In a decision described by Judge William Fletcher as “easy,” the 9th Circuit enforced a DEA administrative subpoena against Golden Valley Electric Association in Alaska for a broad array of information about three of its customers. At the very least, Golden Valley’s refusal to simply hand over its records without a fight warrants appreciation and admiration, despite its having taken the loss.
While most companies are not merely happy to turn over anything requested by the government, usually sending a box of donuts along with personal information just to remain on its good side, GVEA decided that it would rather protect the privacy of its members than become a cog in the government’s wheel. The request was, to be mild, intrusive:
As part of its investigation, the DEA served an administrative subpoena on Golden Valley pursuant to 21 U.S.C. § 876(a). The subpoena ordered Golden Valley to provide company records pertaining to electricity consumption at three specified customer addresses. The records subpoenaed were:Golden Valley did not immediately comply with the subpoena.customer information including full name, address, telephone number, and any account information for customer; method of payment (credit card, debit card, cash, check) with card number and account information; to include power consumption records and date(s) service was initiated and terminated for the period 10-01-2009 through 12-14-2010, if applicable[.]
The Comprehensive Drug Abuse and Prevention Act of 1970 was intended to “strengthen law enforcement tools against the traffic of illicit drugs.” No law since the ratification of the Bill of Rights to the Constitution was intended to strengthen tools to protect our privacy from the government.
The purpose of the subpoena was to ascertain whether the three locations used significantly greater amounts of electricity than the norm. This is one indicia of a property being used as a “grow house,” due to the intense lighting needed to grow marijuana. As for the rest of the information sought, identifying the individual(s) in control of the premises and their financial information, it was the sort of detail that would be useful if the premises were being used illegally. If not, it was just personal, private financial information of innocent people in the hands of the government. What could go wrong?
GVEA questioned the relevance of the information sought by the government, contending that fluctuations in electric use were common in Alaska. The court dismissed the argument.
The information subpoenaed does not need to be relevant to a crime; in fact, it may be used to dissipate any suspicion of a crime. The information subpoenaed need only be relevant to an agency investigation.
This rationale is rather extraordinary, slipping in the backdoor argument that the evidence subpoenaed could not merely show guilt, but could exculpate the targets as well. The problem with such a theory is that it could be used affirmatively by the government as a basis for a subpoena.
Company: Why are you subpoenaing Joe Smith’s records?
DEA Agent: We suspect that Smith has not committed a crime, and are trying to prove it.
Company: Well then, here you go. After all, it’s relevant to dissipating suspicion of a crime.
While it’s doubtful that Judge Fletcher had this in mind when he wrote those words, the law of unintended consequences remains in full force and effect.
Moreover, GVEA contended that the information of its customers was private, and that the government should be held to the standard of the 4th Amendment, and require a warrant, before the company was compelled to hand over the information. The Circuit wasn’t impressed with that argument either.
The Supreme Court has refused to require that an agency have probable cause to justify issuance of a subpoena. See United States v. Powell, 379 U.S. 48, 57 (1964) (citing the “general rejection of probable cause requirements in [administrative subpoenas] involving other agencies”); Okla. Press, 327 U.S. at 215-16 (rejecting probable cause requirement in agency subpoena context).
While this is nothing new, it bears noting that the black letter law from 1964 is more than adequate to dispense with the need for administrative subpoenas to meet probable cause. Why is that, you ask? Don’t worry your pretty head over it, the court responds. After all, if a party refuses to comply, the agency will have to go to court to enforce it’s subpoena, and a court will then decide it’s worthiness. Just like this court did.
The court then rejected GVEA’s contention that it had a duty to its customers to keep their personal information private.
Golden Valley also relies on a company policy of protecting the privacy of its members. Depending on the circumstances or the type of information, a company’s guarantee to its customers that it will safeguard the privacy of their records might suffice to justify resisting an administrative subpoena. However, Golden Valley has not shown the existence of any agreement with its customers to keep their usage and payment records confidential. Further, the Court in Miller carefully explained that the nature of the subpoenaed bank records gave the bank’s customers little reason to expect that they would be kept confidential from the government. The Court wrote:
Even if we direct our attention to the original checks and deposit slips, rather than to the microfilm copies actually received and obtained by means of the subpoena, we perceive no legitimate “expectation of privacy” in their contents. The checks are not confidential communications but negotiable instruments to be used in commercial transactions. All of the documents obtained, including financial statements and deposit slips, contain only information voluntarily conveyed to the banks and exposed to their employees in the ordinary course of business.
While the court offers some hope that a company can, with an unspecified “guarantee,” create a contractual duty with its customers to keep their information private from the government, that hope is pretty well dashed by the quote, to the effect that bank checks and deposit slips, perhaps the information most dear and private to citizens, isn’t confidential because we “voluntarily convey” that information to banks and their employees are “exposed” to it.
While this may be a fine argument for keeping your savings under your mattress to protect your privacy, other laws requiring disclosure of currency transactions and prohibiting its use make that problematic as well.
Sadly, the 9th Circuit’s decision is sound in all respects on existing law, meaning that every time some company with which you do business promises that it will protect your privacy, you can bet that a court will have a good chuckle when asked to enforce a government subpoena. At least GVEA tried to fight it. Not too many would bother.
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If it weren’t Alaska, I’d say buy solar panels and go off-grid if you want your power usage to remain private.
Same issue with “smart grids” plus the added potential to cut off your power for political reasons.
If only you could power up with those gamma rays they’re shooting at you.
This is an excellent example of how the law slowly (and shamelessly) morphs over time to allow the government the “necessary” leeway to investigate criminal activity in areas where effective enforcement essentially requires that the police be allowed to engage in practices which, by any other measure would be considered extremely invasive and invoke “legitimate privacy interests.” The legal precedents on display in the 9th circuit are the reason why many academics now allege that a virtual “drug exception” exists in the Fourth Amendment. Warrant application processes can now literally be rigged so that Leon’s good faith exception applies regardless of whether the warrant was properly executed. And Conservative Justices from White to Roberts, terrified as they are of a “Judicial Tyranny,” have seen fit to simply defer to the judgment of police rather than actually defend peoples’ constitutional rights. They fear letting the criminal go free because the constable has blundered, yet they’ve set up a legal regime in which the constable may now blunder with impunity. It’s as if Justice Day’s warning in Weeks v. United States means nothing:
“If letters and private documents can…be [unlawfully] seized and held and used in evidence against a citizen accused of an offense, the protection of the 4th Amendment, declaring his right to be secure against such searches and seizures, is of no value, and, so far as those thus placed are concerned, might as well be stricken from the Constitution.” — 232 U.S. 383, 393 (1914).
So much for all that.
The core exception here, the court calling it “business records” but more properly the third party doctrine, is one of the most dangerous and least recognized to ordinary people. As society moves deeper into the digital age, the exception will have completely swallowed the rule.
What used to be referred to cynically as the drug exception, that courts would find a way to permit a search of anything relating to drugs, is now a fond memory, as the third party doctrine applies to everything. Here, it’s pot, but it could have been any crime being investigated and the court would have sanctioned the warrantless disclsoure. This is the state of the law.
I’ll tell you what: When the Secret Service allows the White House and Camp David on a “Smart Grid”, when Al Gore put his mansion with the $3,600/month power bill on a “Smart Grid”, I’ll consider it.
In the meantime, I won’t put myself at the mercy of some hacker from Greenpeace, Earth First!, Earth Liberation Front, Sierra Club or any of the other environmental terrorist organizations (including EPA). Swiss cheese has fewer holes than the security on a Smart Grid and I want no part of it.