his Tourette's and anxiety. Clonopin helps both. Tics prevent him from sleeping. Now 72 hours without sleep. No substance abuse history.

Dr. Haven also listed the other drugs that are on the BOP formulary that were tried without effect. These included Prozac, Paxil, Zoloft, Luvox, Effexor, Buspar, Haldol, Orap, and others. See copy of Non-Formulary Drug Authorization, attached hereto as Exhibit E-2. On August 17, a chart note confirms that the BOP denied the non-formulary request. A copy is attached hereto as Exhibit E-3.

Upon receiving notice that the BOP had denied the doctor's request for non-formulary drug authorization, the undersigned contacted Robert J. Palmquist, the warden at FDC SeaTac. Warden Palmquist then personally contacted the appropriate individuals at BOP headquarters in Washington, DC, with a request that the FDC be allowed to
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provide Robert with Klonopin. That request was also denied, without explanation.

As a result of the BOP's unjustified refusal to prescribe Klonopin, or any other generic drug from the same family of drugs, Robert's Tourette's symptoms have returned with a vengeance, particularly the uncontrollable body tics. His anxiety level has also increased dramatically, even reaching the point where he is experiencing suicidal ideation. Despite the fact that Robert has not been convicted of anything, and that he is presumed innocent, he is being treated by the Bureau of Prisons as though he is a convicted felon, not a pretrial detainee. Unless his medical conditions are brought under control, Robert will not be able to assist his counsel in his defense.

F. THE FDC WILL NOT ALLOW ROBERT TO HAVE ACCESS TO A COMPUTER.
Robert has been notified by the staff at the FDC that due to the nature of the charges in this case, he will not be allowed access to the computer room to review discovery in this case. The discovery consists of tens of thousands of pages. We have also been told that there is no place to keep paper copies of the discovery in this case at the FDC. While the legal staff and warden have confirmed to the undersigned that they will attempt to comply with any court order, they have also stated that it will create a severe hardship on the FDC, and will put a strain on their resources.

The Assistant United States Attorney and the undersigned have agreed not to reproduce the discovery until we know whether Robert will be released or detained. Clearly, we would prefer to have a copy of the discovery in an electronic format. However, if Robert remains detained and will not have access to a computer, then it will have to be done in paper form. That will be very expensive, and Robert does not have funds available to pay for copying the vast amount of documents in this case.

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III. CONCLUSION.

For all of the reasons hereinabove set forth, there are conditions that will reasonably assure Robert's appearance at all future hearings in this case, and that will also assure the safety of other persons and the community. Accordingly, we concur with Pretrial Services' recommendation for release, and further concur with the conditions they have recommended. Robert is also willing to abide by any other condition the Court may deem appropriate.

DATED this 6th day of September, 2007.

RICHARD J. TROBERMAN, P.S.
Attorney fbr Defendant
Robert Allen Soloway

Attachment	Date	Size
MotReviewDetentionOrder.pdf	06/28/09 1:05 pm	670.55 KB
MotReviewDetentionOrderExhs.pdf	06/28/09 1:05 pm	764.39 KB

Petition to Modify Conditions of Release

This document does NOT also include the original document.

Included in the document is a description of several mental conditions that Soloway has been diagnosed with and I'm not so heartless as to post that sort of information at this stage of the proceedings.

This will have the text version with that information redacted.

============================
United States District Court
Western District of Washington

Report on Defendant Under Pretrial Services Supervision
Name of Defendant
SOLOWAY, Robert

Bond Conditions Imposed:

6. Halfway house placement with release privileges as determined by Pretrial Services. You are required to make payments towards your subsistence at the halfway house in an amount determined by the halfway house, but not to exceed 25% of your income and/or the current daily rate. Pretrial Services will coordinate the defendant's release with the U.S. Marshals.

8. Travel is restricted to King County, Washington, or as directed by Pretrial Services. or as directed by Pretrial Services.

20. Undergo a mental health, psychiatric or psychological evaluation and follow all treatment recommendations in that evaluation, as directed by Pretrial Services. You shall take all medications as prescribed. 26. The defendant shall participate in the Workforce Development Program which may include participation in employment workshops, enrollment in a training or educational program, and/or actively seeking employment as directed by Pretrial Services.

30. Provide Pretrial Services with any requested information regarding your financial status, income sources, and investments. Sign a Release of Information form for Credit Bureau Verification if requested by Pretrial Services.

41. You shall not possess any Social Security number, identification, or documents in any name other than your own.

23. Do not use or possess a computer or electronic media, e.g. PDA (Personal Digital Assistant) and cellular phones, with internet access capabilities, or have anyone else on your behalf use or access a computer or electronic media, without prior approval of Pretrial Services. Do not access the internet, bulletin board systems, or private or public computer networks. Do not have others access, on your behalf, the internet, bulletin board systems, or private or public computer networks without prior approval of Pretrial Services.

45. Other The defendant shall not be self-employed in any cavacity. All employment shall be pre-approved by Pretrial Services.

35. You must contribute towards the costs of the services required by this bond, to the extent you are financially able to do so, as determined by Pretrial Services.

43. Comply with all other court orders or terms of supervision.

PETITIONING THE COURT

* To modify the conditions of supervision

DELETE:

Halfway house placement with release privileges as determined by Pretrial Services. You are required to make payments towards your subsistence at the halfway house in an amount determined by the halfway house, but not to exceed 25% of your income and/or the current daily rate.

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ADD;
Participate in the active Global Positioning Satellite Program and abide by all requirements of the program, under the direction of Pretrial Services.

Maintain residence as directed. Do not change residence without prior approval of Pretrial Services or as directed by Pretrial Services.

Submit to drug and alcohol testing, to include urinalysis, breathalyzer, or hand-held devices, as directed by Pretrial Services. You shall not use, consume or possess alcohol or any other product containing alcohol, including medication, unless prescribed to you by a physician and'under the direction of Pretrial Services. Obtain an evaluation for substance abuse/alcohol abuse counseling as directed by Pretrial Services.

CAUSE

The defendant has been a resident of Pioneer Fellowship House since his release from custody on September 18, 2007, According to halfway house staff, the defendant has been following all rules and regulations of the halfway house program and remains in full compliance with all program requirements. The defendant is also in full compliance with the conditions of bond and Pretrial Services supervision.

On October 9, 2007, the defendant began working full time at Leathercare, in Seattle, Washington, earning $9.00 dollars per hour. The defendant is responsible for checking in and ticketing clothing which has been in house fires. The clothing is then cleaned and returned to the owners. While the defendant does use a computer to do his work, Pretrial Services has confirmed with the defendant's employer that the computer does not have an Internet connection and the defendant has no access to client's financial information or access to cash or negotiable instruments. The defendant's supervisor stated the defendant is a quick learner and is proving to be a very good employee.

[REDACTED]

[REDACTED]

On October 19, 2007, this officer met with the defendant's parents who are currently in Seattle to secure a reasonably priced apartment for the defendant, in hopes the defendant will be released from the halfway house. The defendant's parents spoke candidly about the defendant's mental health issues and legal situation and indicated in no way did they want to enable the defendant. They are willing to pay the defendant's monthly rent and will not tolerate the lavish lifestyle the defendant was leading prior to his arrest. On October 22, 2007, the defendant's father, Herb Soloway, called this officer to report they were able to secure an apartment in the same building as the defendant's current apartment, for a third of the rent the defendant has been paying.

If the defendant is allowed to release from the halfway house, this officer recommends the defendant be ordered to submit to random drug and alcohol testing. The defendant stated to this officer he has remained clean and sober since releasing from custody, but felt the random testing would be a good incentive to maintain long term sobriety.

If allowed to release from the halfway house, it is also recommended the defendant be ordered to participate in the Global Positioning System (GPS) monitored closely by Pretrial Services Specialist, Brenda Amundson. With GPS, Officer Amundson would know the defendant's location at any given time. All movements by the defendant would require advanced approval. GPS would cost Pretrial Services $8.95 per day versus the halfway house which costs

$95.00 per day, currently being paid by Pretrial Services. The halfway house serves as short term transitional housing for defendants. It is Pretrial Services' goal to transition defendants out of the halfway house and back into the community within 30 days, thereby conserving the halfway house resource for other defendants. Strict monitoring of the defendant can be accomplished with the defendant residing at his own residence, with the added conditions of GPS and random substance abuse testing, to ensure he is not a risk of non-appearance or a risk of danger to the community.

The Assistant United States Attorney, Kathryn Warma, is opposing the defendant's release from the halfway house as she stated Pretrial Services can not control people coming to the defendant's residence with devices which would allow the defendant to access the internet. There are many internet cafes in close proximity to the halfway house were the defendant currently resides and although against the halfway house rules, many residents have cell phones with internet access. Frequent unannounced home visits by Pretrial Services will ensure the defendant has no computer equipment in his apartment.

Defense counsel has been notified and concurs with the recommendation. As noted above, the Assistant United States Attorney does not concur with the recommendation.

I declare under penalty of perjury that the foregoing is true and correct.

Executed on this 23rd day of October 2007

Approved By.
Timothy W. McTighe
Chief U.S. Pretrial Services Officer

Connie Smith
Deputy Chief U.S. Pretrial Services Officer

THE COURT FINDS PROBABLE CAUSE AND DIRECTS:

* The Modification of Conditiops as noted above

J. Pechman, U.S. Ditrict Judge

Date: October 26, 2007

Pro Hac Vice for Carl Anthony (Tony) Capozzola

An Application Leave to Appear Pro Hac Vice has been filed by Carl Anthony (Tony) Capozzola, an attorney in California who specializes in high-profile criminal defense cases, who has joined the defense team for Soloway. His former clients include Michael Jackson and Tommy Lasorda.

Pro Hac Vice is a means for an attorney who is not admitted to practice before a particular court to do so without having to be fully admitted. It generally means that you have to have a local attorney vouch and take responsibility for you, and a fee paid for the privilege. It's not an automatic thing, but there's not likely to be any opposition to it.

===============================
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON

United States of America
Plaintiff(s)

v.

Robert Alan Soloway and
Newport Internet Marketing Corp
Defendants

APPLICATION FOR LEAVE TO APPEAR PRO HAC VICE

Pursuant to Local General Rule 2(d) of the United States District Court for the Western District of Washington, CARL ANTHONY CAPOZZOLA hereby applies for permission to appear and participate as counsel in the above entitled action on behalf of ROBERT ALAN SOLOWAY.

The particular need for my appearance and participation is:

I have been retained by Client as co-counsel in this case. I am a long-time acquaintance of Mr. Soloway's family and they have requested that I participate in his defense.

I, CARL ANTHONY CAPOZZOLA understand that I am charged with knowing and complying with all applicable local rules;

I have not been disbarred or formally censured by a court of record or by a state bar association; and there are no pending disciplinary proceedings against me. I was subject to a disciplinary proceeding 23 years ago that did not involve moral turpitude. I have been in good standing and active in State and Federal Criminal Defense since that time.

I declare under penalty of perjury that the foregoing is true and correct.

I have enclosed the required filing fee of $75.00

APPLICANT'S NAME: CARL ANTHONY CAPOZZOLA

APPLICANT'S FIRM: The Law Offices of Carl A. Capozzola
APPLICANT'S ADDRESS (Street Address Room/Suite): 1611 S. Catalina Ave., #300, Redondo Beach, CA 90277
PHONE NUMBER (include area Code): (310) 316-6055

STATEMENT OF LOCAL COUNSEL

I am authorized, and will be prepared, to handle this matter, including trial, in the event the applicant is unable to be present upon any date assigned by the court.

RICHARD J. TROBERMAN
LOCAL COUNSEL NAME

6379
WASHINGTON STATE BAR NUMBER

RICHARD J. TROBERMAN, P.S.
LAW FIRM

520 Pike Street, Suite 2510, Seattle, WA 98101-4006
APPLICANT'S ADDRESS (Street Address Room/Suite)

(206) 343-1111
PHONE NUMBER (include area code)

ORDER

IT IS ORDERED that the application of to appear and participate in this action is hereby approved.

DATED this day of June 20, 2007.

BRUCE RIFKIN, CLERK
UNITED STATES DISTRICT CLERK

Stipulation Continuing Motions and Trial

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY,
Defendant.

STIPULATION CONTINUING MOTIONS FILING DEADLINE AND TRIAL DATE

Plaintiff United States of America and defendant ROBERT ALAN SOLOWAY, by and through their respective undersigned counsel of record, hereby stipulate and agree to continue the motions filing deadline from June 20, 2007, to December 3, 2007, and the trial date from August 6, 2007, to January 7, 2008. This continuance is requested, and required in the interest of justice, for the following reasons.

Defendant Robert Soloway is charged in a 35 count indictment that was returned on May 23, 2007. Charges include mail fraud, wire fraud, fraud in connection with electronic mail, aggravated identity theft, and money laundering. Mr. Soloway was arrested on May 30, 2007, and his present counsel entered an appearance in this case on June 7, 2007. A detention hearing was held on June 13, 2007, and Mr. Soloway was ordered detained pending trial.

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Discovery in this case is voluminous, and includes tens of thousands of pages of documents, bank records, credit card records, ledgers, computer files, emails, and other items. Many of these records go back more than four years. Given the brevity of time and the sheer volume of the material, defense counsel has not yet been able to review all of the discovery materials. Moreover, counsel for the government and Mr. Soloway are still in the process of determining what format to copy these materials so that Mr. Soloway will have access to them and can assist his counsel in his defense. Accordingly, defense counsel is not in a position to determine what pretrial motions may be appropriate, nor can he be adequately prepared for trial by the presently scheduled trial date of August 6, 2007.

The parties agree that a continuance of the motions filing deadline and the trial date are necessary pursuant to 18 U.S.C. §§3161(h)(8)(A), (B)(i), (B)(ii) and (B)(iv); that the ends of justice served by granting the requested continuance outweigh the best interest of the public and the defendant in a speedy trial; and that the period of delay resulting from this continuance shall be excluded in computing the time within which the trial of this matter must commence.

The parties request a continuance of the motions filing deadline from June 20, 2007, to December 3, 2007, and of the trial date from August 6, 2007, to January 7, 2008. There have been no prior requests for a continuance. Contemporaneous with the filing of this Stipulation, Defendant is filing a Waiver of Speedy Trial through January 31, 2008.

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DATED this 20th day of July, 2007.

RICHARD J. TROBERMAN, P.S.

By: ____________________

RICHARD J. TROBERMAN
WSBA #6379
Attorney or Defendant
Robert Alan Soloway

JEFFREY C. SULLIVAN
United States Attorney

By: ____________________

KATHRYN A. WARMA
Assistant U.S. Attorney

Attachment	Date	Size
ScheduleStipulation.pdf	06/28/09 1:05 pm	111.94 KB
ScheduleStipulationOrderProposed.pdf	06/28/09 1:05 pm	59.96 KB

Minute Order

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY,
Defendant.

MINUTE ORDER

The following Minute Order is made by direction of the Court, the Honorable Marsha J. Pechman, United States District Judge:

Defendant has filed a motion to seal search warrant applications and returns and to seal his memorandum in support of the motion to seal. (Dkt. No. 18.) On the record before the Court, it is not clear whether Defendant has complied with Local Criminal Rule 53(d), which provides as follows:

Nothing in this rule or any other criminal rule of this court is intended to restrict the media’s right to full pretrial coverage of news pursuant to the First Amendment to the United States Constitution. To assure this right, notice of presentation to the court of any motion for an order affecting the news media’s right to full pretrial coverage of pending or impending criminal proceedings must be served by movant upon designated representatives of the principal public media at least twenty-four hours prior to presentation. The designated representative or representatives shall have the right to be heard by the court, in open court, at the time the motion is presented.

See also In re Search Warrant for Northwest Enviroservices, Inc., 736 F. Supp. 238, 239 (W.D. Wash. 1989) (holding that former Local Criminal Rule 53(e) permits members of principal public media to be heard on a motion to seal).

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Within three judicial days of the date of this Minute Order, Defendant is directed to file proof that he complied with the provisions of Local Criminal Rule 53(d). If Defendant has not yet complied with this rule, he may either: (1) correct this omission by serving notice of his motion to seal on designated representatives of the principal public media; or (2) withdraw his motion. Defendant shall notify the Court which option he intends to pursue by August 30, 2007. If Defendant chooses the first option, he must file proof of service with the Court and must inform the designated representatives of the media that they shall have seven calendar days after service of the motion to file and serve a response.

Date: August 23, 2007

BRUCE RIFKIN, Clerk

By /s/ Mary Duett
Deputy Clerk

Attachment	Date	Size
MotSealMinuteOrder1Amd.pdf	06/28/09 1:05 pm	11.74 KB

Government's Response in Opposition to Motion to Dismiss

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY, and
NEWPORT INTERNET MARKETING,
Defendants.

GOVERNMENT’S RESPONSE IN OPPOSITION TO MOTION TO DISMISS AGGRAVATED IDENTITY THEFT COUNTS

The United States of America, by and through Jeffrey C. Sullivan, United States Attorney for the Western District of Washington, and Kathryn A. Warma, Assistant United States Attorney for said District, files this Response in Opposition to the Defendant’s Motion to Dismiss Counts 19 - 25 of the Second Superseding Indictment.

I. Introduction

Defendant Robert Soloway (“Soloway”) argues in his Motion to Dismiss that the seven counts of Aggravated Identity Theft charged against him should be dismissed outright because: 1) the defendant’s conduct “was not aggravated in the sense that it was not the type of conduct for which the statute intended enhanced penalties to apply,” and 2) the identity theft conduct charged in counts 19-25 “is already covered” in Count 18 (alleging Fraud in Connection with Electronic Mail, in violation of 18 U.S.C. §1037(a)(3)). Motion to Dismiss, at pp. 4, 7. As will be demonstrated below, defendant’s assertions are meritless. The motion relying upon them should be denied.

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II. The Statute
The “Aggravated Identity Theft” statute provides, in pertinent part:
§ 1028A. Aggravated identity theft
(a) Offenses.-
(1) In general. - Whoever, during and in relation to any felony violation enumerated in subsection (c), knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person shall, in addition to the punishment provided for such felony, be sentenced to a term of imprisonment of 2 years.
. . . .
(c) Definition. - For purposes of this section, the term “ felony violation enumerated in subsection (c)” means any offense that is a felony violation of -
. . .
(4) any provision contained in this chapter (relating to fraud and false statements), other than this section or section 1028(a)(7);
(5) any provision contained in chapter 63 (relating to mail, bank, and wire fraud). . .

[1 Section 1037 is contained in the “chapter” (Chapter 47, Title 18, United States Code) referenced in subsection (c)(4).]

The statute thus clearly provides that a perpetrator of any number of federal felonies - specifically including §1037, (“fraud in connection with electronic mail,” 1) as well as mail and wire fraud - is criminally responsible for the additional crime of aggravated identity theft if, “during and in relation to” those other crimes, he or she also “knowingly transfers, possesses, or uses, without lawful authority, a means of identification of another person.”

The term “means of identification” is in turn defined for purposes of 18 U.S.C. §1028A, in 18 U.S.C. §1028(d)(7) as, “any name or number that may be used, alone or in conjunction with any other information, to identify a specific individual . . .” The statute goes on to identify, by way of example and not of limitation, an expansive list of possible identifiers that includes, inter alia: name, “unique electronic identification number, address, or routing code,” and “ telecommunication identifying information.”

III. Argument

A. Soloway Knowingly, Willfully, and Repeatedly Engaged in Egregious Acts of Identity Theft that Fall Squarely within the Terms of the Aggravated Identity Theft Statute

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From November 2003, until his arrest in May of 2007,2 Robert Soloway devised and executed a multi-faceted criminal scheme that generated over a $1,000,000 in proceeds. The scheme can be summarized as follows:

[2 Evidence exists to show that Soloway had run the same scheme, likely for years, in California and Oregon before moving to Washington in 2003.

Soloway created and published a series of Internet websites on which he touted his “low cost,” but purported high return “distribution email” advertising product and service; i.e., Soloway was offering to sell a software product that would enable the customer to send out their own high volume e-mail ads, or to send out “distribution email” ads on behalf of the customer. Soloway, however, made numerous material false and fraudulent representations on these various websites - most notably including the purported “opt-in” character of the e-mail addresses used in the “distribution email” product and service, but also regarding the availability of customer support and payment of “ full 100%” refunds, “no questions asked,” to product customers.3

[3 Because Soloway executed his scheme to defraud by way of interstate wire communications (in publishing the websites) and by sending materials (the “product” he promoted and sold) through the mails and commercial interstate carriers, he has been charged with both wire and mail fraud (Counts 1-16, Second Superseding Indictment).]

Soloway promoted and advertised his websites - and thus his scheme - by indiscriminately blasting the Internet and e-mail users world-wide with hundreds of millions - likely even billions - of “spammed” e-mail commercial messages. These spammed messages were transmitted in violation of two separate subsections of the “CANSPAM Act,” as codified at 18 U.S.C. §1037, because Soloway routinely used “proxy” computers to relay his spam, (§1037(a)(2)), and also routinely materially falsified header information (§1037(a)(3)). As the Court will hear at trial, these two techniques are common “spammer” tools which, if used in combination, effectively mask the two primary and most obvious means of identifying the source of a spammed e-mail message.4

[4 The use of “proxy” relays to transmit e-mail conceals the identifying Internet Protocol (“IP”) address of the true originating computer, and the falsification of the “from” field in headers conceals the text-based name of the message “sender”.]

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Soloway went beyond these “basic” spammer ruses, however, by choosing to engage in substantially more aggressive tactics involving the theft and unauthorized use of e-mail addresses and domain names that had been purchased and were owned by actual people, who were individually identifiable therefrom. As explained more fully below, and as will be proved at trial, these individuals suffered harm financially, as well as to their names and reputations, as a direct result of Soloway’s knowing, intentional, and repeated theft of their identities in furtherance of his mail and wire fraud scheme, and in relation to his felony “CANSPAM” Act violations.

“Spamming 101"

In order to best understand the significance of Soloway’s identity theft crimes, it is useful first to review some spamming “ basics.”5

[5 The government will present an expert witness at trial who will provide testimony on these and other aspects of “spam,” including what it is, how it’s distributed, how spammers profit, and the damages it causes and financial costs it creates for everyone who uses the Internet, but particularly for small Internet businesses and Internet Service Providers (“ISPs” ). See also: Fighting Spam for Dummies, J. Levine, M. Levine Young, and R. Everett-Church, Wiley Publishing, 2004; and Canning Spam, J. Poteet, Sams Publishing, 2004]

Unlike telemarketers or junk mailers, spammers can almost instantaneously6 “blast” their commercial advertisements at a barely perceptible financial cost to virtually hundreds of millions of recipients, world-wide. Also, unlike telemarketers or junk mailers, the costs of doing so do not measurably increase with an increase in the volume of the target audience. Consequently, spammers routinely seek to maximize their “mailing lists,” based on the assumption that the chances of a financial return (often from the “sale” of something fraudulent) will increase proportionately with the size of the receiving audience. The spammers themselves typically incur no additional costs for spamming ever more addresses - even if many of the e-mail addresses are bogus or invalid and therefore “bounce back” when they can not be delivered as addressed. Creating ever larger e-mail address lists (either for their own use or for sale,) is therefore a constant goal of spammers.

[6 Indeed, the speed and immediacy of spam has made it a favored technique for natural disaster and “catastrophe” fraud.]

-5-
One method of creating and “bulking up” e-mail address lists is through “dictionary attacks.” This typically involves the use of a computer program to generate long lists of possible names that are then appended to a known - or even a similarly generated - domain name. For example, a series of generated names (Alice, Ann, Amy), could be attached with the “@” symbol to the domain name: “usdoj.gov.” Spammed messages could then be blasted to every one of those computer generated email addresses in the hope that one or more would by chance be valid. An example of a “dictionary attack” list is appended as Attachment A.7

[7 This particular list was contained on one of the “product” CDs that was advertised and sold by Soloway from his website. Although Soloway represented (fraudulently) that the product he sold contained valid and “opt-in” e-mail addresses, the (defense contracting company) that owns the domain name, “amiinter.com” has confirmed that these 400 email addresses built on the domain name “amiinter.com” are neither valid nor “opt-in.”]

Another method of obtaining e-mail addresses and domain names is through “address harvesting.” Address harvesting has also become “ automated” with the use of computer programs designed to “ crawl” the Internet, visit websites and databases that might contain e-mail addresses or domain names, and compile those for the “harvester.” Address harvesting has the advantage of yielding lists of addresses and domain names that may well be valid, insofar as they were surreptitiously stolen, without permission, from active website or databases. The existence of these harvested addresses or domain names does not, however, in any way signify permission by the owners of the same to be included on spam address lists for which they have never, in any sense, “opted in.” Evidence will be presented at trial to prove that Soloway was using “harvested addresses,” in addition to “dictionary attacks” for his illegal spam.

Regardless of whether a spammer gets address lists from dictionary attacks, address harvesting, or (as in Soloway’s case), from a combination of both, the addresses on those lists need only be inserted (again, via an automated program) into the “ to” field in a spam “header” in order to blast the spam messages off, in bulk, to those separate addresses. In order to conceal his/her identity as the “sender,” the spammer can then manipulate or forge the “from” field in the header either to contain a
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false, fabricated, or non-existent name, or even to be blank. Spammers can, and most often also “rotate” a variety of false and fabricated names in the “from” header, as they continue to blast out repeated multiple versions of the same spam message - again, in an attempt to maximize the number of spam messages they send and hope will be received, without regard to the desires of, or impact on the target audience.

Anti-Spam Measures

Spam is universally regarded within the Internet community as a costly, invasive and deleterious “scourge.” It is commonly estimated that spam usurps 80% or more of Internet “bandwidth,” and costs Internet users billions of dollars annually. Some of those costs are spread among the universe of all Internet users; others are suffered in particular by ISPs and by small Internet-based businesses. Spam is also recognized as the “delivery mechanism” for pernicious fraud and “phishing” schemes, pornography, and a host of “malware” that includes viruses, worms, trojans, and spyware. The economic and societal costs of spam have driven law-making bodies world-wide to enact both civil and criminal “anti-spam” statutes. Reputable ISPs have uniformly adopted rigorous anti-spam policies that are incorporated into their terms of service. Subscribers who are identified to have violated an ISP’s anti-spam policies can and often have their accounts terminated, thereby ending their ability either to send or receive e-mail from that address. Anti-spam products and services have also been developed and made commercially available. These include a variety of “spam filtering” products and services, as well as “spam blacklists.”

Simply stated, spam filtering is designed to keep spam out of systems, networks and “in-boxes.” Filtering can be done with a variety of technical approaches and systems, and with a varying range of efficacy, and cost. None among these products or services is “perfect,” however. No filtering can stop all spam, and some can even result in “ false positives,” which means that legitimate e-mails, too, will be blocked.

Spam “blacklists” are developed by a variety of online organizations (some nonprofit, some commercial), based on data compiled from Internet traffic that is identified
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as spam or spam-related. The blacklists are then used in conjunction with filtering products and services to exclude spam with those identifiers, and by ISPs to terminate accounts identified on the blacklists or to block incoming traffic from those accounts.

Soloway’s Knowing, Willful, and Repeated Acts of Identity Theft in Furtherance of Wire Fraud and CANSPAM Act Violations

Evidence at trial will establish that Soloway was keenly aware of anti-spam measures including filtering, and ISP anti-spam policies. Indeed, his repeated, knowing and willful use of legitimate e-mail addresses and domain names, including those paid for and belonging to identifiable individuals, without their permission and against their expressed will, was a tactic that he intentionally embraced and exploited, in the words of his own counsel, precisely “to circumvent . . . spam filter[s].”8 This particular tactic enables the spam sender to thwart spam filters because the e-mail recipient can not filter based on his/her own e-mail address - as to do so would effectively preclude any e-mail addressed to the recipient, from being received by the recipient.9 It is thus a means to force the owner of any given e-mail address either to continue receiving the spam, in perpetuity and in whatever volume it arrives - or to surrender that e-mail address or domain name. Surrendering an established e-mail address or domain name can be financially devastating to a small business that has built its reputation on it from its inception.

[8 Motion to Dismiss, at p. 2, line 18.

9 Some advanced filtering products or services can possibly defeat this tactic by relying on “scores” or factors independent of the “from” information. These products or services, however, are not necessarily available - or within the financial or technological reach - of all Internet users.]

Soloway thus proved himself a savy and aggressive spammer who deliberately tailored his spamming techniques to defeat protections put in place to defeat spamming, and who was absolutely indifferent to the consequences of his actions to his innocent victims. Soloway also was aware - but resolutely indifferent to - the fact that many of these victims often suffered yet again - when they were blacklisted as a result of his spamming activity because their legitimate and individually identifiable e-mail
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addresses and domain names had been identified with spam that he - not them - had sent, and was responsible for.

All of the aggravated identity theft counts charged in this case involve victims whose experiences with Soloway shared common traits. 10 Most of the individuals (identified by their initials for purposes of the Indictment) began receiving spammed email messages, sometime during the period from 2005 until 2007, that contained advertisements for, and a link to Soloway’s (fraudulent) websites. As is typically the case with spam, these spammed messages came over, and over. And to the horror of each of these individuals, the messages included a header that identified the recipients themselves as the “sender” of spam that advertised a company they had never heard of and had nothing to do with. None of the recipients had “opted-in” to receive any such spammed advertisements, and none wished to be associated in any way with a company responsible for spam. Most of these individuals contacted Soloway repeatedly, and requested that he stop using their e-mail addresses and domain names in spam. Soloway ignored these requests, and continued to spam, using the e-mail addresses and domain names owned by these victim individuals, despite their voiced objections. In some cases the spam even increased. Several of these victims will testify further that they received either “bounce backs” to their addresses, indicating that Soloway had forged their addresses into the “from” header into spam he had sent to third parties, or complaints directly from third parties who blamed them for spam. And finally, several of these victims will testify that they subsequently were blacklisted by one or more ISPs or filtering services, because the e-mail address or domain name they owned - and that had been used by Soloway without their authority - had become identified as having an association with spam. Their individual reputations, and those of their businesses were compromised; they lost customers and the ability to do business on-line.

[10 The victims associated with counts 19 - 26 are but a representative sample of many more who were identified during the investigation as suffering like experiences.]

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By way of illustration, additional details regarding two of these individual victims are
as follows:

Count 19: R.M. will testify that he had registered and purchased a domain name that consisted of his combined first and last name, followed by “.net” . Beginning in March of 2005, his wife (with a different name and who used an entirely different email account, ) began receiving spammed advertisements from several different companies. R.M’s wife had not opted-in to receive any such spammed advertisements. The header of these spams identified the “ sender” with one of a variation of names “at” the domain name owned and registered to R.M. R.M. had no association with any of these companies, nor had he authorized any one to use his personal, individually identifiable name for spamming. R.M. contacted two of these companies, and was told they had each hired Soloway, relying on his representations that he would send “broadcast emails” to “opt-in” e-mail lists on their behalf. Both companies complained that Soloway had defrauded them, and was instead spamming advertisements for their company to recipients who were not opt-in, and from whom they had received complaints. R.M. did some investigatory work of his own, and located a phone number for Soloway. He called the number to complain about the unauthorized use of his individually identifiable domain name - a domain name he had purchased and registered. The person answering the telephone hung up on him. R.M. called again and asked to speak to the owner or manager. The person answering the phone hung up on him again. 11 Spam with R.M. ’s individually identifiable domain name continued, causing R.M. to file a complaint with the FBI.

[11 Numerous victims have reported that Soloway - who was the sole owner/operator and employee of his company - routinely hung up if they telephoned to object or complain. Soloway would stay on the phone if the customer was placing an order for service or product.]

Count 20: T.C. will testify that in September, 2005, he began receiving spam at several domain names and e-mail addresses that he owned, including an “individually identifiable” e-mail address that consisted of his first and last name, at
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“universalbyte.com”. The spam advertised, and contained links to Soloway’s websites. T.C. had never opted in to receive this spam, and was distressed to see that the headers were forged in a way to make it appear as though the spam had been sent by him, from his own e-mail addresses and domain names. T.C. received up to 200 such spams daily. T.C. also received “bounce backs” to his addresses and domain names, indicating to him that spam with his addresses forged into “from” header fields had been transmitted to others. T.C. used the “unsubscribe” tool on Soloway’s website, and also sent e-mail to the administrative contact identified in a WHOIS lookup of Soloway’s website to demand that the spam using his addresses be stopped. The spam from Soloway with T.C. ’s individually identifiable e-mail address forged into header “ from” fields continued. T.C. was forced to close his main e-mail address, which had been his primary work e-mail address. Domains owned by T.C. , the names of which Soloway had forged into “ from” headers in spam, were also blacklisted by AOL and Hotmail, forcing him to give up ownership of those domain names, as well.

The e-mail addresses and domain names of R.M, T.C. , and all of the other victims named in the aggravated identity theft counts either consist of, or contain their own individual names, or consist of a company name that is unique and either “alone, or in conjunction with . . . other information,” identifies a specific individual. They are thus “means of identification,” as that term is defined for purposes of 18 U.S.C. §1028A. They were “knowingly transferred, possessed or used” by Soloway, “without lawful authority” - forged by Soloway in the headers of spammed messages that were intended to further his wire/mail fraud scheme, and that were sent in violation of two separate provisions of 18 U. S.C. §1037. The victims themselves contacted Soloway to object and to direct him to stop the identity theft, thereby confirming the fact (and his
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knowledge) that the identities he had stolen belonged to “actual people” who did, in fact, object to their theft and unauthorized use.12

[12 As noted by the Defense in their Motion to Dismiss, there is a split among courts as to the mens rea requirement of 18 U.S.C. §1028A, with this Court holding in United States v. Beachem, 399 F. Supp. 2d 1156, 1158 (U.S.D.C. W.D. WA. 2005) that “knowingly, ” as used in §1028A applies to “another person. ” That standard is met in this case, because Soloway was repeatedly notified by the identity theft victims themselves that he was using their identities without their authority, and must stop doing so. Soloway brazenly continued to use their stolen individually identifiable e-mail addresses and domain names even after these objections were made.]

Soloway’s knowing, intentional and repeated egregious acts of identity theft fall squarely within the terms of the Aggravated Identity Theft statue. To the extent that any factual disputes over these violations exist, they properly should be resolved by the jury at trial. United States v. Beachem, supra, at 1158.

B. The Egregious Acts of Identity Theft Committed Repeatedly by Soloway and NIM Constitute Offenses Separate and Distinct From What is Needed to Charge Violations of 18 U.S.C. § 1037(a)(3)

While not characterized as such, defendant’s argument that the aggravated identity counts are “covered” by the §1037(a)(3) count is essentially one that these counts are multiplicitous. An indictment is multiplicitous if “it charges multiple counts for a single offense, producing two penalties for one crime and thus raising double jeopardy questions.” United States v. Stewart, 420 F.3d 1007, 1012 (9th Cir. 2005). Counts within an indictment are not, however, multiplicitous if “ each separately violated statutory provision requires proof of an additional fact which the other does not.” Id.

[T]he test to be applied to determine whether there are two offenses or only one, is whether each provision requires proof of a fact which the other does not . . . A single act may be an offense against two statutes; and if each statute requires proof of an additional fact which the other does not, an acquittal or conviction under either statute does not exempt the defendant from prosecution and punishment under the other.

Blockburger v. United States, 284 U. S. 299, 404 (1932). “Congress has the power to establish that a single act constitutes more than one offense, at least as long as each offense requires proof of a fact the other does not.” United States v. Stearns, 550 F.2d 1167, 1172 (9th Cir. 1977); See also: United States v. Rude, 88 F.3d 1538 (9th Cir.
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1996), (indictment using same wire transfers as basis for wire fraud and money laundering is not multiplicitous).

The crimes defined in sections 1028A(a)(1) and 1037(a)(3) of Title 18 are distinct offenses, requiring proof of different facts for conviction. Conviction under §1037(a)(3) requires proof that: 1) in, or affecting interstate commerce, 2) the defendant materially falsified header information, 3) in “multiple” commercial e-mail messages, and 4) that defendant intentionally initiated the transmission of those messages. Conviction under §1028A(a)(1) requires proof that: 1) during or in relation to one of the enumerated felonies, 2) the defendant knowingly transferred, possessed or used, without lawful authority, 3) a means of identification of another person. Proof of one of these offenses does not satisfy proof of the elements of the other.

They are not multiplicitous.

IV. Conclusion

Whereas a prosecutor “plays a strictly advisory role in sentencing decisions. . . [he or she] retains almost absolute discretion in charging decisions.” In re Morgan, 506 F.3d 705, 711 (9th Cir. 2007). “In our system, so long as the prosecutor has probable cause to believe that the accused committed an offense defined by statute, the decision whether or not to prosecute, and what charge to file . . . generally rests entirely in his discretion.” Bordenkircher v. Hayes, 434 U. S. 357 (1978).

Evidence well beyond the probable cause - even beyond the reasonable doubt - level, exists to support the §1037(a)(3), as well as the separate and distinct §1028A(a)(1) charges in this case. Defendant’s Motion to Dismiss Counts 19 - 25 should be denied.

DATED this 14th day of February, 2008.

Respectfully submitted,

JEFFREY C. SULLIVAN
United States Attorney

/s/ Kathryn A. Warma
Assistant U.S. Attorney

Attachment	Date	Size
MotDismiss19-25Opp.pdf	06/28/09 1:05 pm	100.06 KB

Reply to Governments Opposition To Motion To Dismiss

IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY,
Defendant.

REPLY MEMORANDUM IN SUPPORT OF MOTION TO DISMISS COUNTS 19-25 OF THE SECOND SUPERSEDING INDICTMENT

The government largely responds to defendant's motion to dismiss Counts 19 through 25 by giving a general dissertation on spamming ("Spamming 101"). However, what the government has scrupulously avoided mentioning is that spamming is not unlawful. The CAN-SPAM Act of 2003 ("Controlling the Assault of Non-Solicited Pornography and Marketing Act"), which became effective January 1, 2004, established requirements regulating--but not banning--unsolicited bulk commercial electronic email (commonly known as spam). In its continuing effort to demonize Mr. Soloway, the government describes numerous malevolent spamming practices ("pernicious fraud and 'phishing' schemes, pornography, and a host of 'malware' that includes viruses, worms, trojans, and spyware" and "natural disaster and catastrophe fraud"), even though it knows that it lacks any evidence that Mr. Soloway was engaged in such activities.

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Whether Mr. Soloway violated the CAN-SPAM Act is not the subject of this motion. What is the subject of this motion is whether or not Mr. Soloway committed aggravated identity theft. For the reasons set forth in the underlying motion, as well for the reasons hereinbelow set forth, it is clear that Mr. Soloway did not engage in aggravated identity theft to which that statute was intended to apply.

II.
ARGUMENT.

A. FORGING A HEADER IN AN EMAIL DOES NOT CONSTITUTE AGGRAVATED IDENTITY THEFT.

Mr. Soloway does not dispute that he sent bulk unsolicited emails that contained forged headers. That conduct, if it involved commercial email, is arguably prohibited by 18 U.S.C. §1037.' Mr. Soloway used a macro option in a lawful email sending software program that automatically replaced his email address in the header with the email address of the intended recipient of the email. A copy of the macro option is attached hereto as Exhibit A. Each email in which a recipient's email address was placed in both the "To" and the "From" portion of the header was unique, and only one email with this unique combination was transmitted to the recipient by Mr. Soloway. Despite repeated, but unsupported, claims by the government, Mr. Soloway did not send emails to third parties using anyone else's email address in the header. The macro option used by Mr. Soloway (See Exhibit A) was not capable of inserting an email address other than that of the recipient's email address in the "From" header.

[1 The CAN-SPAM Act, and 18 U.S.C. §1037 apply only to commercial electronic email.]

Nevertheless, we concede that this motion may not be ripe for determination due to the government's as yet unsupported claim to have evidence that Mr. Soloway did more
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than simply substitute the recipient's email address for his email address in a header. The government has been long on rhetoric and short on evidence in advancing this claim. With the exception of Count 19, the government has not produced to the defense in discovery a single email which it claims was sent by Mr. Soloway to a third party using someone else's email address (someone other than the recipient) in the "From" portion of the header. If Mr. Soloway was sending out millions of such emails as the government alleges, surely there would be some evidence to support its claims of forged headers in emails to third parties. Yet, with the exception of count 19, the government has failed to produce even a single copy of such an email. The reason for the failure of production is clear: no such emails were transmitted by Mr. Soloway.

Count 19 refers to an individual identified by the initials R.M. The government has produced copies of three emails that appear to have been sent to R.M.'s wife which identify some form of R.M.'s domain name in the header as being the sender of the emails to his wife.' However, if Mr. Soloway was using R.M.'s domain name to send spam email to third parties, R.M. should have received hundreds or even thousands of "bounce backs" of emails that could not be delivered due to invalid email addresses. The government has produced no evidence of such bounce backs.

[2 Defendant believes that this occurred not as a result of anything intended by him, but rather as a result of some forwarding program between R.M's email and his wife's email. Both email domains were set up at the same time through the same ISP. The chances of this having occurred coincidentally are astronomical.]

The government does claim that T.C., who is identified in Count 20, received "bounce backs to his addresses and domain names, indicating to him that spam with his addresses forged in the 'from' header fields had been transmitted to others." However,
-4-
the government has not provided the defense with so much as a single copy of a bounce back message. T.C., like all of the people identified in the indictment, and like most people who have email addresses, received spam from more than one source. Lists of email addresses are routinely bought, sold, and traded over the internet, so if a person received spam from one source, it is likely that they also received spam from other sources as well. Thus, it is not enough for the government to proceed as though all spam on the internet came from Mr. Soloway. They must produce independent evidence to support each count of the indictment.

Although we acknowledge that the Court may not be able to resolve this motion at this time because of the government's claimed evidence of Mr. Soloway sending emails to third parties with forged headers, we believe that the Court can make an advisory ruling as to whether the narrow act of substituting a recipient's email address for Mr. Soloway's address in the header of an email constitutes aggravated identity theft pursuant to 18 U.S.C. §1028A. Such a ruling could help the parties determine whether a disposition short of trial in this case is possible.

B.
18 U.S.C. §1037(a)(3) PROSCRIBES DEFENDANT'S CONDUCT.

Under the government's theory, almost any violation of 18 U.S.C. §1037(a)(3) also constitutes aggravated identity theft. That is clearly not what Congress intended by the aggravated identity theft statute. The alleged "use" of someone's identity by inserting a person's email address in the "from" header of an email that is sent to the very same person is far too tenuous to come within the grasp of 18 U.S.C. §1028A. That statute was clearly intended to punish a person who uses another person's identity directly in connection with some fraudulent scheme (e.g., to open bank accounts, obtain loans or
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credit, obtain employment, etc.). The only thing that occurred in this case as a result of the forged header was that an email may have avoided a spam filter. Surely, that is not what Congress had in mind when enacting 18 U.S.C. §1028A. Indeed, the legislative history makes it absolutely clear that this was not the kind of conduct intended to be subject to the severe enhanced penalties for "aggravated" "identity" "theft."

The government's response to the argument that Mr. Soloway's conduct is already covered by 18 U.S.C. §1037(a)(3) is typical. The government claims that it can charge Mr. Soloway's conduct under both statutes, not because it is the right thing to do, but rather because it has the unchecked power to do so. We disagree. If the statute is not broad enough to encompass the conduct alleged, then no amount of power will support such a charging decision.

Accordingly, we respectfully request the Court to find that merely substituting the recipient's email address for the sender's email address in the header of an email does not constitute aggravated identity theft in violation of 18 U.S.C. §1028A.

DATED this 19th day of February, 2008.

RICHARD J. TROBERMAN, P.S.

Richard J. Troberman
Attorney or Defendant
Robert Alan Soloway

Attachment	Date	Size
MotDismiss19-25Reply.pdf	06/28/09 1:05 pm	364.62 KB

ORDER on MOTION to Dismiss Counts 19-25

I'm catching up with a bit of backlog here. Soloway has pled guilty to three counts (the plea agreement will be posted in a little while). In some press accounts, Soloway's attorney said that the lack of any identity theft counts in the plea agreement meant that the case "turned out to be very different from was originally charged."

I think that's just spin. The denial of this motion, in my opinion, pushed this plea.

===============================
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF WASHINGTON
AT SEATTLE

UNITED STATES OF AMERICA,
Plaintiff,

v.

ROBERT ALAN SOLOWAY,
Defendant.

ORDER DENYING DEFENDANT’S MOTION TO DISMISS COUNTS 19 THROUGH 25 OF THE SECOND SUPERSEDING INDICTMENT

This matter comes before the Court on Defendant’s motion to dismiss counts 19 through 25 of the second superseding indictment. (Dkt. No. 62.) Having reviewed the motion, the Government’s response (Dkt. No. 64), Defendant’s reply (Dkt. No. 66), and all materials submitted in support thereof, the Court DENIES the motion for the reasons set forth below.

Background

On January 3, 2008, the government entered a second superseding indictment against Mr. Soloway that includes charges of mail fraud, wire fraud, fraud in connection with electronic mail, aggravated identity theft, willful failure to file income tax, and money laundering. Mr. Soloway brings this motion to dismiss the seven counts of aggravated identity theft under Fed. R. Crim. Pro. 12(b)(2). Rule 12(b)(2) states that “[a] party may raise by pretrial motion any defense, objection, or request that the court can determine without a trial of the general issue.”

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Analysis

A district court may dismiss an indictment on a pretrial motion for insufficient evidence only when undisputed facts show that the Government cannot support the indictment. See U. S. v. Phillips, 367 F.3d 846, 855 fn.25 (9th Cir. 2004) (citing U. S. v. Hall, 20 F.3d 1084, 1087 (10th Cir. 1994)). Such dismissal “is equivalent to a determination that as a matter of law, the government is incapable of proving its case beyond a reasonable doubt.” U. S. v. Weiss, 469 F. Supp. 2d 941, 948-949 (D. Colo. 2007) (internal citation and quotation marks omitted). Pre-trial dismissal is not warranted if the Government could conceivably produce evidence at trial supporting the indictment.

Mr. Soloway first argues that the conduct alleged does not constitute aggravated identity theft under 18 U.S.C. §1028A. However, the Government claims that it will present evidence showing that Mr. Soloway sent bulk emails to third parties that contained another person’s email address in the “From” header. Mr. Soloway contests the existence of such evidence. Because the relevant facts are disputed, the issue of whether Mr. Soloway’s alleged conduct constitutes aggravated identity theft cannot be decided as a matter of law. Further, the Court declines to offer an advisory ruling on whether the act of substituting a recipient’s email address for the sender’s address in the header of an email constitutes aggravated identity theft.

Mr. Soloway’s second argument, that the alleged conduct supporting the counts of aggravated identity theft is “already covered” by the count of fraud in connection with electronic mail, is imprecise and disregards established law. The same conduct can be used to support multiple offenses as long as each offense requires proof of a fact that the other does not. Blockburger v. United States, 284 U.S. 299, 303 (1932). The crimes of aggravated identity theft and fraud in connection with electronic mail, defined in 18 U.S.C. §1028A(a)(1) and 18 U.S.C. §1037(a)(3), are not multiplicitous because each requires that the Government prove distinct elements.

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Conclusion

The Court DENIES Mr. Soloway’s motion to dismiss counts 19 through 25 on the ground of insufficient evidence because the parties are in dispute about the facts to be presented at trial. The Court also DENIES Mr. Soloway’s motion to dismiss counts 19 through 25 on the ground that those counts are multiplicitous with count 18 because each offense requires proof of distinct elements.

The clerk is directed to send copies of this order to all counsel of record.

Date: March 6, 2008

/s/
Marsha J. Pechman
U.S. District Judge

Attachment	Date	Size
MotDismiss19-25Order.pdf	03/20/08 8:44 am	19.51 KB