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Transcript of Craig Neidorf Trial


(The following transcript of Craig Neidorf's trial was provided

by his legal counsel, to whom we are indebted. The page numbers

correspond to transcript pagination. The document was retyped by CuD,

and cross-checked against the original. A spell checker removed

spelling errors, and if any of these errors appeared in the original,

they too were removed.)



********************************************************************



IN THE UNITED STATES DISTRICT COURT



NORTHERN DISTRICT OF ILLINOIS



EASTERN DIVISION



THE UNITED STATES OF AMERICA,      .

Plaintiff,      .       90 CR 70

.

.

v.                     .       Chicago, Illinois

.

CRAIG NEIDORF,                     .       Tuesday,

Defendant.      .       July 24, 1990

.

.       10:10 a.m.

.

. . . . . . . . . . . . . . . . . ..



VOLUME ONE

TRANSCRIPT OF JURY TRIAL PROCEEDINGS

BEFORE THE HONORABLE NICHOLAS J. BUA

AND A JURY



PRESENT:



For the Government:        THE HONORABLE IRA H. RAPHAELSON,

United States Attorney, by

WILLIAM J. COOK

COLLEEN D. COUGHLIN

DAVID A. GLOCKNER

Assistant United States Attorneys

219 South Dearborn Street

Fifteenth Floor

Chicago, Illinois 60604



For Defendant:             SHELDON T. ZENNER

Katten, Muchin and Zavis

525 West Monroe Street

Suite 1600

Chicago, Illinois 60606



Case Agent:                TIMOTHY M. FOLEY

Special Agent

United States Secret Service



Court Reporter:            Agnes M. Thorne

Official Court Reporter



- 2 -



(Twelve jurors and four alternate jurors sworn to try

issues.)

(Following proceedings transpired out of the presence of the

jury:)



MR. COOK: Judge, we have two short issues to bring up. The

government, obviously, understands the court's rulings on the First

Amendment mistake of law. We are in a bit of a quandary in terms of

the best way to argue that or front that with the jury during our

openings. Does the court anticipate giving an instruction as to the

law of mistake of law with respect to this either before Mr. Zenner

talks or at the conclusion of the case?



THE COURT: At the conclusion of the case in written instructions

to the jury.



MR. COOK: And that would be along the lines that it is not a

defense to this violation mistake of law.



THE COURT: That we will decide at the conference on jury

instructions.



MR. COOK: All right.



THE COURT: Mistake of law is no defense. I think we can agree

to that.



MR. ZENNER: No.



THE COURT: We can't?



MR. ZENNER: Wait. We agreed that the First Amendment is no

defense. Mistake of law is a defense to a specific intent crime.



MR. COOK: That's enough. That's enough for me to make my



- 3 -



Cook -- opening statement



opening.



THE COURT: Is that enough?



Mr. Cook: Yes.



THE COURT: Okay. What else?



MR. COOK: Also, Mr. Zenner is indicating that he wants to

argue about the videotapes or make some presentation about the

videotapes in his opening remarks. Those are irrelevant.



THE COURT: What is the nature of those videotapes?



MR. ZENNER: It is very simple. On one of the dates charged

in the indictment, the exact date, in fact, the exact date charged

in the indictment in Count Two, the date the scheme was supposed to

start, Mr. Neidorf was surreptitiously videotaped by the Secret

Service at SummerCon '88, the hacker convention.



THE COURT: Okay, now I recall.



MR. ZENNER: That is the subject of that. The fact that he is on

videotape for 15 hours on the date he is supposed to have committed

the crime in the midst of a supposed conspiracy with some

of the other people who are on videotape I expect to mention,

albeit very briefly, probably ten seconds worth in an opening,

well, maybe thirty seconds worth in an opening, that he was

videotaped on that day, a date charged in the indictment, and that

the worst thing they saw him do or talk about when he was with these

people he is supposedly conspiring with is to drink a beer, order

a pizza. I mean, that's it. They have a the videotape in the middle

of this scheme with his coschemers.



- 4 -



Cook -- opening statement



THE COURT: And what's the problem with that?



MR. GLOCKNER: Judge, we went through all this before on the

discovery motions. And your Honor agreed with the government that

(a) the fact that the defendant is videotaped not committing a

crime is not relevant to whether or not on some other occasion

he did.



Second, as we argued in the earlier filings with your Honor,

he is not charged with holding SummerCon, with participating

in SummerCon...



THE COURT: You will object to the entry in evidence of that

videotape?



MR. GLOCKNER: Absolutely.



THE COURT: The objection will be sustained.



MR. GLOCKNER: Thank you.



THE COURT: What else?



MR. COOK: Nothing else, Judge.



MR. ZENNER: With respect to the videotape, I accept the court's

ruling that the videotape will not be introduced, but I can

certainly refer to the fact that he was videotaped, and I can ask the

agent that, and I intend to ask the agent who investigated this case:

"On a date charged in the indictment..." Mr. Cook is going to show

that. He is going to say, "On July 22, 1988, my client committed

a wire fraud". He's going to tell them to convict him of that.

On that date, he's on videotape for fifteen hours with the Secret

Service looking at him, and he doesn't do anything of the sort.

He's meeting with his coschemers...he's meeting with his

coconspirators.



- 5 -



Cook -- opening statement



THE COURT: And you will seek to introduce the videotape to

show that he couldn't have committed the crime on that date?



MR. ZENNER: All I want to be able to do is to cross-examine

Agent Foley on that.



THE COURT: Well, you might be able to cross the agent

depending on what his direct testimony is. Those issues...



MR. ZENNER: It is a date charged in the scheme. I have a hard

time imagining how I can't cross.



THE COURT: Mr. Zenner, you can make the opening statements, and

if there is an objection, I will sustain it. Okay.



MR. ZENNER: All right.



THE COURT: What else?



MR. COOK: Nothing.



THE COURT: Bring in the jury please.



(Jury present at 10:20 a.m.)



THE COURT: Good morning ladies and gentlemen.



JURORS: Good morning.



THE COURT: Please be seated.



Mr. Cook, is the government prepared to make its opening

statement?



MR. COOK: Yes, Judge.



THE COURT: Very well.



MR. COOK: Thank you.



_OPENING STATEMENT ON BEHALF OF THE GOVERNMENT_



MR. COOK: Good Morning, ladies and gentlemen.



- 6 -



Cook -- opening statement



JURORS: Good morning.



MR. COOK: My name is Bill Cook. I'm an Assistant United States

Attorney. I am going to be substantially aided in this prosecution

by Colleen Coughlin, who is an Assistant United States Attorney, and

Dave Glockner, who is also an Assistant United States Attorney. We

will be having Special Agent Tim Foley of the United States Secret

Service working with us. He is sitting at the trial table with us.

In 1876, the first telephone communication ever made was:

"Mr. Watson, come here, I want you".

That was also the very first emergency telephone call ever made.

Since that time, the telephone company has, obviously, sophisticated

their operation to a large degree so that where we stand today in

1990, we are the beneficiaries of what is known as the Enhanced 911

system. That system is a life line for every person certainly in the

Southern Bell region of the United States. It's taken for granted.

It is an extensively developed system. You're going to hear a great

deal of information about the development of that system and the

architecture that that system is based upon. It is built on

computers from bottom to top.

In 1988, a road map to that computer system, that life

line, was stolen from a computer in Atlanta, Georgia, by a man

by the name of Robert Riggs, who is a member of an organization

known as the Legion of Doom.

That document, with its proprietary markings, its warnings



- 7 -



Cook -- opening statement



on it, and the clear indications that it was the property of

BellSouth, was transferred electronically to Mr. Craig Neidorf, the

defendant here, seated right here.



Mr. Riggs is a hacker, a person that breaks into

computers. He answers to no one but his own ability to get into

those computers.



We anticipate that the evidence will show that in February

of 1989, Mr. Neidorf published that extensive road map to the

life line of the entire hacker community so far as he was able to

determine it and define it.



In many respects, I submit to you that this is not going

to be a, "Whodunit", or "What was done?".



There are two sets of violations charged in the indictment.

Very briefly, they are the interstate transportation of stolen

property and what is referred to in legal jargon as a wire fraud.



With respect to the interstate transportation of stolen

property, the evidence will show that Mr. Neidorf admitted to

receiving the stolen property, the stolen E911 text file from Robert

Riggs. He further admitted to Agent Foley that at the time he

received the document, he knew it was stolen.



With respect to the wire fraud the evidence will show

that the wire fraud was really an outgrowth of what you are going to

be hearing about and what will be described as the Phoenix Project,

an effort by Mr. Neidorf to consolidate a group of hackers.



The object of that wire fraud scheme was extensive, but it



- 8 -



Cook -- opening statement



included providing hackers with information about how to crack into

other people's computers, soliciting them to try to provide him

articles, articles for his publication PHRACK  newsletter which

he would then distribute to other hackers.



The evidence will also show that Mr. Riggs knew of the

hacker activities, the break-ins that were occurring as he would

follow along with their activities. In that respect, he was almost

a "hacker groupie", except a groupie that sought to be in control and

direct many of the operations. He received stolen property, property

stolen from computers, stored on computers.



Now, just one more set of observations about the indictment

and the format of the indictment, and then I'll move on to what

some of our more immediate concerns might be.



(Chart) Does everybody see that? One juror I know can't

see the bottom.



THE COURT: Can all the jurors now see that?



JURORS: Yes.



MR. Cook: Mr. Neidorf is charged in each count of the indictment,

except for the first count here. The coding here is this is the

second count of the indictment on down to Count Eleven. These

are the approximate dates that the violations or the activities

occured that are alleged in the indictment.



Specifically, in the second, the second count of the

indictment alleges that on July 22, 1988 as part of the wire fraud

scheme, Mr. Neidorf generated an issue of PHRACK World News in which



- 9 -



Cook -- opening statement



he announced the instigation of the Phoenix Project, the Phoenix

Project because it had been a year since the 1987, in their parlance,

collapse of the computer world by virtue of a series of law

enforcement raids. Mr. Neidorf announced here that he wanted the hacker

community to come together again to be more effective than ever.



The next activity is the third count of the indictment,

September 19, 1988, a wire fraud allegation again, E-mail,

electronic mail, generated from Mr. Neidorf to Mr. Riggs and

Mr. Scott O, a computer hacker.



This electronic mail, this electronic mail here also,

these are efforts by Mr. Neidorf reaching out to consolidate,

identify and pull together a group of hackers that he could be

working with for the publication of PHRACK, people that would supply

him with information and articles, and, as it turned out, people that

in fact, supplied him with stolen information, stolen from computers.



These allegations refer more directly to the interstate

transportation and movement and file transfers of the E911 text file.



Count Seven refers to the publication of a series of

computer articles that deal with how to break into a UNIX operating

system.



Counts Eight and Nine refer to the text file being sent from

Neidorf back to Riggs, from Neidorf in Missouri to Riggs who was

physically in Atlanta, but who used the bulletin board, computer

bulletin board, in Lockport, Illinois, sending it back for review and

to make sure that Neidorf had done an adequate job of concealing the



- 10 -



Cook -- opening statement



nature of the file fro the point of view not the contents so much

of the file, but concealing where Riggs had stolen it from to protect

Riggs, and, to a large degree, to protect himself so that it couldn't

be identified exactly where the document had been stolen from.



Finally, we have the publication of the E911 text file in

the PHRACK newsletter by Mr. Neidorf.



you will be seeing the indictment in the jury room as you

deliberate. This is just an overview to give you an overfocus of

where the allegations are going to fall and the types of information

that you are going to be hearing about.



Now, if I were you, if I were you, I would be sitting

there, as some of you may be, thinking to myself, "What have I gotten

myself in for? He's talking about computers. He's talking about

operating systems. Whooooaaaa!"



First of all, you don't need to be a computer user, or a

computer ace, to understand what this case is going to be about. It

really deals with, in its most essential form, stealing property and

transferring property, the interstate transportation of stolen

property. So it's a simple stealing and a simple fraudulent

taking, taking by deception. But it just involves some relatively

high-tech tools. Don't let the tools confuse you from the fact of the

taking and the bottom-line information. I'm telling you to relax

about the computer jargon.



There are several concepts that we're going to be talking

about here. What I'm going to give you is a kind of a lawyer's



- 11 -



Cook -- opening statement



description. That is supposed to let you know that it is far from

an expert's opinion on some of the things you're going to be hearing.



(Blackboard) Well, let's talk about some of the technology

that's involved, and see if we can't make ourselves more comfortable

with it.



I referred to the UNIX operating system. UNIX...U-N-I-X.

What is that? Well, computers speak a language. Computers speak

the language that the people that built the computer want them to

speak, or they speak the language that the people that run the

computer want it to speak. Sometimes computers can be set up so that

you can have them speak several different languages. UNIX is just a

language. It is just the language that the computer speaks. It

talks UNIX. Some of you talk about MS/DOS. It's a microsoft disk

operating system. Forget it! It's just the language that the

computer speaks.



(Blackboard) Now, this is a theft of information. You are

gong to be coming in contact with the concept that when you take

information from a computer, what you really do is you order the

computer to make a duplicate original o what its memory is or what

it contains with respect to that particular item. And when you are

asking the computer to send that information to you, you are doing a

file transfer. I'll get to that later. You are just telling the

computer to send it to you. What the computer sends to you is a

copy. It's an exact copy in every respect of the original

information on the computer.



- 12 -



Cook -- opening statement



So the value of the property comes from the fact that it

contains information. There is an expression that, "Information is

power". It is only power if it's communicated. That's where the

value of information comes from in our society.



Certain types of information are protected by companies.

They are reasonably protected by companies, especially when they

become sensitive. The E911 road map and the information about where

all the stops along the way are, that was a sensitive piece of

information. You're going to be hearing about the protections that

BellSouth put on that information, and the efforts that they made to

safeguard it. So when the information is stolen, what is stolen is a

copy of the information. You will be receiving further instructions

>from the judge on all that. So it is the information that is being

stolen.



(Blackboard) Now, the next concept--I talked about

protection--file transfers. File transfers. Here's a riddle for you:

"Why is a file transfer the same as a high

school graduation?"

Here's the answer. When you hear about this, think about a high

school graduation. They call your name from the audience. You come

up to the stirs, probably by the path that the nun ordered you to

take to get to the stage, and you had better not vary from the path.

You follow that route up to the stage, across the stage, and a file

transfer takes place at center stage in the auditorium. You reach

out, you shake hands with the principal, and with the other hand,

after you have shaken hands with the principal, you receive your



- 13 -



Cook -- opening statement



diploma, or you receive your information, you receive your file.

That's really all a file transfer is on a computer. You come up,

you are ordered, someone in a remote location, the principal in this

case, calls your name, you come up to the stage, you are the

computer on one side and he is the computer on the other side. You

shake hands. And in the computer world, all that means is that you

are able to communicate. It's actually called that. It is called a

"handshake relationship" with another computer. There are some other

words, like "protocol" and things like that, but, really, it is just

a handshake relationship with another computer.



After the handshake is there and the principal recognizes

you to be the problem kid that he's glad to get rid of--he didn't

like you--then he gives you the file. That's the file transfer. It

is no different transferring information from one computer to

another.



(Blackboard)  Computer network. Well, that is probably a

pretty easy concept to get hold of these days. It is really not much

different than with your televisions, especially if you have cable

television where you have some designated programming and it comes in

to your machine, your television in this case. Of course, the

difference is with cable television as opposed to a computer, with

the computer you are able to have more of an interchange with the TV

and what is going on with the program. So don't be concerned about

the network idea. Keep in mind the idea of a cable coming into your

computer as part of a centralized system. That is really all the



- 14 -



Cook -- opening statement



network is, a series of computers joined together.



In the case of BellSouth, you are going to see that that is

a very expensive computer network. In order to provide service to

their customers, they hang a lot of computers on that network,

computers that do different things, computers that keep track of

where the people that are using the phones are at, computers that

keep track of what telephone number goes with what address, computers

that keep track of the switches, the computer switches. Now,

that's another concept I'll talk about for a second.



(Chart) When people think of computer switches, they

are telephone switches. The concept of a lady at the switchboard

always comes to mind with a knob here that goes to a hole up here,

connecting one person to another person. Today, all of that is done

by high-speed computers, high-speed switches. They are electrical.

Because they are electrical, they are referred to as ESS. All this

means is an electronic switch. This is a computer. This computer

has the memory of how to get the numbers that are diales to the

phone that corresponds with those numbers. These computers also have

the information about how to get your call all the way across the

country, which route are we going to take to get there, which

road are we going to take.



The Enhanced 911 system was built on these computers.

Part of the reason was because of the high speed that is involved.

You can get the emergency call through faster if it goes like thing.



Now, the switches at various areas: Switch 1, Switch 2.



- 15 -



Cook -- opening statement



This is the first switch we produced, Switch 1. And the second

switch we produced, Switch 2. The fifth switch, Switch 5.



When they increased the capabilities of those switches, the

way they kept track of which switch they were talking about was to

label the switches: 1 or 1A, 2, 3, 4, 5, a fairly easy way to keep

track of the switch development. But the idea is that all electronic

switches operate essentially the same. So if you have the key to

get into this (indicating), you have the keys to get into them all.



The evidence will show that the hackers in the BellSouth

Region had the keys to get into them for a period of time.



Now, another question, a riddle:

"Why is computer security like a hotel?"

Mr. Garcia is going to be explaining that to you. Actually, it's a

lot like staying in a private hotel.



In the case of the computers at BellSouth, the computers

that drive the E911 system and support the phone company system

aren't known to the public. They are unpublished numbers. They

have their own network. The network, to be sure, has interlinks

with the private sector and can be reached by field people in the

telephone company, but it is really a closed system. It is designed

to be for protection.



So the hotel, the computer, is not known to the outside

world. Where the door is is not known to the outside world. When

you walk into the hotel, it's like if you try to walk into a hotel

in downtown Chicago. If you go to the desk and ask them, you know,



- 16 -



Cook -- opening statement



"I want to have Joe Jones' room".

Well, first of all you say:



"I want to see Mr. Jones."



"Well, we can't tell you if he's here."



"Well, if you tell me he's here, I want

to talk to him. I want to speak to him.

Give me his room number.



"Well, we're not going to give you

his room number. You are going to

have to call him on the house phone

and he'll have to verify that you're

somebody he knows."



So there are a series of checks that are set up inside the system.

But once you get inside the hotel, you can make contact with Jones.

And you will see, just as in real life, you have a number of people

at one hotel. You will have people going back and forth in the

hotel. And the person that runs the hotel assumes that they're all

there for good valid reasons. He's not going to do anything but

just a cursory check to make sure that everything is still in order.



It is really the same thing and the same principle is

involved if you are the system administrator on one of these

computers. You are in the position, in the shoes, of the hotel

operator, the guy that runs the hotel or the lady that runs the

hotel. You make sure that the right people show the right

credentials to get in and you exercise and upfront control. You also

exercise control over some of the common spaces. You make sure the

halls are lit. You make sure that things aren't being badly

destroyed to the best of your knowledge, although you don't know always



- 17 -



Cook -- opening statement



what's going on inside each of the rooms. It's very much the same.

So when you hear a person talk about running a system or computer

system security, think to the analogy of being a hotel operator.

We have a man, Mr. Garcia, from BellSouth, who will be testifying

to that and to that analogy, and I think you'll find it most

interesting.



(Blackboard) Text file. You will hear a lot about that.

That is probably a new term for you when you walked in: text file.

Just think of it as a book or a pamphlet stored on a computer.

That's it. That's the end of the mystery. A book or a pamphlet

stored on a computer. But because it is stored on a computer, it

can be copied if you can get into the computer. That's what

happened here.



(Blackboard) BBS. It means bulletin board system.

Sometimes it will have a "C" in front of it. All that means is

computer bulletin board system.



Now, here's my analogy to that. The computer bulletin

board system is a lot like a private high school where you have to

have permission to get in the front door. And the people that run

the high school have to give you permission to get into their

private location. But once you get into their private high school

and as you walk through, one of the first things that meets you as

you walk into the private high school is a bulletin board with

messages posted on it. And what you will also see along the sides of

it are going to be lockers, student lockers.



- 18 -



Cook -- opening statement



The principal bulletin board that you are going to be

hearing about during the course of this case is the Jolnet bulletin

board in Lockport, Illinois. The Jolnet bulletin board in Lockport,

Illinois, acted as a central clearing house for the information that

was being sent from Riggs in Atlanta to Neidorf in Missouri.



To carry the analogy a little further, the evidence is

going to show that Riggs used the bulletin board. He used it under

a false name which he used to disguise his real identity. He use it

under the name of Robert Johnson instead of Robert Riggs. He had

authorization to use the bulletin board section where you post

messages generally, and he also had a storage locker on the bulletin

board, on of those lockers along the wall in a high school, where he

thought he could safely store the text file, the E911 text file that

he had stolen. The evidence is going to be, though, that law

enforcement, Hank Kluepfel, found out about it. Mr. Kluepfel's

efforts to get into and to use Jolnet in that storage area will be

testified by Mr. Kluepfel. But the only thing we need to remember

here at this point is that the information was stored in Lockport,

Illinois. That is where the private high school is located. It was

stored in the locker of a private high school in Lockport.



But because computer technology is the way it is, Riggs is

able to transfer the file by E-mail or a file transfer down to

Neidorf in the computers at the University of Missouri. Again, this

analogy is not quite the same as the bulletin board, but the

University of Missouri has a capability there at the university to



- 19 -



Cook -- opening statement



allow students to have essentially a locker on their computer system

where Neidorf generated PHRACK Magazine from.



Just a final note of reassurance. As we go through the

evidence here, we are going to try to have the witnesses explain as

each step progresses what the technology is again. So hang in there

and listen with an open mind, as I know you will anyhow, listen to

the explanations of the technology.



(Chart) The evidence in this case is going to show that

the text file that was stolen here described in vivid detail each of

the locations along the E911 path to an emergency call. It's going

to show and it did show the central location and the central

significance of two places. When an emergency call is made in the

BellSouth area, BellSouth region--it is really the area

geographically that southerners describe as "Ol' Dixie"--when an

emergency call is made there, it goes to a thing called a PSAP, public

safety access point. The public safety access point is the one that

is in direct communication on secure lines with the fire, police, and

ambulance.



Under the old 911 system, the old emergency dialing

system, the call would come in, and they would have to trace it back

to the origin in many cases. You have a situation potentially where

someone would call, perhaps a child, and say, "My dad's hurt", and

before the operator could talk to the child, they hang up the phone.

The child, of course, figures, "Well, I called them. I told them y

dad was hurt. They'll e here". So it is, obviously, not that

easy. Under the old 911 system, a complicated tracing procedure had



- 20 -



Cook -- opening statement



to be established. They had to try to find out where the call had

come from, and it's all done in an emergency posture.



Now comes Enhanced 911. You will hear the lady that is

operating that system, or operated it for the balance of time

involved in this case. You will also hear from the man, Richard

Helms, that brought all the pieces together for the bellSouth

region, and put them in one central location so that all the phone

companies supporting the 911 system, the Enhanced 911 system, would

all be on board and be working with the same game plan, never thinking

that that game plan was going to be over over to hackers.



The Enhanced 911 gives you this capability within

three to five seconds of the time that the person picks up an

emergency call and that 911 is entered in, sometimes even before the

person at the public safety access point can pick up the phone. The

computers that drive the 911 system have done this: They have gone,

in this case, to the remote location in Sunrise, Florida, where the

back-up systems and the support systems for the control, the

maintenance and the operation of 911 are kept, and it has pulled up

all kinds of information about the person making the call.



When the person picks up the phone, it's connected wit police,

fire and ambulance. They have a TV monitor in front of them or a

computer monitory, if you will, which has all kinds of information.

It has the name of the caller or the people that the are known to be at the

calling address. It will have location information with respect to

where the closest department is, fire department, police department,



- 21 -



Cook -- opening statement



to that person. It will also contain information in their computer

storage banks about special problems that may exist. If it's a

business, if it's a business involving chemicals, the fact that those

chemicals are explosive will be reflected on that screen. If it is a

private home, if there is a handicapped person there, it will be

reflected on that screen. And it's all done within a matter of three

to five seconds. They have it captured there. That is what

Enhanced 911 is about. That's the system that Robert Riggs stole:

how that all works together, and how the computers at BellSouth

support that kind of capability, consistent with the telephone

company's long history, going back to that first phone call,

"watson, I want you", their tradition of providing emergency services

as the first priority of the phone system.



You will be hearing from essentially three groups of

witnesses. You will be hearing from people at bellSouth that will

tell you about the steps taken to protect the system. They will tell

you about the way the file was defined. They will also tell you that

at the same time that they were having these problems with 911 in

terms of the los of the file, at the same window, they recognized

that there was a larger problem throughout the network as a result

of hacker intrusions, that there were a series of bellSouth

computers along the network that had been attacked or were under

attack. Some of those computers included the ESS switches. They

recognized that the Enhanced 911 theft was a symptom of a disease.

The disease was the hackers into switches, and they took remedial



- 22 -



Cook -- opening statement



steps. They started out slowly to try to identify it, and then they

rapidly expanded, trying to solve the disease along with the problem

of E911. So you will hear from the BellSouth people.



You are also going to be hearing from three members of the

Legion of Doom, three hackers. You're going to be hearing from

Robert Riggs, Frank Darden and Adam Grant. They have hacker

handles. These hacker handles sometimes seem to get to be a little

on the colorful side, a little bit like "CB" handles.



You are going to be hearing the testimony of the hackers.

You're going to be hearing the testimony of Robert Riggs who will

testify that Mr. Neidorf had been after him to give him information

to put into PHRACK, this hacker newsletter. That when Riggs had

broken into the AIMS-X computer in BellSouth, he saw on that AIMX-X

computer at BellSouth the 911 text file. You're going to hear that

he contacted Neidorf in advance, that in that advance conversation or

communication, he advised Neidorf that he had the text file, he was

sending him the text file to put in PHRACK, that he had gotten it

>from an unauthorized account that he had on the BellSouth computer.

Essentially, what he told Neidorf is, "This is a stolen piece of

material you're getting".



He indicated to Neidorf and Neidorf agreed...first, he

agreed to take the stolen property, and he agreed to disguise the

identity of the stolen property to some degree so that it wouldn't

run off on Riggs. Riggs' name wouldn't appear on the file when it was

published in PHRACK. He would try to disguise some of the



- 23 -



Cook -- opening testimony



indiations that it was stolen from the BellSouth area...Neidorf

would. You will hear evidence that that is exactly what Neidorf did

to some degree or another.



You will hear evidence bout Neidorf seeing and noting the

proprietary warnings that made it clear that this was stolen

property belonging to BellSouth. He even made a joke of it. He put a

little, "Whoops"next to it when he sent it back to Riggs because he

didn't want BellSouth to know that he was inside their computers.



You're also going to hear evidence that Riggs was never

satisfied with the final result that Neidorf had because it always

contained too much information even for Riggs. But the E911 system,

the text file and the road map, was published by Neidorf all the

same.



You are going to be hearing from Agent Foley who will

testify that he talked to Neidorf about this at his fraternity house

at the University of Missouri. Neidorf said he has freedom of

expression. That was his response to Foley: Freedom of expression

to publish it in PHRACK.



The First Amendment can't be used as a defense to theft.

When you steal something, you can't claim that coming up the back

door, the First Amendment protected you.



You will be hearing from Agent Foley though that as part

of this discussion with Mr. Neidorf, Mr. Neidorf, in fact, admitted

that he knew the file was stolen, the text file was stolen, and he

published it in PHRACK.



- 24 -



Cook -- opening statement



He also turns over to Foley a hacker tutorial, a hacker

lesson to other hackers on how to break into the ESS switches. He

turns that over.



The evidence will also indicate that in addition to that

stolen information was information about a stolen AT&T source code

document. Here he goes again...source code! The source code program

had a Trojan horse in it. It made it clear right on the face

of it that it was a Trojan horse, a way of stealing passwords from a

computer.



I am going to have to pause here for a second to make

sure that I reassure you again on the descriptions and the items

we'll talk about.



The source code is a type of language. It is kind of a way

human beings write things down as a first step toward communicating

with computers. They write it down in source code, which is

directions. A rough analogy would be if I'm going to give you

directions on how to get to my house. The source code for that kind

of program might be something like:



"Go to the door.

"Open the door.

"Go through the door.

"Go forward to the sidewalk.

"Go the the sidewalk and stop.

"Stop at the sidewalk. Turn left.

"After you turn left, start walking.



- 25 -



Cook -- opening statement



Step by step by step progression along the way. That is kind of what

the source code is about. You will hear, fortunately, a much better

description of this from the witnesses on the stand.



The source code program that was stolen here that

Mr. Neidorf received, again, basically was clear from the face of the

document that it was stolen. And, again, Mr. Neidorf transferred it

out to somebody else. Again, stolen property was received and

distributed in interstate commerce.



The nature of this source code was that it would act a lot

like a false front door to a computer, where you walk up to the

false front door of the computer, you knock on the door, and somebody

inside the door or inside the house says, "Who is it?" The person

knocking on the door uses their secret word, or their name or an

identifier, or it's recognized by the person inside the house:

"My name is Joe Jones."

"My name is Bill Cook."

"My name is Colleen Coughlin."

"My name is Tim Foley."

Except with this door, it was a false door, and what it had the

capability to do is it would record the information. It would

record, "Bill Cook," "Joe Jones," "Colleen Coughlin," "Tim Foley".

Those are the passwords to get into the house that a legitimate user

of the house would use.



But this Trojan horse, what it would do is it would store

those, and after it had stored all that information, it would



- 26 -



Cook -- opening statement



essentially disappear. And the person trying to get in the house would

all of a sudden get a communication from the other side that would

say, "I didn't hear you. Try it again".



It would steal those passwords, and it would then put them

in a private place where the hacker would come back whenever he

wanted to, and just pick up the bucketful of passwords and log-ons,

and use them to break into the same computer systems again and

again, kind of an elaborate piced of scientific perversion but that

is what it is about. That was the document that Mr. Neidorf also

trafficked in as part of this fraud scheme.



The final expert that you will probably hear from on the

government's side is going to be a man from inside the phone

company, a man who was with bell laboratories before he was with the

phone company. His name is Mr. Williamson. Mr. Williamson will talk

to you about the property, the property being the text file, and

the way in which and the reason that the phone company protects

this kind of property, this information.



He will testify, we anticipate, to the obligations of the

phone company, to the significance of the text file, along with

other people, and the fact that the theft was the theft of critical

information for the operation of that system, and that the

proprietary markings made it clear to anyone who took it that that

was stolen and that they didn't have authorization for that document.



No matter what other information floating around about 911

that might be out there, this document was proprietary and contained

the inside information about what this system was all about, and how

an emergency call is driven from the point of someone picking up

the receiver to the time when the help is actually generated from

the fire, police and ambulance stations.



As I've said before, it's that text file that Mr. Neidorf

deliberately compromised into the hacker community. At the

conclusion of this case, we are going to be coming back here and

asing you to find a guilty verdict against Mr. Neidorf for the

interstate transportation of that stolen text file both from the time

he got it from Riggs, and it was sent from Rigs in Georgia to the

bulletin-board in Lockport down to Neidorf at the University of

Missouri, that's one interstate transportation of stolen property,

and the interstate transportation of stolen property, that same

stolen information back from Neidorf to Riggs in Lockport. In this

situation, it was reviewing the stolen property to make sure that

they could disguise themselves. And then the final interstate

transportation of that stolen property when Mr. Neidorf compromised

the text file into the hacker community.



I appreciate your attention. That concludees my remarks.

I ask you to pay as much attention to Mr. Zenner as he makes his

remarks to you this morning.



Thank you.



THE COURT: Thank you, Mr. Cook. Mr. Zenner, are you prepared

to make your opening statement?



<End of Cook -- Opening Comments>

 
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