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lf or his
family if I repeat the long-established fact that his name
Craig Neidorf (pronounced NYE-dorf).
Neidorf's jury trial took place in the United States
District Court, Northern District of Illinois, Eastern
Division, with the Honorable Nicholas J. Bua presiding.
The United States of America was the plaintiff, the
defendant Mr. Neidorf. The defendant's attorney was
Sheldon T. Zenner of the Chicago firm of Katten, Muchin
The prosecution was led by the stalwarts of the
Chicago Computer Fraud and Abuse Task Force: William
J. Cook, Colleen D. Coughlin, and David A. Glockner, all
Assistant United States Attorneys. The Secret Service
Case Agent was Timothy M. Foley.
It will be recalled that Neidorf was the co-editor of
underground hacker "magazine" called *Phrack*.
*Phrack* was an entirely electronic publication,
distributed through bulletin boards and over electronic
networks. It was amateur publication given away for free.
Neidorf had never made any money for his work in
*Phrack.* Neither had his unindicted co-editor "Taran
King" or any of the numerous *Phrack* contributors.
The Chicago Computer Fraud and Abuse Task Force,
however, had decided to prosecute Neidorf as a fraudster.
To formally admit that *Phrack* was a "magazine" and
Neidorf a "publisher" was to open a prosecutorial
Pandora's Box of First Amendment issues. To do this was
to play into the hands of Zenner and his EFF advisers,
which now included a phalanx of prominent New York civil
rights lawyers as well as the formidable legal staff of
Katten, Muchin and Zavis. Instead, the prosecution relied
heavily on the issue of access device fraud: Section 1029
Title 18, the section from which the Secret Service drew its
most direct jurisdiction over computer crime.
Neidorf's alleged crimes centered around the E911
Document. He was accused of having entered into a
fraudulent scheme with the Prophet, who, it will be
recalled, was the Atlanta LoD member who had illicitly
copied the E911 Document from the BellSouth AIMSX
The Prophet himself was also a co-defendant in the
Neidorf case, part-and-parcel of the alleged "fraud
scheme" to "steal" BellSouth's E911 Document (and to
pass the Document across state lines, which helped
establish the Neidorf trial as a federal case). The
in the spirit of full co-operation, had agreed to testify
In fact, all three of the Atlanta crew stood ready to
testify against Neidorf. Their own federal prosecutors in
Atlanta had charged the Atlanta Three with: (a)
conspiracy, (b) computer fraud, (c) wire fraud, (d) access
device fraud, and (e) interstate transportation of stolen
property (Title 18, Sections 371, 1030, 1343, 1029, and
Faced with this blizzard of trouble, Prophet and
Leftist had ducked any public trial and had pled guilty to
reduced charges -- one conspiracy count apiece. Urvile
had pled guilty to that odd bit of Section 1029 which makes
it illegal to possess "fifteen or more" illegal access
(in his case, computer passwords). And their sentences
were scheduled for September 14, 1990 -- well after the
Neidorf trial. As witnesses, they could presumably be
relied upon to behave.
Neidorf, however, was pleading innocent. Most
everyone else caught up in the crackdown had
"cooperated fully" and pled guilty in hope of reduced
sentences. (Steve Jackson was a notable exception, of
course, and had strongly protested his innocence from the
very beginning. But Steve Jackson could not get a day in
court -- Steve Jackson had never been charged with any
crime in the first place.)
Neidorf had been urged to plead guilty. But Neidorf
was a political science major and was disinclined to go to
jail for "fraud" when he had not made any money, had not
broken into any computer, and had been publishing a
magazine that he considered protected under the First
Neidorf's trial was the *only* legal action of the
entire Crackdown that actually involved bringing the
issues at hand out for a public test in front of a jury of
Neidorf, too, had cooperated with investigators. He
had voluntarily handed over much of the evidence that
had led to his own indictment. He had already admitted
in writing that he knew that the E911 Document had been
stolen before he had "published" it in *Phrack* -- or, from
the prosecution's point of view, illegally transported
property by wire in something purporting to be a
But even if the "publication" of the E911 Document
was not held to be a crime, that wouldn't let Neidorf off
the hook. Neidorf had still received the E911 Document
when Prophet had transferred it to him from ъich
Andrews' Jolnet node. On that occasion, it certainly
hadn't been "published" -- it was hacker booty, pure and
simple, transported across state lines.
The Chicago Task Force led a Chicago grand jury to
indict Neidorf on a set of charges that could have put him
in jail for thirty years. When some of these charges were
successfully challenged before Neidorf actually went to
trial, the Chicago Task Force rearranged his indictment so
that he faced a possible jail term of over sixty years! As
first offender, it was very unlikely that Neidorf would in
fact receive a sentence so drastic; but the Chicago Task
Force clearly intended to see Neidorf put in prison, and
his conspiratorial "magazine" put permanently out of
commission. This was a federal case, and Neidorf was
charged with the fraudulent theft of property worth almost
eighty thousand dollars.
William Cook was a strong believer in high-profile
prosecutions with symbolic overtones. He often published
articles on his work in the security trade press, arguing
that "a clear message had to be sent to the public at large
and the computer community in particular that
unauthorized attacks on computers and the theft of
computerized information would not be tolerated by the
The issues were complex, the prosecution's tactics
somewhat unorthodox, but the Chicago Task Force had
proved sure-footed to date. "Shadowhawk" had been
bagged on the wing in 1989 by the Task Force, and
sentenced to nine months in prison, and a $10,000 fine.
The Shadowhawk case involved charges under Section
1030, the "federal interest computer" section.
Shadowhawk had not in fact been a devotee of
"federal-interest" computers per se. On the contrary,
Shadowhawk, who owned an AT&T home computer,
seemed to cherish a special aggression toward AT&T. He
had bragged on the underground boards "Phreak Klass
2600" and "Dr. ъipco" of his skills at raiding AT&T, and of
his intention to crash AT&T's national phone system.
Shadowhawk's brags were noticed by Henry Kluepfel of
Bellcore Security, scourge of the outlaw boards, whose
relations with the Chicago Task Force were long and
The Task Force successfully established that Section
1030 applied to the teenage Shadowhawk, despite the
objections of his defense attorney. Shadowhawk had
entered a computer "owned" by U.S. Missile Command
and merely "managed" by AT&T. He had also entered an
AT&T computer located at ъobbins Air Force Base in
Georgia. Attacking AT&T was of "federal interest"
whether Shadowhawk had intended it or not.
The Task Force also convinced the court that a piece
of AT&T software that Shadowhawk had illicitly copied
from Bell Labs, the "Artificial Intelligence C5 Expert
System," was worth a cool one million dollars.
Shadowhawk's attorney had argued that Shadowhawk had
not sold the program and had made no profit from the
illicit copying. And in point of fact, the C5 Expert System
was experimental software, and had no established
market value because it had never been on the market in
the first place. AT&T's own assessment of a "one million
dollar" figure for its own intangible property was accepted
without challenge by the court, however. And the court
concurred with the government prosecutors that
Shadowhawk showed clear "intent to defraud" whether
he'd gotten any money or not. Shadowhawk went to jail.
The Task Force's other best-known triumph had been
the conviction and jailing of "Kyrie." Kyrie, a true
of the digital criminal underground, was a 36-year-old
Canadian woman, convicted and jailed for
telecommunications fraud in Canada. After her release
from prison, she had fled the wrath of Canada Bell and the
ъoyal Canadian Mounted Police, and eventually settled,
very unwisely, in Chicago.
"Kyrie," who also called herself "Long Distance
Information," specialized in voice-mail abuse. She
assembled large numbers of hot long-distance codes, then
read them aloud into a series of corporate voice-mail
systems. Kyrie and her friends were electronic squatters
in corporate voice-mail systems, using them much as if
they were pirate bulletin boards, then moving on when
their vocal chatter clogged the system and the owners
necessarily wised up. Kyrie's camp followers were a loose
tribe of some hundred and fifty phone-phreaks, who
followed her trail of piracy from machine to machine,
ardently begging for her services and expertise.
Kyrie's disciples passed her stolen credit-card
numbers, in exchange for her stolen "long distance
information." Some of Kyrie's clients paid her off in cash,
by scamming credit-card cash advances from Western
Kyrie travelled incessantly, mostly through airline
tickets and hotel rooms that she scammed through stolen
credit cards. Tiring of this, she found refuge with a
female phone phreak in Chicago. Kyrie's hostess, like a
surprising number of phone phreaks, was blind. She was
also physically disabled. Kyrie allegedly made the best of
her new situation by applying for, and receiving, state
welfare funds under a false identity as a qualified
caretaker for the handicapped.
Sadly, Kyrie's two children by a former marriage had
also vanished underground with her; these pre-teen digital
refugees had no legal American identity, and had never
spent a day in school.
Kyrie was addicted to technical mastery and
enthralled by her own cleverness and the ardent worship
of her teenage followers. This foolishly led her to phone
up Gail Thackeray in Arizona, to boast, brag, strut, and
offer to play informant. Thackeray, however, had already
learned far more than enough about Kyrie, whom she
roundly despised as an adult criminal corrupting minors, a
"female Fagin." Thackeray passed her tapes of Kyrie's
boasts to the Secret Service.
Kyrie was raided and arrested in Chicago in May
1989. She confessed at great length and pled guilty.
In August 1990, Cook and his Task Force colleague
Colleen Coughlin sent Kyrie to jail for 27 months, for
computer and telecommunications fraud. This was a
markedly severe sentence by the usual wrist-slapping
standards of "hacker" busts. Seven of Kyrie's foremost
teenage disciples were also indicted and convicted. The
Kyrie "high-tech street gang," as Cook described it, had
been crushed. Cook and his colleagues had been the first
ever to put someone in prison for voice-mail abuse. Their
pioneering efforts had won them attention and kudos.
In his article on Kyrie, Cook drove the message home
to the readers of *Security Management* magazine, a
trade journal for corporate security professionals. The
case, Cook said, and Kyrie's stiff sentence, "reflect a new
reality for hackers and computer crime victims in the
'90s.... Individuals and corporations who report computer
and telecommunications crimes can now expect that their
cooperation with federal law enforcement will result in
meaningful punishment. Companies and the public at
large must report computer-enhanced crimes if they want
prosecutors and the course to protect their rights to the
tangible and intangible property developed and stored on
Cook had made it his business to construct this "new
reality for hackers." He'd also made it his business to
police corporate property rights to the intangible.
Had the Electronic Frontier Foundation been a
"hacker defense fund" as that term was generally
understood, they presumably would have stood up for
Kyrie. Her 1990 sentence did indeed send a "message"
that federal heat was coming down on "hackers." But
Kyrie found no defenders at EFF, or anywhere else, for
that matter. EFF was not a bail-out fund for electronic
The Neidorf case paralleled the Shadowhawk case in
certain ways. The victim once again was allowed to set the
value of the "stolen" property. Once again Kluepfel was
both investigator and technical advisor. Once again no
money had changed hands, but the "intent to defraud"
The prosecution's case showed signs of weakness
early on. The Task Force had originally hoped to prove
Neidorf the center of a nationwide Legion of Doom
criminal conspiracy. The *Phrack* editors threw physical
get-togethers every summer, which attracted hackers
from across the country; generally two dozen or so of the
magazine's favorite contributors and readers. (Such
conventions were common in the hacker community; 2600
Magazine, for instance, held public meetings of hackers in
New York, every month.) LoD heavy-dudes were always a
strong presence at these *Phrack*-sponsored
In July 1988, an Arizona hacker named "Dictator"
attended Summercon in Neidorf's home town of St. Louis.
Dictator was one of Gail Thackeray's underground
informants; Dictator's underground board in Phoenix was
a sting operation for the Secret Service. Dictator brought
an undercover crew of Secret Service agents to
Summercon. The agents bored spyholes through the wall
of Dictator's hotel room in St Louis, and videotaped the
frolicking hackers through a one-way mirror. As it
happened, however, nothing illegal had occurred on
videotape, other than the guzzling of beer by a couple of
minors. Summercons were social events, not sinister
cabals. The tapes showed fifteen hours of raucous
laughter, pizza-gobbling, in-jokes and back-slapping.
Neidorf's lawyer, Sheldon Zenner, saw the Secret
Service tapes before the trial. Zenner was shocked by the
complete harmlessness of this meeting, which Cook had
earlier characterized as a sinister interstate conspiracy to
commit fraud. Zenner wanted to show the Summercon
tapes to the jury. It took protracted maneuverings by the
Task Force to keep the tapes from the jury as "irrelevant."
The E911 Document was also proving a weak reed. It
had originally been valued at $79,449. Unlike
Shadowhawk's arcane Artificial Intelligence booty, the
E911 Document was not software -- it was written in
English. Computer-knowledgeable people found this
value -- for a twelve-page bureaucratic document --
frankly incredible. In his "Crime and Puzzlement"
manifesto for EFF, Barlow commented: "We will probably
never know how this figure was reached or by whom,
though I like to imagine an appraisal team consisting of
Franz Kafka, Joseph Heller, and Thomas Pynchon."
As it happened, Barlow was unduly pessimistic. The
EFF did, in fact, eventually discover exactly how this
was reached, and by whom -- but only in 1991, long after
the Neidorf trial was over.
Kim Megahee, a Southern Bell security manager,
had arrived at the document's value by simply adding up
the "costs associated with the production" of the E911
Document. Those "costs" were as follows:
1. A technical writer had been hired to research and
write the E911 Document. 200 hours of work, at $35 an
hour, cost : $7,000. A Project Manager had overseen the
technical writer. 200 hours, at $31 an hour, made: $6,200.
2. A week of typing had cost $721 dollars. A week of
formatting had cost $721. A week of graphics formatting
had cost $742.
3. Two days of editing cost $367.
` 4. A box of order labels cost five dollars.
5. Preparing a purchase order for the Document,
including typing and the obtaining of an authorizing
signature from within the BellSouth bureaucracy, cost
6. Printing cost $313. Mailing the Document to fifty
people took fifty hours by a clerk, and cost $858.
7. Placing the Document in an index took two clerks
an hour each, totalling $43.
Bureaucratic overhead alone, therefore, was alleged
to have cost a whopping $17,099. According to Mr.
Megahee, the typing of a twelve-page document had
taken a full week. Writing it had taken five weeks,
including an overseer who apparently did nothing else but
watch the author for five weeks. Editing twelve pages had
taken two days. Printing and mailing an electronic
document (which was already available on the Southern
Bell Data Network to any telco employee who needed it),
had cost over a thousand dollars.
But this was just the beginning. There were also the
*hardware expenses.* Eight hundred fifty dollars for a
VT220 computer monitor. *Thirty-one thousand dollars*
for a sophisticated VAXstation II computer. Six thousand
dollars for a computer printer. *Twenty-two thousand
dollars* for a copy of "Interleaf" software. Two thousand
five hundred dollars for VMS software. All this to create
the twelve-page Document.
Plus ten percent of the cost of the software and the
hardware, for maintenance. (Actually, the ten percent
maintenance costs, though mentioned, had been left off
the final $79,449 total, apparently through a merciful
Mr. Megahee's letter had been mailed directly to
William Cook himself, at the office of the Chicago federal
attorneys. The United States Government accepted these
telco figures without question.
As incredulity mounted, the value of the E911
Document was officially revised downward. This time,
ъobert Kibler of BellSouth Security estimated the value of
the twelve pages as a mere $24,639.05 -- based,
purportedly, on "ъ&D costs." But this specific estimate,
right down to the nickel, did not move the skeptics at all;
fact it provoked open scorn and a torrent of sarcasm.
The financial issues concerning theft of proprietary
information have always been peculiar. It could be
argued that BellSouth had not "lost" its E911 Document at
all in the first place, and therefore had not suffered any
monetary damage from this "theft." And Sheldon Zenner
did in fact argue this at Neidorf's trial -- that Prophet's
had not been "theft," but was better understood as illicit
The money, however, was not central to anyone's true
purposes in this trial. It was not Cook's strategy to
convince the jury that the E911 Document was a major act
of theft and should be punished for that reason alone.
His strategy was to argue that the E911 Document was
*dangerous.* It was his intention to establish that the
E911 Document was "a road-map" to the Enhanced 911
System. Neidorf had deliberately and recklessly
distributed a dangerous weapon. Neidorf and the
Prophet did not care (or perhaps even gloated at the
sinister idea) that the E911 Document could be used by
hackers to disrupt 911 service, "a life line for every
certainly in the Southern Bell region of the United States,
and indeed, in many communities throughout the United
States," in Cook's own words. Neidorf had put people's
lives in danger.
In pre-trial maneuverings, Cook had established that
the E911 Doc