1 IN THE CIRCUIT COURT OF THE STATE OF OREGON 2 FOR THE COUNTY OF WASHINGTON 3 4 STATE OF OREGON, ) ) 5 Plaintiff, ) ) 6 vs. ) No. C940322CR ) 7 RANDAL LEE SCHWARTZ, ) ) 8 Defendant. ) Volume 12 9 10 11 TRANSCRIPT OF PROCEEDINGS 12 13 BE IT REMEMBERED THAT on the 25th 14 day of July, 1995, the above-entitled matter came 15 on for Hearing before the HONORABLE ALAN C. 16 BONEBRAKE, a Circuit Court Judge. 17 18 APPEARANCES 19 Thomas J. Tintera Washington County Deputy District Attorney 20 Representing the State of Oregon 21 Marc Sussman Attorney at Law 22 Representing the Defendant 23 24 25 2 1 MORNING SESSION 2 BEGINNING AT 9:40 A.M. 3 JULY 25, 1995 4 5 (Whereupon, the following 6 proceedings were held in 7 open court, out of the 8 presence of the jury:) 9 THE COURT: We spoke last night, 10 counsel and I did, on jury instructions. 11 Mr. Sussman expressed some lingering concern about 12 Mr. ***Speck's ability to continue as a juror in 13 this case. I believe -- is there anything that you 14 want to address me on this morning? 15 MR. SUSSMAN: Yes, Your Honor. At 16 this point in the -- the record should reflect the 17 concern that I have, the reason that I would have, 18 I would ask the Court to allow the alternate to be 19 seated at this time would be that despite 20 Mr. Speck's' obvious interest in continuing the 21 case, his commitment, as stated on the record, to 22 carefully deliberating, you have an artificial time 23 limitation that's now been put on the jury 24 deliberation and now we will get the case to the 25 jury probably midday today and the jury basically 3 1 has to deliberate and make a decision to -- at 2 least there will be pressure to get that done today 3 because of Mr. Speck leaving. 4 It's entirely possible that the jury 5 could, given the complexity of the facts in the 6 case, deliberate for longer than the time allowed. 7 And what I want to avoid is a potential situation 8 for either party -- I'm obviously representing 9 Mr. Schwartz's interests -- it faces a situation 10 where there is internal pressure within the jury 11 and its deliberation to come to a conclusion 12 quickly in order to meet that time schedule. 13 The potential problem stated in the 14 case of State v. Jones, which I pointed out to the 15 Court yesterday, and that was a case where the 16 information, of course, came to defense counsel 17 after the verdict had been rendered where there 18 were discussions during deliberations about 19 suggestions by some jurors that they should hurry 20 up to come to their verdict because of some 21 concerns about getting to -- tending to some 22 personal business. 23 In that case, the Court was 24 unwilling to go behind the deliberations and 25 respecting the sanctity of the jury deliberation 4 1 would not consider that as grounds for granting a 2 new trial and points out the potential that we face 3 that if we -- that in order to assure that all the 4 parties have a fair deliberation free from any 5 outside pressures, that -- because we see from that 6 case that this kind of thing can happen, that the 7 only way that really seems assured to avoid any 8 problem like that would be to seat the alternate. 9 THE COURT: Mr. Tintera, anything? 10 MR. TINTERA: Your Honor, the 11 defendant had three peremptory challenges and knew 12 of Mr. Speck's' time restraints at the beginning of 13 this trial. 14 The juror, himself, has -- and they 15 didn't use them. The juror, himself, has said that 16 this is not a problem and that he will be a good 17 juror, a fair juror and an impartial juror. I 18 don't think we can ask any more of Mr. Speck. 19 THE COURT: Well, I have some 20 recollection that early on in this case, I asked 21 counsel about the possibility of excusing Mr. Speck 22 and replacing him with the alternate. And my 23 recollection, and either of you can correct me if 24 I'm wrong, is that counsel concurred that I ought 25 to talk with Mr. Speck and if he wanted to serve, 5 1 let him serve. So I took that approach and the 2 record will disclose that -- I don't know what day 3 it was, that I confronted Mr. Speck, basically, I 4 think, and inasmuch as told him that he could be 5 excused if there was going to be a problem and he 6 at that time said no, he would like to continue 7 serving. 8 And it was that time when counsel, I 9 think, defense counsel, had an opportunity to talk 10 with him briefly and explain appropriately the 11 concerns that we had. And I do recall Mr. Speck's' 12 answers at that time and he would devote such time 13 as was necessary and appropriate and he understood 14 the seriousness of all this. And I just at this 15 point don't believe that there has been any showing 16 of a likelihood that his planned vacation in the 17 San Juan Islands that was set to begin yesterday is 18 going to be a problem. 19 My intent in this case, as it 20 usually is with cases that are not complex -- let 21 me put a footnote in the record here. This case is 22 complex because of the technology involved, but the 23 facts really are not complex. The factual issues 24 are not all that complex. In other words, the 25 questions to be decided by the jury really -- and 6 1 if you listen to the instructions that I will be 2 giving you, the instructions are not lengthy and 3 the factual determination to be made by the jury 4 are not lengthy, nor are they complex. And I have 5 every reason to believe that this jury is going to 6 be able to deliberate and reach a verdict today. 7 And it would be my intent to have them deliberate 8 on into the evening until they either reach a 9 verdict, or if it should be, I doubt it, but if it 10 should be that they report to me they will never be 11 able to reach a verdict. In any case, my belief is 12 we're going to conclude this case today. 13 I assume what you're saying here, 14 Mr. Sussman, you're asking that Mr. Speck be 15 excused and then be replaced by the alternate and 16 I'm denying that motion. 17 We did talk with -- I did talk with 18 counsel about instructions and I've gone through 19 them in a little more detail. I had one question 20 that had to do with the definition to be given with 21 the threat instructions, and Mr. Tintera had asked 22 for the definitions, which is Instruction No. 1800, 23 that 129 and 10 be given. And I added in 3 because 24 it was a request by the defense and I thought it 25 was appropriate. 7 1 But in looking at those, I believe 2 No. 2 as requested by the State is the definition 3 of "conceal," and that's not a word that I think is 4 in any of the instructions that I'm going to be 5 giving. In other words, it might be interesting 6 for the jury to know how we define "conceal," but 7 it's not something that's going to be given them in 8 the instructions. 9 I looked in the Criminal Code and 10 the only place I see the word "conceal" used is 11 when there is a charge of theft by receiving. 12 There one of the alternative means is to conceal 13 property from the owner. That's not the charge 14 here. 15 Mr. Tintera, unless I'm convinced 16 that "conceal" is a word that I will be giving in 17 these instructions when I describe the elements, I 18 don't think it's helpful to the jury to define it 19 for them. 20 MR. TINTERA: Well, I think it is 21 because the theft is a larger definition than theft 22 by receiving. And concealing property is a way of 23 asportating its value to a particular person. 24 For instance, in your analogy at the 25 judgment of acquittal, when the person moves -- at 8 1 Nordstrom's moves property to an area, then 2 concealed conceals it and removes it from the value 3 of the store owner by placing it in an area where 4 they can later cart it off, the purpose of 5 Nordstrom displaying the merchandise is to sell it. 6 By that person moving it to an area where it can't 7 be sold ***ALD for its own purpose is going to be 8 concealed there and it is not merely theft by 9 admitting but theft by concealing. 10 I think that's a legitimate argument 11 and I think that instruction -- 12 THE COURT: I don't question that's 13 a legitimate argument, but I'm seldom in the mode 14 where I define terms for the jury in instruction 15 terms that aren't used in other instructions in the 16 case. And I have not found a place in my 17 instructions where I will give to the jury during 18 an instruction the word "conceal" as some method of 19 committing theft or a term used anywhere in any of 20 the instructions, so if I don't tell them anything 21 about concealing property, why should I define it 22 for them? 23 MR. TINTERA: Because theft includes 24 concealing property. That is why I'm asking for 25 the definition. It includes appropriating property 9 1 to another, of another to oneself, includes 2 depriving another of property and includes 3 concealing property. 4 THE COURT: Can you find that in the 5 definition for what you just said exists or in the 6 statutes? 7 MR. TINTERA: Unfortunately, I 8 didn't bring my statute book. If I could borrow 9 the judicial statute book. 10 THE COURT: Sure, I'd be pleased. 11 Only place I found the word "concealed" used 12 anywhere in the law with regard to property, it was 13 just a quick look, was under the theft by receiving 14 statute. 15 I'm not suggesting that it might not 16 be good argument that you might not request the 17 jury draw inferences regarding concealed property 18 and all that, it's just not in the law that I will 19 give them. 20 MR. TINTERA: 164.015 Sub 1 21 indicates that "a person takes, appropriates, 22 obtains or withholds such property from the owner 23 thereof." 164.015 Sub 1. 24 THE COURT: Read that again. 25 MR. TINTERA: "Takes, appropriates, 10 1 obtains or withholds such property from an owner 2 thereof." And that is the general definition of 3 Theft in the First Degree or Theft. It's the 4 general definition of Theft. Conceal is one theory 5 that fits under appropriates, obtains or withholds. 6 THE COURT: Well, then I should 7 consider, if that's the case, giving a different 8 definition of theft than I will give to the jury, 9 one that might include a charge of theft by 10 receiving or theft by concealing property. 11 I guess what I'm getting at here is 12 in the definition of theft that I will be giving to 13 the jury, it doesn't include an alternative that 14 includes -- 15 MR. TINTERA: What is the definition 16 that you are -- 17 THE COURT: Well, it's the one 18 that's commonly used in burglary cases where a 19 person unlawfully enters into a premises with the 20 intent to commit theft. And I can find that for 21 you very shortly. 22 MR. TINTERA: Well, I would ask the 23 Court to instruct the jury that "theft" means to 24 take, appropriate, obtain or withhold such property 25 from an owner thereof. That's right out of the 11 1 statute. 2 THE COURT: Now I need the judicial 3 copy back. 4 MR. TINTERA: Yes, I have not marked 5 the judicial copy. 6 THE COURT: That's 164.015 Sub 1? 7 MR. TINTERA: Yes. 8 THE COURT: If I do what you have 9 suggested, I still haven't used the word "conceal." 10 MR. TINTERA: I think it helps to 11 explain "withhold." If you would like to -- well, 12 I think we need some definition as to the acts. 13 It's important to the State's theory that the jury 14 know that theft includes conduct that assists the 15 person in converting stolen property to his own 16 use. That is an essential part of my argument that 17 I have prepared for the jury and it is included 18 within the definition of "theft." 19 Theft does not have to be an 20 asportation outside of the building of the owner. 21 A theft can occur within the premises. The 22 definition of "conceal" helps to explain that fact 23 to the jury. 24 THE COURT: Mr. Sussman, anything 25 you would like to say? 12 1 MR. SUSSMAN: Yes, Your Honor. I 2 think the definitions on the theft statute that 3 apply as this case is pled are clearly those 4 definitions in 164.015. The Sub 1, which talks 5 about taking, appropriating or withholding, are 6 defined in the definition section of 164.005, and 7 those are the definitions that we concur apply and 8 create the framework for the State's argument. 9 What the State is attempting to do 10 is in general a concealment based on theft which is 11 neither pled nor applicable under the terms of the 12 statute. And in fact, rather than helping the jury 13 understand, what it does is inject an element or a 14 definition into the theft -- into the statute, into 15 the definition which otherwise is not there in 16 164.005 as one of the statutory definitions. 17 ***(that's the same statement he made right before 18 this.) 19 THE COURT: 164.015 does have the 20 general definition of "theft." The uniform 21 instruction 1035 in there it says, "A theft occurs 22 when a person takes or withholds property from the 23 owner of the property with the intent either to 24 deprive the owner of the property or appropriate 25 property for the person's benefit." 13 1 That's basically what you've asked 2 for, isn't it, Mr. Tintera? That's thefts 3 described in 164.015. "A person takes, 4 appropriates or withholds." 5 MR. TINTERA: Obtains or withholds. 6 THE COURT: Well, I can add the 7 "obtains or withhold" in. I don't know why they 8 left that out. 9 MR. TINTERA: There is no definition 10 of "takes" and there is no definition of "obtains." 11 "Conceal," in the Uniform Jury Instructions, and I 12 don't mind if we change it to "takes" or "obtains," 13 but that is the definition that explains to the 14 jury what those terms mean. They are not explained 15 anywhere else. That's a classic action in a theft 16 act. 17 And the "conceal" instruction 18 explains the taking or obtaining, in particular the 19 obtaining of the property, that it does not have to 20 leave the particular premises and it can be done 21 without actual hiding or secreting, but any acts or 22 conduct that assists the person in converting the 23 property to their own use. 24 MR. SUSSMAN: Your Honor, I believe 25 that's a matter for argument and -- 14 1 THE COURT: Well, it clearly can be 2 argued. The only question is whether or not it's 3 appropriate for the Court to instruct on the 4 concept when I'm not using the term. 5 MR. SUSSMAN: I would have to 6 strenuously ***object to injecting a term that only 7 appears in the theft by receiving statute which the 8 terms of which do not apply. 9 THE COURT: Well, I'm going to 10 decide this. Thank you. 11 Mr. Tintera, I'm declining to give 12 the concept of "conceal." I understand it's 13 something that you intend to argue, and you may 14 argue appropriately, but the terms that I define 15 for the jury will be terms that I use in the 16 instructions and I'm not using the term "conceal" 17 in any of the instructions that I'm giving and so 18 there is no necessity to define it for them. 19 That's my ruling on that. 20 Bring in the jury and we'll proceed. 21 MR. TINTERA: Well, unfortunately, 22 one of the props I've made for the jury includes 23 that definition. Either -- so -- 24 THE COURT: I apologize that we're 25 getting -- 15 1 MR. TINTERA: Now he's going to be 2 objecting in front of the jury. There is no way I 3 can change this now, I don't think. 4 THE COURT: Well, I'd give you a 5 delay if you need to make a change in some fashion. 6 I apologize we're addressing this at this late 7 point. It wasn't until my final reading of the 8 instructions this morning that I began to have 9 concern about the definition of "conceal," and 10 that's the reason I brought it up now. 11 Now, if there is some flip chart or 12 something that you have prepared, is that it? 13 MR. TINTERA: I'll handle it, Judge, 14 thank you. 15 THE COURT: Well, if you wish to 16 have a minute to change that, I'd give you a 17 minute. 18 MR. TINTERA: No, thank you. 19 THE COURT: Bring in the jury. 20 (Whereupon, the following 21 proceedings were held in 22 open court, the jury being 23 present:) 24 THE COURT: Good morning, folks. 25 We're ready now for argument by counsel and then 16 1 I'll instruct you and then you'll begin your 2 deliberation. 3 In argument, the State gets to go 4 first. 5 Mr. Tintera, you may proceed. 6 MR. TINTERA: Thank you, Judge. 7 Good morning. We have been here, 8 this is week three, and at the start of this case, 9 we had people who knew nothing about computers, it 10 was a new area to them, and some people that had 11 some knowledge, and hopefully, although it's 12 difficult to know, through the course of this 13 trial, you've all followed along through the 14 concept of what we have been talking about and 15 received a bit of an education about how computers 16 work, what's appropriate, what's inappropriate, how 17 people use them in their work, how Intel, as a 18 corporation, uses computers, and the people that 19 work there and how they use them. 20 At this point in the trial, each 21 counsel has an opportunity to speak to you both 22 about what the charges are in particular and how 23 the law or the facts apply to those charges. You, 24 as a jury, are the people that determine what the 25 facts are. That is part of your job. You do it by 17 1 looking at the witnesses, deciding who you can and 2 who you can't believe. 3 That's a judgment. We all like to 4 think that when people raise their right hand and 5 swear to tell you the truth, that they're going to 6 do that. That may not be true. That may not be 7 accurate. Some people may -- for their own reasons 8 or motives may not do that. That's part of your 9 job. 10 You're not to look into the future 11 and say what will happen, you're to look in the 12 past and tell us what you think has occurred. 13 That's your job. As a part of that, there is a 14 tendency to say, "What's going to happen if I do 15 this?" You can't do that. You have to look at 16 what happened in 1993. There is nothing we can do 17 to change it and we let the chips fall where they 18 may. People have to be accountable for their 19 behavior. 20 I'd like to go over the charges with 21 you. This chart doesn't stand up very well, so I 22 have to use this. 23 There are three counts that are 24 alleged. Count 1, this is the Gate script that we 25 have been talking about, and what Count 1 says, 18 1 between the dates of November 1st, 1992, 2 November 1st, 1993 -- and this is, it also includes 3 the defendant, Randal Schwartz, in Washington 4 County, Oregon, did he knowingly, was he aware of 5 his conduct, did he know what he was doing and 6 without authorization alter a computer or computer 7 network, Mink and Brillig? That's in its bare 8 essence. 9 So although this trial is laced with 10 computer terminology, it really is a simple 11 concept. Did -- by the installation on Mink and 12 Brillig, did Mr. Schwartz knowingly and without 13 authorization alter those computers? 14 Obviously, the keys are -- 15 MR. SUSSMAN: Mr. Tintera, would you 16 mind moving that back a bit? 17 Thank you. 18 THE COURT: Can you all see there? 19 MR. TINTERA: -- without 20 authorization. Because as we know, the term 21 "alter," we have heard talk about, well, if you 22 typed in your name, wouldn't that alter a computer? 23 Sure, it would. But the point is, that's with 24 authorization because that's how Intel gets their 25 work done. 19 1 Whatever they are doing with those 2 3,000 computers that they have at Hawthorn Farms, 3 the "with authorization" is doing the work. The 4 altering that we're talking about is without 5 authorization. That's what we're talking about. 6 Did he alter a computer beyond the policies of the 7 Intel Corporation? 8 I'm not going to go into all the 9 facts that established these counts right now, but 10 the second count involves between the timeframe of 11 August 1st, 1993 and November 1st, 1993, did the 12 defendant, in Washington County, Oregon, knowingly 13 access or use as a computer or computer system for 14 the purpose of theft? And that specifically 15 references the Supercomputer Division or SSD 16 passwords file. Did he knowingly know what he was 17 doing, access or use the computer system for the 18 purpose of committing theft? 19 And our last count is really an 20 extension of the theft of the Supercomputer 21 Division file and involves the same elements, 22 knowingly accessed or used a computer or computer 23 system for the purpose of committing theft of the 24 individual users' passwords. 25 So this count is taking the 20 1 Supercomputer Division password file and this is -- 2 Count 3 is running Crack against the Supercomputer 3 password file to take the individual users' 4 passwords. 5 So through the trial, as I tried to 6 explain to you in my opening statement, we talked 7 about did he have authorization? Did he know it 8 was within Intel's policies? In fact, many of the 9 people from Intel that were here, supervisor, all 10 of them were produced to establish one thing, that 11 he was never authorized to copy the Supercomputer 12 Division password file and he was never authorized 13 to put in a gate program on any of the computers, 14 Mink or Brillig, that no one in a position of 15 authority gave him that right, privilege, whatever 16 you want to call it. 17 What happened was, Mr. Schwartz, 18 because of his expertise and special knowledge with 19 computers, granted himself a special privilege for 20 computers. In spite of what he knew to be Intel's 21 policy, he granted himself the special privilege 22 because of his special knowledge of one, taking, 23 stealing the SSD password file. He didn't have a 24 right to it. He knew that. He essentially told 25 you that. 21 1 Running Crack against it, we'll get 2 into his own particular purposes. But he said they 3 were for his own purposes. He converted it to his 4 own use, not for Intel's use, and he put this Gate 5 program on because it was easier for him. That's 6 the way he wanted to do it. That's what he wanted 7 to do. 8 But the fact of the matter is, he's 9 getting paid $45 an hour by the Intel Corporation 10 and part of his responsibilities is to follow the 11 rules. If he is not happy with the way that he 12 gets his e-mail, then don't work there. 13 Intel, as a corporation, has a right 14 to set their own security policies. As Mr. Cower 15 told you, it is a risk that Intel is not willing to 16 accept to have an incoming connection through their 17 fire wall and that is a decision that Intel is 18 entitled to make, not Mr. Schwartz. 19 Now, what does "theft" mean? The 20 definitions of theft -- ignore this one, "conceal," 21 for the time being. "Theft" means to appropriate 22 property of another to oneself. Theft, as all of 23 our laws, have evolved over time. 24 Part of the rules of society before 25 we had legislatures, before we had formalized 22 1 rules, there was understandings of groups of people 2 that you just don't do certain things. And those 3 understandings eventually have been codified into 4 law. You don't take your neighbor's food or 5 whatever. You just don't -- there are certain 6 things that we know. 7 We know that in the computer 8 industry, there are certain things that people that 9 work in computers know. It's that sense of trust 10 that eventually gets translated into a criminal 11 charge by the Legislature. So they put in there 12 that you can't go into your neighbor's house and 13 steal the TV. We all know that. Just as 14 Mr. Schwartz knew he couldn't go into the 15 Supercomputer Division and take their password 16 file. 17 So what does appropriate property to 18 another -- of another to oneself, to exercise 19 control over property of another under such 20 circumstances as to acquire the major portion of 21 the economic value or benefit of such property? 22 Well, with a password file, what's 23 the benefit of an encrypted password file? One, 24 it's supposed to stay in the Supercomputer 25 Division, not supposed to be copied over to his 23 1 particular computer. But the benefit of the file 2 is that it stays where it is. It is of limited 3 access, in spite of what Mr. Mayer said, that this 4 is a public access. It is public for the 5 authorized users. Mr. Schwartz was not an 6 authorized user. 7 When you look at, as Mr. Schwartz 8 surely must have, State's Exhibit No. 26 is a 9 readout of the passwords on May -- September 24th, 10 and it shows which ones are working and which ones 11 aren't. And Mr. Schwartz marked this one with this 12 red arrow as his, and right at the end in capital 13 letters, is "disabled." This is the response to 14 his inquiry into the Supercomputer Division 15 password file, his user name is disabled. He knew 16 that, but just in case he'd forgotten, it's right 17 here on his computer screen. And it goes back to 18 October 21st and on October 6, "disabled." So he 19 clearly knew that he wasn't to be appropriating 20 that particular property to himself. 21 And the question, does that deprive 22 from the rightful owner, the Intel Corporation, the 23 benefit of the property? Well, we also know that 24 based on his actions to put back what he had done, 25 as Mr. Cower said, it cost the Intel Corporation 24 1 over $60,000 to fix this, to place their security 2 back where it was supposed to be in the first place 3 before Mr. Schwartz meddled with it. 4 Deprive another of property, to 5 withhold the property of another under such 6 circumstances that the major portion of its 7 economic value or benefit is lost. 8 Count 3, when we were asked after 9 the Crack program had run on the Supercomputer 10 password file what value did those passwords have, 11 well, since they were compromised, they had no 12 value and the defendant demonstrated that by his 13 use of Ron B to go into the Supercomputer Division 14 and steal the password files. As he said 15 himself -- and when you evaluate a witness' 16 testimony, you can evaluate how they testify and 17 who they would answer questions for and who they 18 would not answer questions for. That's a 19 legitimate inquiry for you. And did you notice any 20 differences between how Mr. Schwartz talked to you 21 when he testified -- when Mr. Sussman was following 22 their questions and when I asked him questions? 23 Now, admittedly, I'm fairly close to 24 the facts of this case and sometimes it's difficult 25 for me to get the proper perspective, and that's 25 1 why I rely on you. But it seemed that when he was 2 answering questions from his attorney, he would 3 look to you and he would gesture and he would just 4 talk. But when he -- when I asked him questions, 5 well, either he didn't answer the question, but he 6 certainly was not interacting with you in the same 7 way. **(ck) 8 But look at all the other witnesses. 9 Was there any other witnesses -- even Lou Poehlitz, 10 frankly, I didn't understand much of what he said, 11 he wasn't trying to hide anything. He was 12 answering the questions as every witness except 13 Mr. Schwartz, appeared to answer every question as 14 best they could. You can look at that in assessing 15 his testimony as to whether it should be given any 16 weight or not, and that's a judgment call that you 17 can make. 18 So what we're talking about in 19 regard to the theft definition, did he appropriate 20 property to himself and gain, acquire the benefit 21 of such property? And did he deprive another? 22 Well, you're going to hear the 23 Supercomputer Division password file was right 24 where it was supposed to be, it was still over in 25 the Supercomputer Division. But the point is, it 26 1 was not secure because he had violated a position 2 of trust to use the Ron B password to go in there 3 when his account had been disabled, to take it, and 4 that compromised the security that the Intel 5 Corporation had and that's what we're talking about 6 in Counts 2 and 3. 7 Now, when we're talking about 8 various statements, you'll be hearing instructions 9 about the defendant's statements and this is an 10 area that we need to be careful on. This is an 11 area that the Judge will tell you that you need to 12 make sure that the defendant made the statement and 13 clearly expressed what he intended to say. "Did 14 the witness correctly hear and understand what the 15 defendant said? Did the witness correctly relate 16 what the defendant said? And did the witness 17 intentionally or mistakenly alter the words used by 18 used by the defendant, thereby changing the 19 meaning?" So you want to look carefully at what he 20 said, and rightly so. 21 And let's look at November 1st, 22 1993, when the facts were fresh in Mr. Schwartz's 23 mind. He was talked to by the police, advised of 24 his constitutional rights, told he didn't have to 25 say anything. He cooperated with the police and 27 1 answered their questions. He talked to three 2 different people, and each of them testified to you 3 as to what he what he said, and there is a common 4 thread. 5 Mr. Lazenby spoke to him first, and 6 that was alone. And Mr. Lazenby, in quotes, 7 because the statement impressed him, he wrote it 8 down, he quoted it, made a report out of it, and in 9 quotes, the defendant told Paul Lazenby after he 10 knew what they were there for, talking about his 11 crack activities, deciphering passwords, talking 12 about the gate program, he told him, "I needed 13 them" -- by "them" he's referencing the 14 passwords -- "in case they caught me doing it and 15 knew they would shut me down. So the more 16 passwords I had, the longer I could continue doing 17 what I wanted to do." 18 Special knowledge, he granted 19 himself a special privilege because he was very 20 smart with computers. He decided that he knew what 21 was best for the Intel Corporation, in spite of 22 what they had told him repeatedly, that they found 23 to be an unacceptable security risk. 24 He told Paul Lazenby on November 25 1st, "I needed the passwords in case they caught me 28 1 doing it and they would shut me down. So the more 2 passwords I had, the longer I could continue to do 3 what I wanted to do." He said he had the 4 capability to do it and he knew he could do it. 5 Asked if it was wrong and if he knew 6 it violated Intel's policy, in quotes, "Yes, it is, 7 but I knew I could do it anyway." That arrogance 8 is what brings him here today. If he is working 9 for a corporation, the laws of this state 10 essentially say without authorization, you cannot 11 do certain things. If he is not willing to follow 12 their policies and rules in the laws of this state, 13 then he will either be terminated, but if he's 14 going to be accepting the $45 an hour, then he's 15 got to follow their rules. 16 They set the rules and if it's an 17 unacceptable security risk to have an incoming gate 18 and the fact of whether it's secure or not, 19 although we have spent a lot of time talking about 20 it, is really a false issue. It's a red herring in 21 this case because it doesn't matter if it was 22 secure at all. What matters is whether it was 23 there or not and whether the defendant put it 24 there. 25 What we're talking about is not 29 1 whether it was secure. Intel policy is that it's 2 not to be there. He works for Intel, he's required 3 to follow the policy. So the question is, does he 4 know that policy? 5 Let's look at what he told Jim 6 Lilley. Defendant admits to gate and that it 7 violated Intel policy and was technically illegal. 8 Defendant said he knew this. 9 In regard to the Crack program, 10 defendant initially says for security, but he knew 11 his activities were against Intel policy and 12 technically illegal and he did it to enable 13 continued access to the Supercomputer Division. 14 What he told Rich Cower, that he 15 said he knew gate and cracking against Intel 16 policy. He worried that gate would be found and he 17 needed the passwords so he would have another 18 computer to land the gate on. 19 So of all the password files that 20 were available to him in the Intel Corporation, he 21 says he was just testing out the Snoopy computer, 22 but we know he had what is called root access and 23 System Administrator duties on ***programs of the 24 Domain Name Service, Clayton Kirkwood and Bob 25 Wilcox, the thing that changes Mink into numbers, 30 1 that's how I look at it, and he could have copied 2 password files to them from there to run on this. 3 But why would the Supercomputer 4 Division password file be important to him in 5 regard to the gate program? Well, we heard from 6 Dirk Brandewie that there were nine or so computers 7 at this time that allowed Internet access, Mink 8 being one of them. Except for Super -- the SSD 9 area, that area was rich with computers that 10 allowed Internet access, and that is why he chose 11 that password file; not for Intel security, but so 12 that he could get their password file because those 13 machines that he would then have access to would 14 allow him to place the gate there because they had 15 the Internet access. 16 That's why he chose Supercomputer 17 Division over the Domain Name Server password file. 18 There was a specific intent in his actions and it 19 was to breach security, violate the position of 20 trust and go into the Supercomputer Division. 21 So he had already been closed out of 22 Mink. When they caught him on Brillig, he wanted 23 to have his rich access area to put on his gate 24 program. 25 Let's talk about Count 1. 31 1 "Knowingly and without authorization." The State 2 has proven this to you beyond a reasonable doubt 3 three different ways, four if you count the 4 defendant's system, one of which, I don't know if 5 you notice, was not apparent when we started trial. 6 The first one was Seth Bradley. 7 Let me get my dates correct. I know 8 people have been a little loose with them. 9 In the fall of 1991, Seth Bradley 10 talked about a two-way door that had been set up by 11 the defendant in regard to Carnegie Mellon. Seth 12 Bradley was his supervisor. In the fall of 1991, 13 he told you that he found that gate, found out 14 about it, and he knew it violated Intel's policy. 15 You'll hear a lot about independent 16 contractors don't have -- they can do whatever they 17 can do to get the job done, they don't know policy, 18 but Seth Bradley said that wasn't exactly true. He 19 said, "We went over policy. I talked to him about 20 policy. He knew what the policies were." That 21 makes sense because how can someone administer 22 other computers in IWARP without knowing what the 23 marching orders are from the Intel Corporation? 24 So when he was a Systems 25 Administrator at IWARP, the only way he could do 32 1 that job was to know what the policies were of the 2 corporation so that he could help with their 3 individual computers, could follow that. He knew 4 what the policy was. 5 That's another thing that is not 6 correct, that he didn't know -- after 17 years with 7 various companies, he didn't know the policies of a 8 company that he works for? He knows. Once he 9 granted himself that special license because of 10 that special knowledge, he feels he can ignore them 11 because he's Randal Schwartz and he could do 12 whatever he wants, in spite of whatever Intel may 13 feel is security appropriate for them. 14 So Seth Bradley finds out about the 15 gate program in IWARP. He said no -- I asked him, 16 "You sat down Mr. Schwartz, didn't you, and made it 17 clear in no uncertain terms that this violated 18 Intel policy?" His answer, "Yes." Right then and 19 there Count 1 is established. 20 Is there any doubt that that 21 happened in your mind? Is there any doubt that his 22 supervisor sat him down and told him in no 23 uncertain terms that Intel policy does not permit 24 inbound connections? Okay. That's how we prove 25 Count 1 beyond a reasonable doubt. 33 1 The second time we prove Count 1 2 beyond a reasonable doubt happened in March of 3 1993, and that's when Dirk Brandewie, who 4 administers the Mink computer, found the process 5 running that he wasn't familiar on. He was the 6 Systems Administrator for that computer and he 7 found the door program. That was a two-way Telnet. 8 I'm not very good with these terms so if I'm wrong, 9 rely on your own recollection, but as I look it, it 10 was a two-way door on his Mink computer that was 11 one of the ones that allow Internet access to go 12 outside. 13 The ones with the tags on them, you 14 get to take back to the jury room, by the way. 15 This is what John Kent -- and you'll have the nice 16 glossy copies in there with you. 17 Anyway, this is what John Kent did. 18 It kind of demonstrates the two-way door. So what 19 Dirk found, the two-way door, and goes to 20 Mr. Schwartz and says, "Hey, we can't have the 21 incoming part. We can't have that. Intel policy 22 does not permit the incoming part of this program 23 that you put in. You need to put blocks on it." 24 He says, "Okay." He put blocks on 25 it. And the blocks meant you couldn't come in from 34 1 the outside through the fire wall into Intel and 2 consistent with their policy. He was told that and 3 how do we know he was told that? Because he did 4 it. He put the blocks there like he was told to 5 conform with Intel's policy. And he did it. 6 It wasn't good enough for him. He 7 just couldn't wait to get home to get his mail, so 8 it wasn't good enough for him. So he tried another 9 computer and that was too slow for him. Then he 10 went back to Mink and took off the blocks and was 11 caught in July of 1993. 12 And that's the third way we have 13 proven Count 1 beyond a reasonable doubt. He's 14 confronted again. And in case you think Dirk 15 Brandewie wasn't telling you the truth, we had Mark 16 Morrissey say, "Yeah, we both confronted him and 17 told him what the policy was and you can't have an 18 inbound connection." 19 Rightly or wrongly, Intel gets to 20 set that policy. It's an unacceptable security 21 risk for them. End of sentence. Period. And it 22 was told over and over and over to Mr. Schwartz and 23 he didn't want to do it. 24 If he didn't want to do it, he 25 should have quit. Don't take their money any more 35 1 and go somewhere else where you can do whatever you 2 wanted to do. But when he agrees to take their 3 money, he agrees to stay within the corporate 4 policy, and his actions are unauthorized if he goes 5 beyond that. And he was told over and over again, 6 but he just didn't want to do it. He wanted to do 7 it his own way with that special license and 8 privilege he granted himself. 9 So he -- again, in July of 1993, 10 Dirk Brandewie confronts Mr. Schwartz and says, 11 "The blocks are gone. I told you the blocks had to 12 be there." It is now a two-way gate again. Then 13 he says, "If you want this, get security clearance, 14 get something in writing where somebody will allow 15 you to do this." 16 Now, Mr. Schwartz knew that before 17 when Seth Bradley authorized him to change that so 18 that at IWARP -- so it would be outside the fire 19 wall to allow that access under very limited 20 circumstances with Carnegie Mellon, and that was 21 put outside of the fire wall. But Brillig wasn't 22 outside the fire wall and neither was Mink. 23 So he knew what the process was. 24 You could get a supervisor to okay this, but he 25 didn't want to. As he said, it was going to take 36 1 him too much time. But he was told right then and 2 there, "If you want to have this, get somebody from 3 security to write off on it and I'll let you do 4 it." He didn't do that. He said, "Just close my 5 account." 6 And then what did he do? He went 7 from Brillig or Mink, he took the same gate 8 program, knowing that it was unacceptable to 9 Intel's policy, and put it on the Brillig machine. 10 And if you're not convinced yet, 11 there is really not much more I can say to you, but 12 I'll just throw in for the thought processes, that 13 he did have an inkling of how Intel thought, what 14 Intel thought would be appropriate for access 15 through their fire wall, and that's called the 16 Defender System, a system that Mark Morrissey told 17 you told you he never used, but it was there and 18 that is the way Intel will allow inbound 19 connections through their system with their 20 security within their corporate policy which they 21 are entitled to set. 22 He had an account there. He could 23 have used it. He didn't use it. He wanted to do 24 it his own way with his own license that he granted 25 himself. It is without authorization, it is 37 1 knowingly, and it is a crime in this state. The 2 Legislature has said without authorization, if you 3 alter a computer, Mink and Brillig, you are guilty 4 of computer crime, and that is Count 1. It is 5 proven to you three separate ways beyond a 6 reasonable doubt. 7 Reasonable doubt. As intelligent 8 people, we can all come up with alternative 9 scenarios for anything. That's why when the 10 founding fathers came up with this standard, they 11 said when 12 reasonable people reach a reasonable 12 result based on the facts before them. And I'd 13 submit to you that count has been established 14 beyond a reasonable doubt. 15 Let's talk about the crack he says 16 in the password file, Counts 2 and 3, they are 17 interrelated. They stand alone in that they each 18 involve different aspects and they kind of help you 19 decide or look at -- I don't have this all filled 20 up, by the way, this is not going to take all that 21 long, but let's look at what he said in regard to 22 taking the supercomputer password file. 23 He said he did it for security 24 reasons. He said he did it for other reasons also, 25 those were his personal reasons. But, what do we 38 1 know about his explanation? We know at that period 2 of time the only place he's a Systems Administrator 3 at all is on the Domain Name Service, the DNS 4 service, with either Bob Wilcox or Clayton 5 Kirkwood. And we also know that the Domain Name 6 Service is a service that involves changing numbers 7 to words, as I understand it. That is the only 8 place that he administers a system. 9 He has been taken away the Systems 10 Administrators duties in Bob Wilcox's group except 11 for the Domain Name Server in July of 1993 by Mark 12 Morrissey. He no longer works for IWARP. He never 13 had any security obligations in SSD, according to 14 John Gray, and he was never a Systems Administrator 15 there, only with IWARP, but his contract is over 16 there. And I can say this now, I practiced it last 17 night, the test ***aTom TROPB program was over in 18 the spring of 1993, so that is over. 19 He has no legitimate reason to be on 20 the Brillig system. He's not there to work on a 21 contract. He is there for his own purposes, his 22 own purposes. 23 How do we know that? One, he cracks 24 their password file. Now, we know that he knew how 25 to set up an automatic program to notify any person 39 1 that had a faulty password that would automatically 2 send them a message saying, "Hey, boy, so, you're 3 using a stupid -- or a password that can be cracked 4 by my program. Fix it." Because he did that at 5 IWARP. He knew how to do it and he did it. 6 Did he do that in this case? If 7 this was done for security, as even his own expert 8 said, the Crack program has no security benefit at 9 all if you don't notify the person whose password 10 you've cracked that there is a problem. It has no 11 security benefit if you don't tell the person. 12 None at all. But he also said, if a person is 13 doing it for his own reasons, he would never notify 14 the person that the password is cracked because 15 then they'd fix it. 16 So he goes into Brillig, the account 17 should have been closed on Brillig, we know that, 18 it was an oversight, and he looks at the password 19 file. But he does more than that. He copies it 20 over to his machine. Exactly what Mr. Johnson- 21 Laird said a person that was wanting to do mischief 22 or use their own purposes would do, they'd get it 23 away from there. And then he ran the Crack program 24 against it, compromised passwords, notified no one. 25 Now, defense counsel in his opening 40 1 statement said this all started on October 21st, 2 but we know that's not true. We know, based on the 3 defendant's own laws, that this started -- well, we 4 don't know when it started, but we can show you 5 that it at least was going on September 24th. 6 These are the Crack logs. So we know on at least 7 September 24th, that this was started. 8 On State's 23, we see on September 9 24th at 14:31 the password file from Brillig was 10 entered into the defendant's directory into the 11 "play" CR and then the name of it, password 12 Brillig. 13 A few minutes later, 21 minutes 14 later, the Supercomputer Division password file is 15 entered onto the defendant -- and this is September 16 24th, is entered into the defendant's directory 17 over at Hawthorn Farms from Cornell Oaks. He's 18 admitted to you that he violated the position of 19 trust and uses someone else's password to steal 20 them from the SSD. 21 He was not a Systems Administrator 22 there. His accounts were disabled there. He knew 23 that. He said he -- he had to know that. He said 24 he knew he wasn't supposed to be using Ron B 25 password file. He was disabled there. He had no 41 1 business there. He was trespassing in an area that 2 he had no right to be in. He was doing it for his 3 own personal reasons. 4 If he was doing it for security, 5 then when he ran the Crack program, he would have 6 notified someone. 7 He said his other reason for doing 8 that was that -- if you look at what he told the 9 police, it was right here, "I needed the passwords 10 in case they caught me doing it and I needed 11 someplace to land the gate." Right here is why he 12 was doing it back in November 1st when everything 13 was fresh. 14 Now, he says he doesn't remember 15 anything that he told the police, or doesn't 16 remember that, but it's uncontroverted what these 17 policemen said. And Mr. Cower is not a policeman, 18 but he remembers. He was concerned about Intel and 19 their vulnerability because these passwords had 20 been taken and cracked. He was concerned about 21 that. That was his primary concern. 22 But the defendant knew he wasn't 23 supposed to be in that account. He knew it. 24 Because he's using someone else's password to get 25 there. But he says in his initial testimony that, 42 @ 1 "Hey, I was only doing it -- I wanted to show them 2 that this could be cracked and I wanted to show 3 them how quickly it could be." That's why he said 4 he was waiting until the end of this program or 5 moved it from Wyeth over to Snoopy. But that's not 6 true, and I'll tell you why. 7 On October 21st, he recopied the 8 password file from the Supercomputer Division. 9 Now, if all he was doing is time trials, why does 10 he need a new password file? You would keep the 11 old password file and do a time trial on it. It 12 would make no sense to get a new password file to 13 do your time trial, but it would make sense if you 14 waited about a month to get a new password file to 15 find out if anybody changed this. To find out if 16 people had been changing their passwords. 17 As the policy manuals will tell you, 18 people are to change their passwords at least every 19 three months. So if his private purpose for 20 getting that password file is to use it in case 21 this gate is discovered on Brillig to find -- to 22 find another computer, he has to update that 23 password file and keep on cracking it, which he was 24 doing, which he was caught on October 28th, keep on 25 cracking it to make sure that when those passwords 43 1 are changed, he can still access the system. 2 He's not doing this for time trials. 3 He's doing it for his own purpose and that he wants 4 to be able to put that gate where he wants to put 5 it, because he's granted himself this license to do 6 it because of his special knowledge. That's why he 7 was doing it. There is no reason in the world for 8 him to recopy this file if he's doing time trials. 9 How do we know it's recopied? It's 10 a different size. These numbers on September 24th, 11 54,303. Those are characters, those are like -- it 12 could be fifty-four hundred three and 13 three-eighths, but they are called bytes, so they 14 are just like -- anyway, and it's larger on October 15 21st. It's 56,147, two different files. 16 This isn't time trials. This is his 17 own purpose. He was copying this for his own 18 particular purpose. 19 I cannot show you that in the 21 20 minutes between when he copied the password file 21 for the Brillig machine that he ran Crack on it and 22 then copied the password file. He may have done 23 that earlier and was just updating the records. I 24 can't show you that. 25 So when it comes down to it, Count 44 1 1, which is establishing the gate program on Mink 2 and Brillig, has been proven beyond a reasonable 3 doubt three separate ways. And I'd ask you on 4 Counts 2 and 3 to use your common sense when you 5 look at what he did. 6 It's a common excuse to say, "I was 7 doing it for security." Do we believe that? Does 8 his behavior, what we can see, lead you to conclude 9 that he was doing it for security reasons in a 10 system he had no access to, he was disabled from? 11 He knew he had no business there. 12 He had to use someone else's 13 password to get there. He copies the file away 14 from there so he can run Crack against it and he 15 tells the police, "I'm doing it, I know it violates 16 Intel's policy, I know it violates the law." But 17 what does he tell Paul Lazenby? In quotes, "but I 18 knew I could do it anyway." That's the essence of 19 this case. 20 I will not dispute to you that 21 Randal Schwartz is a computer -- is facile with 22 computers and knows how to use that medium. But 23 when you take the king's gold ***to to the rings 24 gold you follow the king's rule or you don't work 25 for the king. It's simple as that. 45 1 He was told based on experience not 2 to do it. He knew, based on his experience, that 3 you don't use someone else's password. That's a 4 breach of trust. 5 All of our laws primarily, theft 6 laws, are based on a breach of trust. You trust 7 that the vehicle that you got here to the 8 courthouse in will not be broken into while you're 9 here and driven off. Now, there is no guarantee. 10 In a perfect world, I suppose that wouldn't happen. 11 That is part of our social agreement. 12 Now, computer crime is a new crime. 13 It's a new area. It's developing. But Randal 14 Schwartz has been in it 17 years. He has been in 15 it as a Systems Administrator and in security. He 16 knows right from wrong. He basically told you 17 that. And he violated law and violated Intel's 18 policy and he knew this was wrong. 19 He's asking you to ignore that and 20 I'm asking you to hold him accountable for what he 21 did and what has been proven here. You've taken an 22 oath to follow the law. 23 When we talked about the scales of 24 justice with the blindfolds, the scales of justice 25 don't say, "Well, geez, he's pretty smart in 46 1 computers, give him a break." They don't say, 2 "Geez, looks like a nice guy. Give him a break." 3 Goes over the eyes. Passion, prejudice, sympathy, 4 do not enter into the facts of what happened in 5 September and October of 1993. You have to 6 determine those facts and apply the law and justice 7 ***is going to let people accept responsibility for 8 what they have done. 9 I'm asking you to hold Mr. Schwartz 10 responsible for what he has done. Thank you. 11 THE COURT: Thank you. 12 Mr. Sussman. 13 MR. SUSSMAN: Your Honor, Randal, 14 counsel, members of the jury, may it please the 15 Court -- 16 THE COURT: Well, Mr. Sussman, we'll 17 take a short break here so we don't interrupt your 18 argument. Let's take a ten-minute recess here. 19 Okay, ten minutes. 20 (Recess taken.) 21 THE COURT: Mr. Sussman. 22 MR. SUSSMAN: Thank you, Your Honor. 23 Good morning. Almost about two 24 weeks ago when I first had the chance to talk with 25 you in opening statement, I recall, I think I 47 1 mentioned to you that the basic facts about what 2 Randal Schwartz did, his conduct, the specific 3 things that he did really weren't in dispute. The 4 specific things about running -- about setting up 5 certain programs, about running a Crack program, 6 like on the Brillig and SSD password files, those 7 weren't in dispute. But the meaning of those facts 8 is what -- why those things happened, what the 9 motivation was, what his purpose was. Those were 10 the key things in this case. 11 Now, in other words, if you recall, 12 it was his knowledge and intent, his purpose in 13 doing these things. It's not just -- the case was 14 about not just a question of what did Randal 15 Schwartz do, but why did he do it? Was it as 16 simple as the kind of black and white portrayal of 17 the reasons given to you by the State? Or was it 18 for other -- was there a more complex mixture of 19 reasons and factors that entered into the thinking 20 process that went through -- that he went through 21 that was behind the actions that have been 22 described to you? 23 Seems to me that what this case 24 comes down to, to a great extent, we have what we 25 have been arguing about and fighting about is 48 1 whether or not what Randal Schwartz did was a 2 firing offense, whether he did something, whether 3 acknowledging at some point, whether there were 4 things that he did in a way that Intel felt was 5 inappropriate, violated the way they wanted things 6 done, whether it was entirely appropriate and 7 justified to say, "We're not going to have you 8 doing this here. We're not going to have you work 9 anymore," and whether -- so whether there was a 10 firing offense or whether we're talking about 11 felony offenses, and that again comes back to what 12 was going on in here? What was the purpose? What 13 was this man trying to do and why? That's the key. 14 That's the key. 15 Now, Mr. Tintera went through the 16 charges with you and I think it's again critical to 17 repeat that so that we -- because when we go 18 through this, you have to recall that the State has 19 the obligation to prove to you each and every 20 element of those charges, each of those counts 21 beyond a reasonable doubt so that when we say -- 22 when the State charges in Count 1 that on 23 November -- between November 1st, 1992 and 1993, he 24 knowingly altered a computer and computer 25 network -- a computer, excuse me, or computer 49 1 network consisting of Mink and Brillig, and that he 2 did this knowing that he was without authorization, 3 they must prove to you beyond a reasonable doubt 4 that he knowingly altered it, that it was a 5 computer or computer network, and again the key in 6 this count is that when this occurred, he was -- he 7 knew that he was without authorization and 8 knowledge in the law, just like intent, has some 9 special definition that the Judge will instruct you 10 about. 11 It talks about an awareness of 12 certain conditions or facts to be in a certain way. 13 And so in judging and evaluating what is knowledge, 14 what Mr. Schwartz's knowledge was, the issue is not 15 going to be as Mr. Tintera suggested. 16 Did Intel have a policy which said 17 you can't do a certain thing? It is given the way 18 things happened at Intel, given the mixture of 19 signals and conflicting approaches to the policy 20 that either was followed or was not followed or was 21 sometimes as followed in the breach, on or during 22 the breach in the practice, what was the 23 understanding that Mr. Schwartz had about the 24 policy and how did he understand the discussions 25 that occurred with Seth Bradley, with Dirk 50 1 Brandewie and Mark Morrissey about the specific 2 issues involving the gate program in particular, 3 because that's where the knowledge goes to as far 4 as Count 1. And that's something that I want to 5 come back and dwell on a little more later on. 6 That's one of the keys there. 7 In the same -- similarly, in Counts 8 2 and 3, I'm going to lump these together because 9 essentially the elements are the same. The only 10 difference is that in Count 2 and 3 what the State 11 has to do, what they are alleging that's different 12 is that the access of the computers, the use of the 13 computers, Brillig, and of the SSD computers was 14 done for the purposes of committing and with the 15 intent to commit two separate thefts; the theft 16 that copying and running Crack on the password file 17 was, in fact, a theft. It was done for the intent 18 of stealing something, and also that there was an 19 intent in the other count to steal individual 20 passwords. That was the purpose. 21 As far as these counts go, intent, 22 "intent" with its special definition, meaning in 23 the law becomes the critical focal point in terms 24 of determining whether or not the State has proved 25 this charge beyond a reasonable doubt. 51 1 In Counts 2 and 3, as Mr. Schwartz 2 acknowledged to you when he was on the witness 3 stand, he's not saying he didn't use the machine, 4 he didn't have access to it or use Brillig, 5 although on Brillig, the evidence is clear that he 6 had an account at the time and that he had no 7 reason not to believe that he was -- that he was 8 authorized to use that. 9 But the key thing -- and he looked 10 at the password file there and then copied, but 11 that was the step to the key thing as far as going 12 to the SSD password file. And the intent there is 13 whether he had under the law a conscious objective, 14 essentially a deliberate purpose to engage in 15 certain conduct or to achieve a certain result. 16 And again, this is where the thought 17 processes that Randal Schwartz went through when 18 these events occurred become critical to the 19 determination of whether the State has proved this 20 beyond a reasonable doubt. Again, this is why in 21 evaluating these considerations, so much of the 22 other evidence that we have brought into the case 23 and presented to you which sometimes sort of may 24 seem like how does this all fit in, have their 25 place in this case. 52 1 We have given you -- through the 2 course of the last couple weeks, you've heard a lot 3 of evidence about Mr. Schwartz's background, his 4 history, how he's done in other jobs, the way he's 5 approached things, how he learned to approach the 6 kinds of jobs he's done. But not just 7 Mr. Schwartz. 8 What's this industry like? How do 9 people like Randal Schwartz, how do people who are 10 in the position of that Mr. Schwartz has occupied, 11 approach solving problems, approach getting the 12 work done? The critical, creative work, that is 13 what makes companies like Intel successful and that 14 was -- we presented that to you so that you will 15 understand the context and how things operated and 16 the thought processes that Mr. Schwartz was going 17 through. 18 We presented you with information, 19 some of which seemed very technical, about networks 20 and the Internet and security, particularly how 21 these -- this door and the gate programs were set 22 up in terms of the technical nature and what the 23 security features were. 24 The State would suggest to you that 25 was a red herring, but it had a very important 53 1 purpose here, again, because what we wanted you to 2 see and what we want to show was what were the 3 thought processes that Mr. Schwartz was going 4 through in doing these things? What was he 5 responding to in terms of the state of the 6 policies, the state of the local practices at 7 Intel? Exactly what was he told by Seth Bradley 8 and Mark Morrissey and Dirk Brandewie and how did 9 he respond to those things? Those are the things 10 that set the context for understanding these 11 things. 12 Now, in that regard, the factors 13 that we presented to you and the information that 14 you have about how do independent contractors 15 function at Intel and generally how is Intel 16 structured? What was the structure at SSD and 17 IWARP at the time? What was the -- what was this 18 kind of structure that was made up of many 19 different kinds of policies where there were 20 different approaches to practices and policies? 21 These things all set the context and set the place 22 to understand how and why Randal Schwartz was doing 23 the things that he did. 24 Similarly, the State relies very 25 heavily in proving and establishing its case on the 54 1 mental state, Mr. Schwartz's statements both to the 2 police and his comment upon his testimony to you. 3 The context for these things becomes important to 4 you, too, and we'll ask you to consider that, along 5 with the evidence about Mr. Schwartz's character 6 and how given that and the people who have known 7 him and the people who respect him and his work see 8 that in terms of seeing evaluating whether or not 9 this person is coming to you and is trying to 10 explain and present why did this happen and what 11 was I really trying to do, whether this is somebody 12 who is really trying to put something over on you 13 and Intel and everybody else, as the State would 14 suggest, or whether this was somebody who is being 15 really out front, I mean somebody who is being -- 16 the word is not coming to mind, but just being -- 17 is without guile, not trying to be sneaky or hide 18 anything from you. 19 Now, we talked a little bit about 20 reasonable doubt, and let me dwell on this for a 21 moment before I move on to talk with you about why 22 I believe so strongly, why we submit to you that 23 the facts in this case -- that when you look at the 24 evidence there and you evaluate these things will 25 show you that Randal Schwartz was not acting with 55 1 any kind of criminal purpose. That whatever he 2 did, however inappropriate you might have thought 3 his manner of doing it was, however you may have 4 thought he stepped over the line, that these were 5 things that may have been -- may have made Intel 6 justified in taking personnel action against him, 7 but doesn't make him a criminal because he didn't 8 do this with a criminal purpose, with a criminal 9 state of mind. 10 Beyond a reasonable doubt. It means 11 that when you decide whether or not Randal Schwartz 12 had the knowledge that what he was doing was not 13 authorized, that when Randal Schwartz was cracking 14 the passwords and looking on the password files 15 that he looked at, that whether he was doing it for 16 the innocent purposes that he suggested or that it 17 was for the more sinister purposes that the State 18 is saying now or for in truth it was really what 19 compelled the investigation in this case in the 20 first place, the fear that he had was getting into 21 the password, the files of the people in SSD whose 22 passwords had been cracked and that these are not 23 the sinister motives and purposes that really 24 existed. 25 Now, in evaluating that -- remember 56 1 and the instruction -- and we talked about, and I 2 believe the Judge will instruct you that you have 3 to be as certain about your decision in this case 4 as you would be in the most important affairs of 5 your everyday life. You have to give it a great 6 deal of consideration. And when the State asks you 7 to return to verdict of guilty, that you don't have 8 the -- what's the kind of reasonable doubt that 9 would prevent you from doing something that's real 10 important to you. 11 Perhaps one of the best examples I 12 can give you, although it's not quite the same as 13 judging somebody in a criminal case, but think 14 about one of those important decisions, and I think 15 for most of us, it may be buying a house or 16 something like that. Doesn't matter whether it's 17 the first house where you spend maybe 30,000 or 50- 18 or $60,000, or if it's something that you spend a 19 half million dollars for, if we should ever be so 20 lucky. 21 Put yourself in that position and 22 let's say you approached the sale of this house and 23 you're coming time for closing and this is a house 24 that you have found and you really like and this is 25 what you wanted and this is the place you want to 57 1 live. And you're getting ready to close the house 2 and the title company told you somebody just popped 3 up -- somebody said that he did some work on this 4 house and he has a lien on this place, a lien that 5 says it's an interest you have to pay me for doing 6 construction work on this place before we can clear 7 the title and you can have it. 8 Now, the title company may tell you, 9 "We don't know where this came from, we don't 10 ***know it's any good, the person who is selling 11 this place tells us that he thinks it doesn't meet 12 the requirements for a lien and it may not be a 13 valid one, but we can't guaranteed it so we will 14 not give you clear title on the place." 15 And they may tell you that, "We're 16 pretty certain that the way this thing was done 17 that this person that come in with this lien didn't 18 file it in a timely way, may not have filled the 19 papers out just right," but he's got a lien on the 20 house that maybe for worth $35,000 and you wanted 21 to buy the house for 65. 22 Now, before you decide to go ahead 23 with the purchase in that case, knowing that you 24 may not have clear title, how certain would you 25 want to be that this lien is no good? 58 1 In the everyday life, we see those 2 things happen, you want to be sure. You don't want 3 to get in the place and find somebody else coming 4 in that has more claim to the title than you do. 5 You want to be certain because the law requires 6 that you -- in judgment of somebody in a criminal 7 case and deciding that somebody is guilty of a 8 crime, you must be certain beyond a reasonable 9 doubt and at least as certain that you would be in 10 that kind of situation. 11 I would like to talk to you about 12 some of the highlights of the evidence in the case 13 about why we submit to you that the State has not 14 proved each of these elements to you beyond a 15 reasonable doubt. 16 Excuse me. You get nervous and I 17 have to say that it's -- you go through a case like 18 this and you spend two weeks trying this thing, and 19 we have tried to present as much evidence as we can 20 to show you what was happening and why Randal 21 Schwartz was not acting criminally. And we're at 22 this point where I have these sort of imagine of 23 myself missing something or not saying the right 24 thing or doing something that would somehow leave 25 out the critical points that would help persuade 59 1 you, that would show you the facts that show you 2 why there is reasonable doubt here. 3 Please bear with me if I kind of 4 ramble a little bit or say a couple things. This 5 is very important to us. 6 I talked with you about some ways -- 7 some evidence that we brought in to show you the 8 context. In Count 1, again the key point is was he 9 authorized? What did he know? Did he know he was 10 not authorized to do when Randal Schwartz put the 11 programs -- first the door programs and then the 12 gate programs that we're talking about here? 13 Now, the State made it sound very 14 simple and very clear that Randal Schwartz was told 15 over and over again that there is a clear, 16 well-defined, absolute inviolate policy that there 17 will be no inbound telnetting or inbound 18 communication from outside Intel to inside Intel, 19 and he was told that several times by several 20 different people and therefore he knew. 21 But if you go back and carefully 22 scrutinize the evidence and look a little more 23 closely on that, that doesn't hold up for these 24 reasons: 25 First of all, let's go back to the 60 1 earlier situation. When Randal Schwartz started 2 out in his earlier years working at Intel, he was 3 at the IWARP section there, which was sort of an 4 umbrella with SSD, was -- and hadn't yet been 5 brought in in those days. And you heard the 6 evidence that this was sort of like a startup 7 company. This was a group of very energetic, 8 creative, vital people working on some very 9 significant kinds of things. 10 And you had this link going on with 11 Carnegie Mellon, the university in Pittsburgh, 12 where it was essential for them to be able to 13 communicate with the people at Carnegie Mellon back 14 and forth, and also for the people who were working 15 there to get over to Carnegie Mellon sometimes to 16 be able to communicate back. 17 Now, we heard from one of the 18 witnesses that there was a policy in place for -- 19 maybe it was, perhaps, seen as a procedure or 20 guidelines that you weren't supposed to have an 21 inbound connection. But we also know that a 22 decision was made first not by Randal Schwartz, but 23 was approved, authorized by a manager, a regular 24 Intel manager to say, "We need to get this stuff 25 done. Set it up." 61 1 Randal set up the connection through 2 this Cisco routers we were talking about to allow 3 the people working off-site, the engineers working 4 out in Pittsburgh, wherever, to have an inbound 5 connection to IWARP. And you heard from Jim 6 Reinders, one of the engineers working there at the 7 time, how critical it was in order to be able to do 8 his job when he was over there to be able to 9 communicate back. 10 What did they allow him to do? 11 Well, what the procedure, what the program that 12 Randal set up was, was it allowed Jim Reinders and 13 people like him to get on a computer in Pittsburgh 14 and look at their machines just as though they were 15 sitting at their desk inside Intel and do the same 16 work that they could do if they were there. 17 Now, that was the inbound 18 communication that was set up, and at that time it 19 was set up in a way that it was allowing access to 20 the machines that were at Intel that had really 21 sensitive product information. 22 Now, Randal didn't do that 23 unilaterally, but there was a local practice that 24 was driven by the necessity to get the job done 25 that have led to a decision to make this -- to set 62 1 this thing up so it worked. 2 Now, Seth Bradley, who was then -- 3 comes along and says, "Look, we have a problem 4 here, because the way this is set up, it's not 5 secure enough. This is a problem. We do have a 6 policy that says we can't do this," but he did not 7 say that "You can't do this." His testimony was 8 not that this is absolutely forbidden. 9 What he did was, he said, "We can't 10 allow this because we have got -- we can't have the 11 connection coming into the machines that have 12 product information." And what he did after 13 saying -- well, yeah, said, "We can't do it. 14 Change that." He then ready authorized a different 15 setup that still allowed the inbound communication 16 to a different set of machines that didn't 17 immediately access the other computers that had the 18 vital product information. 19 This is very important to remember 20 in terms of later on what impression did this make 21 on Randal? What was the precedent that was set? 22 What did it show about how things would be done and 23 could be done? 24 We have some global policies that 25 are guidelines and we have had to change them to 63 1 meet the needs of getting our work done here. And 2 then policy came along and forced them to make some 3 modification and change that, but we did it in a 4 way that protected the vital product information 5 and that was the way that continued. 6 Rich Cower in rebuttal did testify 7 that prior to 1993, there were inbound connections 8 allowed. The problem wasn't so much that we don't 9 want the inbound connection, but one of the 10 concerns was how do you make these things secure? 11 Also acknowledged that the security problems exist 12 by the outbound connections just as well, but you 13 make a business judgment that you have to do this 14 in order to do business. 15 Now, later on, however, Randal 16 Schwartz is no longer at SSD, his contract there 17 has -- with the SSD IWARP division ended, but he 18 was continuing to work over with -- the contract 19 had started up with Bob Wilcox at the Hawthorn Farm 20 section. 21 Now, here is where our -- some of 22 the information about independent contractors 23 becomes important in two ways and how it becomes 24 important for understanding the thought processes. 25 First, as an independent contractor, 64 1 it meant that Randal Schwartz was not a full-time 2 employee, so what that meant was while he was doing 3 the Systems Administrator and Network Administrator 4 work for Bob Wilcox, and later the work that 5 involved the Domain Name Server business for not 6 just Wilcox but the fellow in California who was 7 running that program, that while he had these 8 contracts, he also had outside jobs to do. This 9 was essential for him to be an independent 10 contractor, one of the things that was essential. 11 So it meant doing some work where he was teaching 12 classes in California. It may have involved work 13 in Chicago, but it was work that took him off-site. 14 Now, he's still a contractor for 15 Intel. He's worked for them for years. This is a 16 person whose testimony did reflect, I think, a 17 commitment to this company in doing things and 18 doing it with a pride and commitment to doing his 19 job well. 20 Now, one of the things that Bob 21 Wilcox -- one of the documents that he signed in 22 his authorization forms in State's Exhibit 14 was a 23 sponsor statement here that there were going to be 24 times where Randal Schwartz had to have access to 25 Intel property at odd hours because -- the reason 65 1 is because there will be times when at off hours, 2 you have to respond to an emergency. Things come 3 up. 4 Remember, John Kent testified that 5 being a Systems Administrator, doing the work like 6 that isn't something that just made up our job. 7 You could have 20 things happening and only have 8 time to do 10. You could have -- when Randal 9 Schwartz went through all of those resources and 10 talked about the things that came up, read about 11 invoice after invoice, talked about fires, putting 12 out fire walls, the person who is doing that kind 13 of work is constantly responding to crises, crises 14 like when Lou Poehlitz changed the configuration 15 for e-mail over at SSD and people at IWARP suddenly 16 stopped getting their mail and went nuts. It was 17 like for days, "We can't get our e-mail, we can't 18 get our work done. Fix it." This is the kind of 19 stuff that he had to respond to. 20 So we see here it required some 21 access at odd hours when he was in town. What do 22 you do if you care about your job and you're 23 committed to what you're doing if you are teaching 24 a class in California? What do you do if you're 25 teaching a class someplace else? Do you let 66 1 somebody else handle it? You could. 2 That's not who Randal Schwartz is. 3 He wanted to be able to have access to his Intel 4 e-mail, not just his e-mail from his publisher out 5 in the Internet there, but when he was away so he 6 could get access to his Intel e-mail inside. Why? 7 As he told everybody, so he could do his job, so he 8 could respond to the messages and the crises that 9 came up. So he could be more efficient and more 10 effective at doing the work that he contracted to 11 do, which he felt committed to doing. 12 That ethic of you do what you need 13 to do to get your job done is something that he 14 learned from his first days at Tektronix with Lyle 15 Settle. It is an ethic that is not peculiar to 16 Randal Schwartz. You heard it from Jim Reinders, 17 who was talking about you do what you need to do to 18 get done. 19 John Kent even talked about that 20 when he was responding to the problems that they 21 felt were created within their investigation when 22 he started trying to track down the -- what the IP 23 address at O'Reilly was. Didn't know, just had an 24 IP address, didn't know, altered the computer, 25 thereby having it make the change, did that without 67 1 anybody asking, that wasn't an issue. It was a 2 crisis that he thought was there that he had to 3 respond to and it was something that he did. He 4 acknowledged that you do things to get the job done 5 when you have to respond to a problem. 6 That's the kind of ethic that -- and 7 the kind of drive that -- which so many -- so many 8 people believed and operated on the theory that 9 this is what we should be doing to make this -- the 10 jobs work, to make these companies we work for 11 successful. 12 So what happened? Randal Schwartz 13 is now working as a contractor with Bob Wilcox and 14 he's out doing his work as an independent 15 contractor and he needs to have access inside of 16 Intel as well. 17 Now, Intel did have this defender 18 call-back system. You could call the telephone on 19 the modem and call in and communicate that way and 20 that was authorized and it was set up and Randal 21 had an account on that and he never used it. And 22 why? That doesn't seem right? But remember there 23 was some discussion and there is a document -- one 24 of the documents here showing the notes for his -- 25 Exhibit 104, which is showing the notes for the ID 68 1 numbers for the defender system showed the 2 telephone numbers and the only access was from 3 these telephone numbers. 4 So if he was doing work in 5 California, he was doing work someplace else, he 6 couldn't use this system to get access to your mail 7 and stuff inside. So if you want to do it and you 8 want to get the job done, you find a different way 9 to do it to make it work. 10 What did he do? Fell back and -- 11 what did he do at IWARP? He set up the door 12 program. Why do we talk so much about the security 13 of the door program? The door program, the one you 14 start out, you have to have a password, first you 15 have to know the IP address, then the right port 16 number, then you get a blank screen and get 17 passwords and you have to guess all of that stuff. 18 The significance of that? Because 19 these were a series of safety security measures 20 that were built into the program the way it was 21 written. 22 Why is that important? Well, it's 23 because in looking back to what was done at IWARP, 24 you had the same kind of inbound connection. You 25 needed to make sure there were all kinds of 69 1 security precautions and they are to protect Intel 2 from the outside intruder. 3 This is the program that Dirk 4 Brandewie saw and Mark Morrissey saw and came to 5 talk about. They said -- there was mixed 6 testimony, and please, I'll ask you to rely on your 7 notes and your recollection of this, but on direct 8 examination, Dirk Brandewie said, "I told him this 9 is against policy, you can't do this." 10 On further questioning on 11 cross-examination, Dirk Brandewie said -- I can't 12 tell you the exact words. I can't tell you exactly 13 what was said, but he acknowledged that the 14 conversation he may have -- that he said that this 15 is not -- this could very well not be secure as 16 it's written, or the problem is it's not secure 17 enough. This is not acceptable as it is written, 18 as it's constructed, as the program is written. 19 Mark Morrissey, also on 20 cross-examination, acknowledged and indicated that 21 the program, he said -- I'm looking at my notes. 22 The quote I had was it was not acceptable as 23 constructed. 24 On direct examination by the State, 25 Mr. Morrissey was asked if Morrissey told Randal 70 1 Schwartz that what he was doing violated Intel 2 policy, and Mr. Morrissey's answer was it violated 3 Intel security procedures. Security procedures. 4 That was his exact response. 5 As I said, on cross, he said it 6 wasn't acceptable as constructed. Why isn't that 7 significant? ***Didn't, he had. He have. Why is 8 that significant? Well, it's significant in this 9 respect: 10 First of all, there was a message 11 sent that this gate program isn't secure enough 12 because it allows -- if somebody gets through, it 13 allows them access to any machines in Intel. 14 Now, as we went to great length to 15 show you, that was a very unlikely event. Like an 16 onion, there was layers upon layers of security 17 there. In the event you got through all the 18 layers, yet you got to a machine that you could, in 19 theory, if you got to another password, get you to 20 a machine anywhere inside of Intel with product 21 information. 22 So there was a message, this is 23 not -- the message that was also conveyed was, as 24 constructed, this is not secure enough because it 25 opens up the entire system if you get through the 71 1 security measures that are there. 2 We spent a lot of time talking about 3 the literal-mindedness of Mr. Schwartz, not only 4 Mr. Schwartz, but people who are programmers, 5 Systems Administrators, and we had to spend some 6 time talking about it and it was demonstrated to 7 you by the way a lot of the witnesses were 8 responding to questions. 9 I think of attorneys sometimes -- as 10 we think of attorneys sometimes as being splitting 11 hairs and just sort of being very precise, and 12 there were frequently times that we would ask 13 questions that our witnesses would kind of pick 14 apart because it wasn't precisely the way that they 15 would interpret the way computer systems are set 16 up, where if we said "program" and we were talking 17 about a computer, we would get corrected on these 18 things. 19 Well, the reason why that's 20 significant is the thought process that's here. 21 Because in response, when we have this response and 22 say this program is not secure enough, it's not 23 acceptable as it's constructed, then Randal 24 Schwartz looked at this and said, "Okay, what do I 25 need to do to construct this to make it acceptable? 72 1 What do I need to do to construct this to satisfy 2 the security concerns?" 3 Well, first they went to the gate, 4 to Door No. 2, and Door No. 2 did have the 5 limitation of saying no, you could not have 6 anything inbound. But it was after that that 7 remember, he started doing more of the contract 8 work that took him out of the company again. And 9 so looking back upon his experience and looking 10 back upon what happened in the experience at SSD at 11 IWARP, he said, "Well, what did we do there? How 12 do we respond to the problem?" 13 What Seth Bradley said was, the 14 policy is we can't do this. But then he went ahead 15 and authorized me to set it up in a way that 16 allowed it to come into some specific machines that 17 didn't have access to the important product 18 information. And so from that, some more 19 tinkering, some changes, a new program, 20 adjustments, not just taking the same program and 21 putting it someplace else, but a new program was 22 written that changed the configuration, that did 23 something different. 24 And out of that was borne what we 25 are -- and Andy Johnson-Laird said was Gate X, and 73 1 said now, if you can find your way into the system 2 through the layers of security and through the IP 3 address and so forth, you just get into a single -- 4 this single machine and it was a single machine 5 that Mr. Schwartz pointed out that contained no -- 6 what he saw as no product information. And so it 7 was an attempt to construct this in a way that was 8 consistent with the practice that he had engaged in 9 sometime previously when this problem came up at 10 IWARP. 11 Now, this is not a question of 12 should he have known? Is this reasonable? We're 13 looking at a different perspective here. We're 14 talking about a community which thinking not in 15 terms of how is criminal law set up? 16 If there is a general prohibition, 17 when we think about general prohibition, we think 18 about all the ways we could violate it and stay 19 within that and don't look for something that gets 20 you out of it. You look at "I have a problem 21 here," because this is the problem, looking at it 22 saying, "I have a problem, here is the limitations 23 that are set. Now, what allows me to do what we 24 need to do to get the work done, to solve the 25 problem that impedes getting the work done and 74 1 doing what we need to do this?" 2 It's that literal-mindedness that we 3 spent time talking about that is important for 4 understanding the mental state and the thought 5 processes that went behind this. 6 Now, when that Gate X program -- 7 that was not the one that Dirk Brandewie found 8 running later on. Randal Schwartz made an 9 additional adjustment, fine-tuning, like he would 10 fine-tune the other programs that we were talking 11 about, the tools of his trade. That was one that 12 was found and that one had combined two different 13 kinds of security features, again to adjust the 14 needs of getting work done, allowing him when he 15 was outside to do only those things that he could 16 do sitting at his own desk inside Intel. And he 17 built in the additional procedure of these things 18 that allowed him to monitor whoever logged in to 19 make sure it was secure. 20 These are the actions of somebody 21 who was trying to construct a program, trying to 22 construct a vehicle for performing what he saw his 23 responsibilities under his contract for doing 24 better at what he was there to do. And one of the 25 ways that it was important was being able to get in 75 1 touch with the outside, the mail on the Internet, 2 because Randal Schwartz had developed a practice of 3 following whatever on the Internet using his 4 address at O'Reilly to get in touch with other 5 people around the community who were expert or who 6 had ideas and shared things and they would do 7 favors for each other. And so if there was a 8 problem inside of Intel, he could get back out 9 there and say, "I have this problem, anybody have 10 some ideas?" And you exchange things. 11 It was this exchange of favors, this 12 exchange of information that not only made him more 13 effective and made him so good at what he did, but 14 it was also one of the things that comes into play 15 later in this case when we look at the processes 16 that led to the running of the crack programs on 17 Brillig and on the SSD password file. It was 18 that -- it was consistent with that kind of 19 behavior and that kind of habit. 20 So what the State said to you that 21 we proved that in three different ways he knew he 22 wasn't authorized to run this gate program, the 23 first way was because of what Seth Bradley told him 24 years ago at IWARP. We submit to you that there 25 was -- the evidence there about what actually 76 1 happened there contradicts that. It does not 2 establish that. 3 When Dirk Brandewie -- the second 4 time they say this was proven is when Dirk 5 Brandewie and Mark Morrissey came to him and said, 6 "You can't do it this way." We have the -- if not 7 contradictory, at least the statements that could 8 be taken different ways. And I recall that there 9 was one other thing that Dirk Brandewie said about 10 that that was very significant. 11 If you recall, Dirk Brandewie said 12 when he first came to Randal Schwartz and told him, 13 "You've got this program, this is not acceptable 14 the way it is," this is the door program that he 15 saw there, he said Randal Schwartz was surprised. 16 He didn't say, "Oops, I got caught." He said 17 Randal Schwartz was surprised by this. 18 Now, that is a very telling comment 19 because it would -- what it suggests was that this 20 was the response of somebody who believed that what 21 he was doing was an appropriate program. It belies 22 the comment and the testimony of Detective Lazenby 23 about Randal Schwartz's statements about this 24 program when he testified here that Randal Schwartz 25 said he was caught running the door program, 77 1 because it's just not -- it's not consistent both 2 with Randal Schwartz's recollection, not so much 3 the specifics of what he said, but this is not what 4 he would say. And it's contradicted by Dirk 5 Brandewie's own testimony about Randal Schwartz's 6 recollection at the time. 7 Perhaps to digress and talk about 8 those statements, because Randal Schwartz's 9 statements are the cornerstone of the theory of the 10 State's case. They want you to accept face value 11 as reported by the detectives who came in and 12 testified as the most accurate -- as accurate 13 descriptions of what was said, what was intended, 14 what was meant and what was -- and what Randal 15 Schwartz was really trying to communicate. 16 Consider, we talk about the context 17 of things. What was the context that those 18 statements were given? Compare that context with 19 to the testimony that you've heard, which you can 20 evaluate on your own. 21 Randal Schwartz gave statements to 22 the police when he was surprised by the knock on 23 his door on November 1st in the evening by several 24 detectives and a number of deputy sheriffs who came 25 to his house, "We have a search warrant, we're 78 1 coming in." 2 Now here is a person who has had no 3 experience with this before. Here is a person 4 who -- think about for a second, use common sense, 5 you can do that in evaluating this, you think about 6 how normal -- most average people respond to 7 getting stopped -- just by getting stopped by a 8 police officer for speeding or a moving violation 9 and what does on there, and then consider the 10 context that Randal Schwartz was in where all of a 11 sudden you have your house full of police telling 12 you that, "We have a search warrant here to seize 13 your -- that -- the warrant that allows us to seize 14 your computers, to seize your data, to seize this 15 information, and we're looking for evidence of a 16 crime." 17 And he's read his rights that -- 18 its' rights that -- where you see are read to 19 people who are supposed to be criminals. And then 20 the first conversation that he has with Detective 21 Lazenby is, "Oh, you're not in custody, but you can 22 be charged with misdemeanors or felonies in the 23 state and even a federal offense." Then the 24 conversation goes from there. 25 What Randal Schwartz told you is, "I 79 1 cannot tell you that I remember the details of each 2 of the conversations." So he didn't get up here 3 and try to tell you, "No, I didn't say this 4 specifically. I didn't say that specifically." 5 What he tried to communicate to you in his 6 testimony was there were some things that didn't 7 sound right, that don't seem like me, that don't 8 fit. I didn't say the word 'caught.' That's not 9 something that I would use, 'caught.'" 10 Didn't fight with what was going on. 11 He was trying to communicate his reasons for 12 wanting to have access to the SSD computers. He 13 was trying to explain, "I really wanted to have an 14 ability to continue getting access to the Internet 15 so that I could read my Intel e-mail." And that 16 came up in the context after the first thing he 17 told the police, which was, "Well, I was -- my main 18 motivation was trying to test the security here." 19 But in evaluating these statements, 20 also consider this. The Judge is going to instruct 21 you to view these statements with caution for some 22 of the reasons outlined by the State. The reason 23 you have to think about the context, did he express 24 what he intended or the emotions or circumstances 25 such that he might not have expressed what he 80 1 intended or said things in a way that came out 2 incorrectly. 3 You've seen just in the stress of 4 the trial here witnesses misspeaking, witnesses 5 saying, "Well, if I testify this way a different 6 time, maybe I didn't express myself correctly." 7 Detective Lazenby said -- he testified here that he 8 took no notes of his conversations with -- I'm 9 sorry, that he took notes of his conversation with 10 Randal Schwartz, that's why he could write the 11 quotes down, although "caught" was not in quotes in 12 his report. But a month earlier, he testified that 13 he took no notes. 14 Now, was he mistaken? Was he 15 confused? Had he misinterpreted the question? 16 Perhaps. That's the kind of thing that can happen. 17 What is so illustrative of that kind 18 of situation with Mr. Schwartz's statement is the 19 last statement that Detective Lilley talked about. 20 Detective Lilley was certain Randal told him that 21 he had been suspended at Tektronix for a security 22 incident where he was using his skills to get 23 into -- to kind of -- as I would -- as they would 24 put it, break into some computers or break into 25 passwords or something. I'm blanking on the 81 1 details. The question of that was he was certain 2 that Randal Schwartz said he was suspended. 3 Now, the curious things about it is 4 this, we know not just from Randal Schwartz's 5 testimony but from Lyle Settle, who was the person 6 he was working for, he was not suspended. That 7 didn't happen. Now, the incident happened, but he 8 was not suspended. 9 What does that tell us then about 10 these statements? Either Randal Schwartz did not 11 tell Detective Lilley that, Detective Lilley may 12 have misinterpreted what was said or misunderstood 13 it, but Detective Lilley was certain that he had 14 said it. But maybe Randal Schwartz said something 15 like, "Maybe I was suspended," and if he did, he 16 was telling him something that didn't happen. That 17 demonstrably didn't happen. Why would he do that? 18 Didn't make sense to say it didn't happen? 19 It's the kind of thing that happens 20 under the stress of a moment like that where you 21 speculate about what -- well, maybe -- "Well, the 22 officer has told me I can be prosecuted for this. 23 May very well be this is a technical violation of 24 the law." 25 Please consider when you -- the 82 1 context of how this happened and how that can 2 affect the statements and a person's ability to 3 communicate under those circumstances. 4 I ask you to again consider what you 5 have seen in terms of Randal Schwartz's testimony. 6 The State has made a point of trying to suggest to 7 you that you really shouldn't rely on that because 8 he sat up here on the witness stand and then talked 9 with you on direct examination, but on 10 cross-examination, all he did was mostly -- 11 confronted with leading questions, he talked mainly 12 to Mr. Tintera. 13 Now, I'll trust your observations, 14 but I think most of the witnesses tended to respond 15 in the same way. Some of the State's witnesses 16 were notable, also. 17 Dirk Brandewie, who wasn't 18 necessarily the most articulate guy, but expressed 19 himself well. Made sure he turned to talk with you 20 on direct examination. He didn't do that on 21 cross-examination. 22 John Kent, the guy's presentation 23 that was worked out and on direct examination made 24 sure he turned and talked to you. Wasn't quite 25 doing that on cross-examination. 83 1 This -- does it mean that these 2 folks are lying? Means there is a difference in 3 the way people respond under these circumstances 4 and under the stress of when you are feeling like 5 you're being interrogated by somebody who is not 6 there to ask you what happened, but who is there to 7 make you feel like maybe this person is trying to 8 trick me into saying something I don't want to say 9 or is not accurate. 10 My final thought for you on the 11 issue of the door and gate programs is that the 12 reason we spent the time that we did and went 13 through the steps with Mr. Schwartz, with Andy 14 Johnson-Laird, was to show you that the way 15 things -- also to show you the way things are 16 portrayed by some of the Intel witnesses when they 17 said categorically in the broad statements, "These 18 things not only violate policy, but it just did it 19 in a way that left us wide open and vulnerable," 20 was not accurate. 21 That there were layers of security 22 and steps taken to protect that and nobody that 23 contradicted, for instance, Mr. Johnson-Laird's 24 testimony. That when you look at that, at the 25 first program that Randal Schwartz constructed, 84 1 that if you got through it all could open up the 2 access to everything. That it concerted -- that 3 running a test program, a concerted effort by a 4 computer robot-like program on a system that was 5 secured at Reed College doing that kind of 6 challenging took such a long time that it had no 7 practical value, it would have had no practical 8 value against the program that was set up. That it 9 was actually far more secure than the Intel 10 witnesses would suggest to you. 11 Why is that important? Because it 12 shows that we're not just talking about how did 13 Randal Schwartz think or what did he think was 14 going on, but is something that was a critical 15 issue in evaluating not only Count 1 -- 16 MR. TINTERA: I object to counsel 17 interjecting -- sorry to interrupt -- but his own 18 personal opinions into the argument. 19 THE COURT: Sustained. 20 MR. SUSSMAN: I'm sorry. 21 Unfortunate choice of words. 22 But it is a significant factor that 23 the evidence produced that would indicate to you 24 what is happening in this case beyond just what 25 Randal Schwartz thought when he was doing this 85 1 thing. Sort of what was really driving this case 2 along. 3 Think back to how this whole 4 incident blew up. What occurred there? Mark 5 Morrissey checking about the file for his system, 6 decides to look at the computer Snoopy to see 7 what's happening, to see how it's working, to see 8 if it's functioning well, and also to see if Randal 9 Schwartz is running any programs on it because he 10 knows that Randal Schwartz likes to test the newest 11 equipment and likes to use something that requires 12 a lot of power, and he finds this Crack program 13 going on. Then sees that it's running very clearly 14 against the password file from SSD, finds that a 15 number of passwords have been broken. 16 They find, upon looking at it 17 further, that these passwords included the 18 passwords of Ed Masi, who came in and testified, 19 and this other fellow, Justin Rattner, who was 20 almost as high up, the guy who is the chief 21 engineer and architect of this whole thing. 22 These are guys whose files are 23 supposed to be protected by secure passwords, 24 passwords that would avoid exposing the company to 25 the danger of somebody breaking in from the outside 86 1 by having secure passwords, and they suddenly find 2 that this guy over here, who is not in SSD now, has 3 worked the passwords. 4 And what happened was, and think 5 back and follow what happened, there was -- I will 6 characterize it as perhaps a panic here. We don't 7 know what Randal Schwartz is up to. We know he's 8 running the Crack program and also ran the gate 9 program running on Brillig. 10 Now, what are they thinking? We 11 don't know what's happened, but the fear is and the 12 conclusion they've come to is that Randal Schwartz 13 may be -- must have been going in to try to get to 14 those files to get this very important product 15 information, the stuff that would be in Ed Masi's 16 file, the chief architect's files. 17 The only way to find out is to do a 18 couple things. One, let's freeze -- they froze his 19 files, backed everything up so they could see 20 exactly what he has on the machines at Intel. And 21 they copied all the files, saw exactly what he had 22 on his records at the Brillig machine. 23 And then the next thing they did, 24 was, "We want to see what's on his laptop," the one 25 they bring in and out. They can receive everything 87 1 they have on the workstation, the machines he's 2 working on inside of Intel, but we're worried he's 3 taking the stuff out and -- but we can't do it 4 ourselves. The only way we can find out if this 5 guy is really stealing the king's gold, the real 6 king's gold, is to call the police because we 7 can't -- we're afraid if we ask him he'll say, "No, 8 you can't look at my computer." 9 He was certainly more cooperative 10 than that when the police showed up, according to 11 their testimony, so there was a meeting to talk 12 about this. And what was interesting and if you 13 will recall, there was testimony that the people on 14 the line, the folks who were working at the 15 colleague level say, "Let's ask him. What is he up 16 to? What's going on here?" But a management 17 person came in and said, "No, we're going to the 18 police." 19 And so we now have this prosecution 20 starting and we have it because we need to get the 21 police here to grab the computer, look at the 22 stuff, because we are, at Intel, certain that 23 Randal Schwartz must have been going after this 24 information in the files there. 25 So they seize his computers and they 88 1 size all the stuff that was related to that. They 2 didn't leave the -- they didn't just seize the 3 computer and leave thousands of disks behind that 4 could have been his. They saw what was the 5 brother's and didn't have anything to do with the 6 stuff that Randal Schwartz had, and they took all 7 of his stuff and they looked at it and looked at it 8 carefully. 9 Alan Watson went through that to 10 make a mirror image so you could see what was there 11 at a point that Randal had opportunity to know this 12 was coming. There was no opportunity to hide what 13 may have been stored there. They got the computer 14 programs that would help them not only make the 15 mirror image, but search through everything with 16 the keywords that Intel provided to see if there 17 was sensitive information. 18 They were able to look to see if 19 there were ways of looking for erased files, and 20 that search that was done thoroughly by Alan Watson 21 and reviewed by Mark Morrissey, revealed nothing. 22 It revealed nothing on those computers there that 23 would -- there and what -- and there was no 24 evidence that he had taken the thing and there was 25 nothing in the files at Intel that showed that he 89 1 had taken -- that he had been copying the materials 2 from the files where the really critical 3 information was being stored. 4 Now, the State may come back and 5 argue later on that this is beside the point, this 6 is irrelevant, this is not the charge, but the 7 interesting thing is that when this case started 8 out, that was the point of it. That was the 9 theory. But when they found nothing, when all that 10 was left was that Randal Schwartz had said, "Look, 11 yeah, I was using the password, I looked at the 12 password files, I was hoping that if I could do 13 pulling off a coup and say, 'Look, you guys have 14 problems here and I'm going to ride in on a white 15 horse and fix this up and show you what the problem 16 is with the security,' that may be somebody will -- 17 I can ask for a favor back and I can get the access 18 to the SSD machines," which were the fastest ones 19 which would allow access to the Internet. 20 For ***me there is one point that I 21 remembered about Count No. 1. The reason when 22 Randal Schwartz was told by Dirk Brandewie, "You 23 can't do this anymore. If you want it, get a 24 waiver, a security, to go back to be able to run 25 this program on Mink," what he said at the time was 90 1 real interesting, was that -- something to the 2 effect, "If it was a little more secure it would 3 have been okay," in addition to everything else he 4 said. Again suggesting to us that perhaps that 5 program might have been allowed. Just didn't like 6 the way was built. 7 But Randal Schwartz said to him, 8 "Look, if I can't do it here, if I can't run this 9 thing on Mink, just cancel the account." It was 10 not that his account was taken away from him, as 11 one of the earlier Intel witnesses testified. It 12 was, "Cancel the account. I don't need it if I 13 can't use it here," because Mink was the machine 14 that was under Dirk Brandewie's control in this 15 area, in this pod, in this section. 16 And the reason he ultimately went 17 over to the Brillig machine where he had the valid 18 account was it was an SSD machine, it was a place 19 where he knew from his prior experience that we 20 have done this before and I set it up in a way that 21 he could go into a machine and get that. 22 Sorry for that digression. Thank 23 you for understanding. 24 A word on policy. A lot of talk 25 about policy. Again, it's important to understand 91 1 the context and state of mind in two ways. Policy 2 was not as clear and as unequivocal as the State 3 suggests to you. We spent -- the reason we spent a 4 lot of time talking with and asking witnesses about 5 what was the policy on independent contractors 6 having secure control over security, could 7 independent contractors be Systems Administrators, 8 could they have call-in access. 9 You have conflicting responses. 10 Some said yes, they could, some said no, they 11 couldn't. Some people say, "Well, policies were 12 disseminated, but we never distributed the manuals 13 to the independent contractors." Some said they 14 didn't get the same information as other people, 15 was to show you that while, yes, there were 16 policies in place, that the policies were not 17 uniformly understood nor uniformly followed. That 18 policies such as Systems Administrators shouldn't 19 be independent contractors were disregarded when it 20 was necessary to get the job done. That just like 21 the policy on no inbound telnetting was, at least 22 in Randal Schwartz's experience, not followed 23 locally in order to get an important job done. 24 And while Intel may -- while it's 25 entirely appropriate for Intel to say, "We have 92 1 policies that say we want things done a certain 2 way," it would not, and that's perfectly 3 understandable. It is not understandable and it is 4 not appropriate to come in and use the power of the 5 State to prosecute Randal Schwartz for doing 6 something in a way which then violates -- they say 7 violates policy which -- or sets a policy which 8 were not uniformly followed or were consistently 9 applied within the company. 10 This is not an employment case. 11 We're not talking about saying, "You overstepped 12 the bounds. You're fired." We wouldn't be here. 13 We wouldn't be arguing about that if that was the 14 case. We're arguing about whether it's appropriate 15 to convict this man of a felony for doing that. 16 I wanted to talk now about Counts 2 17 and 3. And again I want to talk through with you 18 Randal Schwartz's thought process, as you can 19 understand that this was a person that was not 20 acting with any kind of intent to steal anything or 21 to take anything that was strictly for his own 22 purposes. 23 Randal Schwartz was acting in a way 24 that was consistent with a practice that he had in 25 the past of following -- looking at a problem, 93 1 seeing something new, seeing a new challenge and 2 allowing his curiosity and his determination to 3 find out what was this all about? How did this 4 work? Why do things happen this way? What can I 5 do with this to make my job better and do things 6 better and help a company and see that thought 7 process through? 8 Now, it is true that Randal Schwartz 9 at the time he started running these crack programs 10 was -- did not have the same System Administrator 11 responsibilities that he did when he started 12 working for Bob Wilcox. 13 One of the things that was implicit 14 in what Andy Johnson-Laird talk to you about and I 15 think -- excuse me, I suggest came through to you 16 in Randal Schwartz's testimony was that you may not 17 have the specific title of Systems Administrator 18 over a certain set of products, but that doesn't 19 mean you stop thinking in those terms. Doesn't 20 mean you stop approaching problems or things that 21 come up in that way. 22 So we have a situation that came up, 23 well, as best we can gather, sometime around 24 September of 1993, and Randal was looking on the 25 Internet and noticed that Jim Deeble, who has 94 1 ***Tekbook, which is an Internet connection which 2 is one of the places that allow him an account that 3 gave him access to the Internet, he was having a 4 problem with security, his passwords were being 5 cracked. ***So what if you do remember? What he 6 said was, "I was curious to see what the nature of 7 the problem was. There was a new version of Crack 8 here that I haven't seen how it works." 9 This is something that -- this was a 10 program that he routinely ran and worked as a 11 Systems Administrator in SSD when he was described 12 by Linda Cline the best Systems Administrator that 13 she worked with. Somebody that she could rely on 14 for getting things done if you had a problem and 15 going to for help and seeing that things worked. 16 He said, "Let me see, let's take a 17 look at this program. Let's see how it works." So 18 he made a copy, he looked at the password file from 19 Tekbook. Remember, he had an account that he could 20 look at the password file. He made a copy of it so 21 that he could work it on the program. 22 He found that there were some 23 problems, there were a bunch of passwords that were 24 bad. So what? Is this just curiosity? No, it 25 didn't stop there. What he did was he sent the 95 1 message to say, "Look, you've got a problem with 2 security and let me help you out." And again, it's 3 one of these things that "I help you now, later on 4 if I need help, hopefully you'll do the same for 5 me." 6 So he got the stroke, he got the 7 positive reinforcement that this was a job -- this 8 was an action that was well received. 9 Now, was he driven at this point by 10 greed or motivation to start getting -- "How can I 11 start gathering up all kinds of good stuff for 12 myself?" Maybe some of that is there. Part of it 13 is this drive, this curiosity that he had there. 14 So he said, "Where else can I go 15 that I have access to this password file that I can 16 run this program to see if it works?" The next 17 place was from O'Reilly. Curiously, there those 18 passwords were solid. It wasn't until later on 19 that O'Reilly was notified. But the response was, 20 and you'll recall the testimony was that there was 21 some initial -- Tanya Herlick may not have been 22 happy about it, but Randal Schwartz's account was 23 reinstated. He still had an account there and life 24 went on. 25 But there wasn't -- that didn't tell 96 1 him a lot. So still being curious, he looks at, 2 "Where do I have another account where I have 3 access to I can take a look at this?" And it was 4 Brillig. The fact that John Kent or somebody else 5 overlooked -- that they think there was a mistake 6 in leaving the password on that account is not -- 7 is beside the point. That's a red herring because 8 the issue is what did Randal Schwartz know, what 9 did he think? 10 The standard practice in the 11 industry was if your account is disabled, you know 12 you don't have authority to use it. And he 13 acknowledged that was the case when he logged onto 14 the SSD password file. 15 But here is the interesting thing. 16 Remember about Counts 2 and 3, when we look at the 17 elements of that, authorization, doing this without 18 authorization, that's not an element. That's not 19 something which is an essential part of the proof 20 of Count 2 and Count 3. It may be useful and 21 interesting to you, and in terms of the State's 22 argument trying to suggest that shows Randal 23 Schwartz had a criminal purpose, but the fact that 24 you may say somebody says he wasn't authorized, 25 that's something beside the point in terms of the 97 1 element of the charge. Please keep that in mind. 2 But as far as Brillig goes, it's 3 very clear that Randal Schwartz came back to the 4 SSD section after all his passwords were disabled 5 when he left in the spring. And he had a new 6 project that Herb Mayer talked to you about, one of 7 the computers that he did the key work on was 8 Brillig. There was discussions which led him to 9 believe that there would be follow-up work to do. 10 It was the kind of project that was complicated and 11 typically required follow-up work. 12 Randal copied the key tools, the 13 programs that he used to make that program work, 14 left them on Brillig, left them on Kandinsky, left 15 them through Brillig on his files so they would be 16 available in anticipation of doing the follow-up 17 work. 18 Those programs that we showed you on 19 the exhibit from the logs that John Kent ran up, 20 those weren't there, the programs weren't 21 necessarily there because they were going to 22 provide secret information that he could use for 23 his own benefit. It was there so that if he was 24 called back he could do the job easier and it was 25 available and he expected that. 98 1 So the fact that later on he found 2 the password worked on Brillig is -- that's the 3 evidence that he still had the access to that and 4 it was a valid account. So he looked at the 5 password file and he ran the Crack program on it. 6 Now, this is where we fundamentally 7 disagree with what the State suggests to you this 8 whole case is about. And we -- and this is where 9 we ultimately will leave it to you to decide at 10 that point what were the purposes, because Randal 11 Schwartz said that he ran the program and he saw 12 that Ron B password, ***deacon, a very clearly bad 13 password was cracked. And Randal Schwartz at that 14 point, contrary to the State's theory, took a look 15 at that and said, "Look, is this this guy's 16 password, this is an SSD machine. This is a bad 17 password." 18 Now, on one hand you could say this 19 is an opportunity to -- for me to grab passwords 20 from SSD. He didn't need to do that if he was just 21 looking for a password to give him access, but what 22 it did was it peeked his curiosity and not only 23 peeked his curiosity but peeked his instincts as a 24 Systems Administrator which was if this password is 25 so easily crackable and it's bad, I wonder if it is 99 1 bad and it's exposed the main SSD cluster? 2 But the only way for him to find 3 that out was to log in using Ron B password. He 4 candidly admitted to you on the witness stand that 5 he knew he wasn't authorized to do that. He knew 6 that. "I didn't have an account on that machine." 7 The only way to find out if this password worked 8 was to use it. Was he trying to steal it or steal 9 the passwords? No. He was looking to see if there 10 was a problem here. His curiosity and instincts 11 took over. 12 What did he find? It did log into 13 the main system and he could read the password 14 file. 15 Now, he copied the password file to 16 run it using the Crack program to see how extensive 17 is this problem, and this was for several reasons. 18 Remember, Randal Schwartz testified and told you, 19 "I wasn't sure what I was going to get, but now 20 I've got this information and I got it in a way 21 that I know I really shouldn't have, so if I simply 22 go and say at this point, 'This is what I've done, 23 you have a single password here on Brillig that is 24 cracked,' is anybody going to respond to that or 25 make an issue about that?" Probably not. Some of 100 1 that is confirmed just in the sense of how John 2 Kent is talking about in terms of how overwhelmed 3 the stuff you get and much better if somebody sees 4 a problem with your system, if they come to you 5 with a solution, to say not just that you have a 6 bad password, but what's the solution here and how 7 extensive a problem is that? 8 And so this is what -- the process 9 that started driving Randal Schwartz's actions. 10 "I've got this information, now what can I do with 11 it? What should I do with this?" 12 He knew that he's not -- clearly, 13 this is not where he should be, but if he is going 14 to be the good guy, the guy wearing the white hat, 15 what he told you was, "I needed to make a complete 16 and thorough report, a report that would show here 17 is the problem, here is how I figured it out, here 18 is the database on which we did it," and so he 19 could come into a solution. 20 Now, in a sense, is this out of the 21 blue? Is this just something he's making up? No, 22 it's not, because this is consistent with how 23 things were handled, for instance, at Tandem when 24 he was doing stuff testing security, albeit part of 25 his job there. But when this April Fools joke came 101 1 in and he broke through the security that was 2 supposed to be impregnable, you could not get 3 through, after some initial consternation, after 4 people were a little upset, they recognized, "Okay, 5 tell us how this worked, give us a report." This 6 is what was in his mind. This is what drove him, 7 what motivated him to take the next steps. 8 Now, the State is wrong when it 9 tells you that the fact that he went back into the 10 SSD password file several weeks later and looked at 11 it again it's not only inconsistent with that, but 12 shows that he was going back to try to get more 13 passwords. You're wrong, because when you think 14 logically, you think about what was -- what did he 15 really need to do, what was he trying to do, it 16 doesn't make sense. 17 If Randal Schwartz was trying to 18 just steal passwords, he had them when the first 19 Crack program was run. When we went and logged on 20 the second time, he logged in with passwords that 21 he already had. That showed him -- would have 22 showed him at that point that he knew the passwords 23 were -- the passwords that were cracked were still 24 good. I don't have to get a whole new -- doesn't 25 have to get a whole new password file if at that 102 1 point he sees by doing that that the words that 2 were cracked can work. That argument doesn't make 3 sense. 4 What makes sense is what Randal told 5 you, which was, "I ran the program to see what the 6 data was so I could prepare a report," but it 7 finished up right around October 1st, right after 8 that, and we see from the invoices that on October 9 4, ***he configured Snoopy, the brand new, fastest 10 machine there. 11 Then right after that, he leaves to 12 teach some classes and he's gone for a while. He 13 comes back and now Snoopy is up and running and he 14 still has this information sitting there. And 15 where is it sitting? Remember, now, this is the 16 information that is in his files under password 17 SSD, very cleverly hidden if he's trying to avoid 18 detection. Clearly identified as what it is in. 19 It's in there as password Brillig. It's in there 20 password ORA, showing it was from O'Reilly. It was 21 running under a program named Crack and all under 22 his own name. 23 And where was that running first? 24 On a machine called Wyeth that was sitting on 25 Morrissey's desk. Mark Morrissey is the Systems 103 1 Administrator, is the one checking these machines 2 to see that they are functioning properly and they 3 are written in a way that anybody in that group 4 could read and look at anything on his files. Not 5 a single bit of -- it's a critical fact when it 6 comes to evaluating whether he had any intent to 7 steal anything. 8 There was nothing sneaky about doing 9 it that way. There was nothing surreptitious about 10 it. No effort to master hide that stuff, that's 11 critical. Because you know he has the skill to 12 have hidden anything that he did in that regard if 13 he was trying to steal things. Intel would never 14 have known what hit them and everybody would have 15 agreed on that. Not just our expert, but the Intel 16 people also. 17 So does the fact that it was run 18 twice, is that inconsistent with that? No. In 19 fact, it's consistent and only makes sense in the 20 context of the explanation that Randal gave you, 21 and that was he came back, "I've got to finish this 22 report, now I've got a new machine. I've got the 23 fastest machine around here and let me see how this 24 program runs on the faster machine. I'll get -- 25 I'll log this back in to get the most recent data," 104 1 so that when you make your report, you're doing it 2 only with the best and the most recent data that 3 you've got available so that you can -- "If I'm 4 going to do this, I'm going to do it right." And 5 that's where things started October 21st, and that 6 was the process that stopped running after Mark 7 Morrissey found that this was going on and that 8 brought us to where we are here. 9 Would it have made sense to report 10 this right away when the password program was -- 11 passwords were cracked in the end of September? 12 Certainly in hindsight, being Monday morning 13 quarterbacks, yes, that would have been the better 14 thing to do, to simply call up and say, "Here is 15 the problem, here is what I found, here is the 16 issue, you need to that care of it." 17 But it is perfectly reasonable and 18 understandable for Randal Schwartz to have said, "I 19 want to prepare a full report first because I'm 20 going back to take this to people at SSD who I 21 left, a place where I left on some strained terms, 22 and so if I'm going to have credibility to go back 23 there, I need to have my ducks in a row. I need to 24 have everything -- my facts lined up. And if I 25 want to be able to get some favors or benefit out 105 1 of this, I need to make sure that this was done 2 right so they would appreciate the work that I've 3 done," and these are the purposes. 4 The purposes were mixed. The intent 5 was mixed. Was it the intent to steal these 6 things? No. Randal Schwartz did not need access 7 to the Internet, an account on the Internet, if he 8 was not going to be working at Intel. He had 9 accounts that gave him access to the Internet at 10 O'Reilly. He had an account at Tekbook that gave 11 him access to the Internet. Only made sense if he 12 was going to work at Intel. He only needed access 13 through the machines to get his Intel e-mail if he 14 wanted to stay there and continue working to do his 15 job. 16 So what were his purposes? What 17 were his motives? Well, they are -- they were 18 admittedly mixed, but they were, "I see a problem 19 here. It is a problem with security. I can be the 20 hero. I will solve the problem, and by solving the 21 problem, I will get hopefully some -- we'll get 22 some additional benefits. I will get maybe the 23 opportunity to go back to work at SSD. They will 24 see that, remember me, the guy who told them that 25 the mail system they wanted to set up was not the 106 1 right way to go, that it was backward, that it was 2 just -- the way Lou Poehlitz wanted to do was not 3 the best way and we had a disagreement and they 4 changed things from my way, so I left my way to the 5 one that the entire company has gone? I'm the guy 6 who -- I'm a valuable asset to you. I want to come 7 back and work. And it also would mean whether or 8 not that would happen, maybe I would at least get 9 access to the machines that would allow me the 10 Internet connections," because SSD connection had a 11 separate -- had a separate connection from 12 ***obtaining and that system. We had evidence that 13 Brillig and the SSD machines were running a 14 different network for those purposes than Mink and 15 the Hawthorn Farms computers. 16 Now, were these personal motives? 17 Were these motives to benefit Randal Schwartz? 18 Well, I suppose, you know, yes, but were they 19 motives that were part of his desire to do 20 something valuable and to benefit Intel? The 21 answer to that is also yes. Anybody who does a 22 good job for a place or tries to do something to 23 help out their employer, somebody who expects to 24 get paid, hopes to get recognized and wants 25 advancement and wants to get benefit, that's the 107 1 benefit he was looking for. Not some kind of 2 sinister benefit of sneaking access to computers 3 that he wouldn't have -- that he wouldn't have 4 otherwise. 5 This wasn't -- this wasn't an 6 elaborate plan to be able to gain access to the 7 Internet. That just doesn't make sense and that's 8 not what was going on. 9 The way the State has characterized 10 Randal Schwartz's actions in this case, it's like 11 what Randal Schwartz was doing was trying to 12 find -- that there was a rule and he was trying to 13 find a way around it, when what he was really doing 14 was seeing problems and trying to find a way to 15 solve them. 16 At the risk of repeating myself, I 17 must, I cannot overemphasize to you the importance 18 of the fact that Randal Schwartz, in running the 19 Crack programs, made no effort to hide what he did. 20 That is behavior that you heard was inconsistent 21 with Rich Cower's areas experience of the behavior 22 of somebody trying to secrete or take information 23 out of the workplace. It is inconsistent with 24 Andrew Johnson-Laird's experience with outside 25 computer hackers or people inside companies who are 108 1 trying to steal company assets. 2 Finally, in this regard, what is it 3 that the State is actually saying that was stolen? 4 Passwords and password file containing cracked 5 passwords. 6 You've heard also how Intel had to 7 go through great expense to change these things and 8 to rework things. I would suggest it's an expense 9 that had the line people coming to Randal Schwartz 10 first saying, "What's going here," that would never 11 have occurred. 12 The key point is this: What value 13 is a password that has been cracked? As the State 14 said, it loses its value. But as some of the 15 witnesses, including Intel witnesses told you that 16 crackable passwords, passwords that are bad, that 17 are easily guessed, aren't an asset to the company. 18 It's a liability. 19 Intel had a policy about how to set 20 up passwords. Policy that you don't pick certain 21 kinds of words. Policy that you don't share them 22 with other people like your secretary or your wife 23 or your other people that you work with. A policy 24 that Ed Masi himself didn't follow. Policy that 25 Justin Rattner apparently didn't follow. 109 1 And isn't it ironic that the new 2 version of Crack that Randal Schwartz was testing 3 had a feature which allowed it to check for new 4 twists, like remember talking about the dollar sign 5 for the "S" and some other features, and just the 6 kind of thing that Ed Masi did and the kind of 7 thing that would tell you if you are on top of the 8 security, the way we're doing business now isn't 9 working effectively. 10 Isn't it ironic then that when all 11 of this came up, the person who is in charge of 12 security for at least the six weeks that Randal 13 Schwartz had been running these tests had not 14 checked security. These people who all of a sudden 15 got so upset knew nothing about the problems with 16 their passwords. 17 MR. TINTERA: Objection. There is 18 no evidence of that. 19 THE COURT: Well, after two weeks, I 20 don't remember every bit of evidence or testimony, 21 and frankly, if your recollection, ladies and 22 gentlemen, of the evidence differs from either 23 counsel, disregard what they say because what they 24 say here in argument isn't evidence. 25 Go ahead. 110 1 MR. SUSSMAN: The point is that what 2 Randal Schwartz ultimately was doing was showing 3 people in SSD that and revealed that there was a 4 serious problem that wasn't being addressed. And 5 it was the kind of problem that he was addressing 6 and taking care of and avoided during the time that 7 he was a Systems Administrator there. 8 Ultimately, it's so significant that 9 no information of the password and password file 10 was found anywhere on Mr. Schwartz's machines or in 11 his records and that, remember, didn't need a 12 search warrant to look for cracked passwords or 13 cracked password file when this investigation 14 started out. If that was what they were concerned 15 about, if that's what they wanted to prosecute 16 Randal Schwartz for, didn't need to show up at his 17 house with a search warrant. The evidence was 18 right there. That's not what the case was about. 19 But in order to convince you of this 20 new theory of theft, there has been evidence and 21 there have been things about Mr. Schwartz that have 22 been brought here that would -- I think that have 23 been offered, have been brought up in a way to 24 suggest to you or show to you that this is a person 25 who is always seen perhaps sneaking into things or 111 1 changing his privileges around or doing things in a 2 way that he's not permitted to do. And in several 3 key instances you've been given information like 4 that that were demonstrably false. 5 You were provided with testimony of 6 John Kent of a security incident involving his DEC 7 computer where Randal Schwartz had given himself 8 root privileges on this thing. And when you 9 find -- what we learned from Herb Mayer was this 10 was a tool that was essential to doing the job on 11 the T-A -- I haven't got the pronunciation down 12 yet -- that he was contracted to do. It was not an 13 incident. He spoke to John Kent and it was cleared 14 up. 15 John Kent did not tell you about the 16 conversation with Herb Mayer when he testified, but 17 he left you the impression that Randal Schwartz had 18 been sneaking somehow this root access to this 19 computer and was creating a security incident. 20 Mark Morrissey testified to you that 21 Randal Schwartz had -- after this transition when 22 he took over as the Systems Administrator, that he 23 removed Randal Schwartz's root access to a number 24 of the machines in that group, but then he found 25 out later on that Randal Schwartz had put root -- 112 1 the root privileges back onto the computers. This 2 would have been after sometime in June or July when 3 this transition occurred. 4 But the information we got from the 5 very files that Mark Morrissey preserved that were 6 printed out for us by Intel from those backup tapes 7 showed that the last time that Randal Schwartz 8 worked on that root file that Mark Morrissey was 9 talking about was in December of 1992, six to eight 10 months before Mark Morrissey says this incident 11 happened. This is on Exhibit 155. 12 Our first character witness, Patrick 13 Reilly, talked about Randal working at Motorola and 14 asked whether Randal Schwartz had been terminated 15 from Tektronix and Tandem for security violations. 16 And we know from Lyle Settle that in neither case 17 was he terminated or suspended. Nor has there been 18 any evidence such as records that would show that 19 these incidents actually occurred. 20 You had witnesses who came in here 21 from Intel on direct to tell you that Randal 22 Schwartz was basically terminated from SSD. This 23 was done to suggest that he was fired. And the 24 evidence that we brought out was that there was a 25 disagreement over policy. Randal Schwartz -- 113 1 basically became a mutual thing when Randal 2 Schwartz announced, "I'm leaving." And John Gray 3 told you that he had never communicated to Randal 4 Schwartz that his contract was terminated prior to 5 that time, other than to say, "This would be your 6 last six months as an independent contractor." 7 Similarly, as I mentioned before, 8 there were misimpressions given to you in terms of 9 how far wide open the security at Intel was left by 10 the gate programs and door programs that Randal 11 Schwartz had written. 12 These misimpressions, these 13 misconceptions might be accidental, but they also 14 are not -- they are also consistent with a desire 15 on the part of -- a desire to show Randal Schwartz 16 in a light which would suggest to you without 17 foundation that this is a person who would be 18 breaking into places he shouldn't be to steal 19 things that he didn't -- that he shouldn't be. 20 Wind this down with a couple 21 thoughts to leave you here with. Just before the 22 trial started about a month ago, I had the 23 opportunity to take my kids, my family to 24 Washington, D.C. -- 25 MR. TINTERA: Your Honor, I object 114 1 to any personal rendition to the jury. 2 THE COURT: Well, I think it's 3 probably going to be proper argument. Going to 4 wind up with something involving this -- some sort 5 of illustration. 6 MR. SUSSMAN: It is an illustration. 7 MR. TINTERA: Go ahead. 8 MR. SUSSMAN: Turning around, I 9 happened to be by the Department of Justice in 10 D.C., and over at the Department of Justice, a 11 motto saying -- over the front door saying, "The 12 United States never loses a case when justice is 13 done to one of its citizens." The United States 14 always wins when justice is done with one of its 15 citizens. 16 What does that mean in this case? 17 The State of Oregon, the United States, the 18 government prosecuting an individual, does it mean 19 that it always wins if justice is done by getting a 20 conviction? No. What it means is that we're 21 going -- we're going through a process here, 22 something that we have all gone through together 23 that in a few minutes, a short time, will be left 24 in your hands to make a judgment, to deliberate 25 based on all of information that has been given to 115 1 you, the evidence that you've heard, considering 2 the arguments that we have given to you. And 3 Randal Schwartz, I suppose, in some respects will 4 be in your hands to determine whether or not you 5 are satisfied that the State has proved these 6 charges to you beyond a reasonable doubt. 7 And when he goes through that 8 process, when you have gone through that 9 deliberative process and rendered your judgment, if 10 upon that careful deliberation, if you come to the 11 conclusion that you are satisfied beyond a 12 reasonable doubt, then justice may be done. 13 On the other hand, when you come to 14 that process and you considered that and you see 15 that there is reasonable doubt that Randal Schwartz 16 was aware, consciously aware of -- that he knew 17 that he was not authorized to do certain things, 18 that if you have reasonable doubt that he intended 19 to steal anything from Intel, to appropriate for 20 his own purposes at the expense of Intel password 21 files or a password, you come through that process 22 and have ***written down and return a verdict of 23 not guilty, then justice is done and the United 24 States wins and one of its -- because one of its 25 citizens has been through the process and the 116 1 stigma of an accusation of a criminal offense has 2 been removed. 3 Now, we trust that you will give 4 this case the deliberation that -- the careful 5 deliberation. We have every reason to expect that 6 you will and we have every reason to expect and 7 trust that when you render a verdict, that it will 8 be fair and justice will be done. 9 Thank you. 10 ****(Recess taken.) 11 THE COURT: Proceed, Mr. Tintera. 12 MR. TINTERA: I will be brief. I've 13 had -- I've said most of what I would like to say 14 when I first spoke with you. There is a couple 15 things that I'd like to bring up. 16 This has been likening to a labor 17 dispute between an employer and employee, and look 18 at the situation where perhaps you hire someone to 19 do work in your house, in your garage, and they're 20 doing the work in the house and they have the key 21 to both and, unfortunately for you, as it turns out 22 later, that the key to the garage also they can use 23 to gain access to the key to the house, but they're 24 done in the house. Their contract is over, but 25 they can still come into the garbage and you 117 1 thought you got the key back but you didn't. You 2 forgot about it. 3 So they go back into your garage and 4 they use the key and they go into your house and 5 they go in there and they do whatever. They take 6 things that are proprietary information to you, 7 your checking account number, your Visa card 8 number, your credit card number for the telephone, 9 or maybe just look around. But the point is, you 10 could look at that as a labor dispute, but it's 11 also a criminal act. I mean, a person could fire 12 them, call the police, do either one, so what? 13 That has nothing to do with the facts of this case, 14 absolutely nothing to do with the facts of this 15 case whether it was an employment situation or a 16 person violated the law. It just doesn't have 17 anything to do with it. 18 Counsel has fried to show you 19 State's Exhibit 23, this is the two copying of the 20 SSD password file, once on September 24th and once 21 on October 21st, and says this is no big deal. 22 This is what Mr. Schwartz had in mind all along. 23 The point is, that's not what he 24 told you. He told you, "I copied it once and I was 25 going to do a time trial against it on the new 118 1 machine to see how it did." That's what he said. 2 Why was it important for him to have you believe 3 that he only copied it once? Do you think he 4 didn't know? Did you think he didn't know because 5 he would have had to use somebody's password again 6 to get that file? Do you think he didn't know he 7 did that? 8 That was a breach of trust. You 9 know when you cross the line. You don't forget it. 10 He knew he had done this twice. Why was it 11 important for him to have you believe he had only 12 done it once? Because it fit in with his security 13 excuse for his behavior. The security excuse that 14 is not supported by anything that he did except his 15 word in one portion of his interview with the 16 police is the only time it's supported. Nothing 17 that he did beyond that supports it. 18 He never revealed to the person Ron 19 B that he had a lousy password. That was done and 20 it was testified to by everyone else when they used 21 the Crack program for it to be of any use to the 22 security, he would have to tell the person, unless 23 you're using it for your own particular purposes, 24 then you wouldn't, because that avenue is closed 25 off. 119 1 I submit to you that it's 2 significant that this was copied twice, that Crack 3 was run on it twice, and it's entirely consistent 4 with him updating the passwords. He doesn't have 5 to use them to find out. He recopied the password 6 file and updates it. People are changing it so he 7 can do what? It fits in exactly with what he told 8 Detective Lazenby. "I needed them in case they 9 caught me doing it and knew they would shut me down 10 so I needed the passwords. The more I had, the 11 longer I could continue to do what I wanted to do." 12 That's what he told Detective Lazenby. 13 The thread through what his 14 statements is one, "What I was doing violated Intel 15 policy." He said that to Mr. Cower. He said it to 16 Mr. Lilley. He said it to Mr. Lazenby. 17 Now, do you think honestly now, do 18 you think that they didn't hear that right? I 19 can't ask for a show of hands, but do you think 20 they didn't hear that right? Do you think that 21 when Detective Lilley put in his report 22 "technically illegal" that he didn't get that 23 right? They wrote these reports almost 24 contemporaneous with the interview. 25 Mr. Schwartz readily acknowledged 120 1 that not only was this activity against Intel 2 policy, but there was no doubt in his mind that he 3 could be held criminally liable for it. 4 "I needed them in case they caught 5 me doing it and they would shut me down, so the 6 more passwords I had, the longer I would continue 7 doing what I wanted to do." That's the essence of 8 this case, that Mr. Schwartz wanted to do what he 9 wanted to do, and "Intel be damned, I'm going to do 10 it my way. I don't care if Seth Bradley tells me 11 back in 1991 it is against Intel policy to do 12 that." You need the approval of your superior. 13 That's exactly what happened. 14 But more importantly perhaps, is how 15 did they fix it? They put that access beyond the 16 fire wall. That's how they fixed that particular 17 problem. None of what Mr. Schwartz did later on 18 was beyond the fire wall. It was right through the 19 fire wall. 20 He was told then it was against 21 Intel policy. He was told in March of 1993 it's 22 against Intel policy. He was told in July of 1993, 23 "It is against Intel policy. If you want to do 24 this, you must get security clearance." How much 25 clearer could it possibly be to him? 121 1 Then he takes his arrogance, takes 2 the very same program and places it on Brillig. 3 That's exactly what he did. He was going to do 4 what he wanted to do no matter what. He knew it 5 was against policy. He knew it was illegal and he 6 chose to do it. 7 You have to be a accountable for 8 your actions. You have to maintain accountability 9 for your actions, and that's what I'm asking you to 10 do. Hold him accountable for what he did. 11 The definitions in regard to him 12 committing theft of the password file -- 13 MR. SUSSMAN: Your Honor, I object. 14 This is not rebuttal now. This is repeating the 15 earlier argument. 16 THE COURT: Overruled. Go ahead. 17 MR. TINTERA: Appropriate property 18 of another to oneself, to exercise control of 19 property over another under such circumstances as 20 require the major portion of the economic value or 21 benefit of such property. 22 Deprive property of another. To 23 withhold property of another under such 24 circumstances that the major portion of its 25 economic value or benefit is lost. He did it for 122 1 his own purposes, not Intel purposes. ****(Tom was 2 reading from the definitions of theft and 3 knowingly) 4 That's all I have to say about the 5 facts of the case. The Judge will tell you what 6 the law of the case itself is now. You have to 7 determine the facts and apply them to the law. 8 There is nothing we can do to change 9 what happened in 1993, and that's what we need to 10 look at, what happened back then. Thank you. 11 THE COURT: Ladies and gentlemen of 12 the jury, I'm going to tell you that I will 13 instruct you as to the law now and I am going to 14 tape record the instructions. Many of you have 15 been keeping notes. You should feel free to 16 continue doing that. You will have this tape 17 recording, though, of the instructions, as well as 18 the tape player with you during your deliberation 19 so that if you have a question about what I have 20 told you as to the law, you can listen to it again. 21 There is a concern that we always 22 have when we do this and I need to instruct you as 23 to that. When I give you your recording, if during 24 the deliberation that you have a question about a 25 particular instructions, particular area, that you 123 1 search for that, fast advance or fast reverse and 2 find that particular one and listen to that, then 3 you give extra weight to that and you tend to 4 forget what the other ones were. So if you have a 5 question about a particular instruction that I give 6 you, the way that I'm instructing you or telling 7 you to do that is if you play them again, play them 8 all the way through. 9 If you have a question about a 10 particular one, of course listen in, but listen to 11 the others as well. Otherwise, you may get the 12 wrong impression as to what the law is or make a 13 mistake in the law. 14 There are definitions that I give. 15 There are qualifying or limiting instructions and, 16 frankly, the order in which judges give 17 instructions is almost as important as what we tell 18 you. We try to give them to you in a fashion so 19 that when we instruct you as to elements of an 20 offense or something, then after that, we tell you 21 how certain terms are defined and we go on with any 22 limitations or exception and that sort of thing. 23 Again, so that you don't give undue 24 importance to a particular instruction, if you do 25 want to listen to any of the them again, start at 124 1 the beginning and listen to them all the way 2 through. And I'm telling you that's the way that I 3 want you to do that. 4 Ladies and gentlemen of the jury, it 5 is your sole responsibility to make all of the 6 decisions about the facts in this case. You must 7 evaluate the evidence to determine how reliable or 8 how believable the evidence is. 9 When you make your decisions about 10 the facts, you must then apply the legal rules to 11 those facts to reach your verdict. Remember, 12 however, that your power to reach a verdict is not 13 arbitrary. When I tell you what the law is on a 14 particular subject or tell you how to evaluate 15 certain evidence, you must follow these 16 instructions. 17 You should not allow anything that I 18 have said or done during the course of this trial 19 to suggest that I have formed any opinion about 20 this case. Keep in mind that I am required by law 21 to give certain instructions in every criminal 22 case. 23 Now, when I have sustained an 24 objection to evidence or ordered that evidence be 25 stricken or excluded from your consideration, you 125 1 must follow my rulings. You must not consider such 2 matters during your deliberation. Your verdict 3 should be based only upon the evidence and these 4 instructions. 5 The attorneys' statements and 6 arguments are not evidence. If your recollection 7 of the evidence is different from the attorneys' 8 recollection, then you must rely upon your own 9 memory. 10 In deciding this case, you are to 11 consider all the evidence that you find worthy of 12 belief. It is your duty to weigh the evidence 13 calmly and dispassionately and to decide this case 14 upon its merits. You are not to allow bias, 15 sympathy or prejudice anyplace in your 16 deliberations. You should not decide this case 17 based upon guesswork, conjecture or speculation. 18 Nor should you consider what sentence might be 19 imposed upon the defendant by the Court if he is 20 found guilty. 21 Generally, the testimony of any 22 witness whom you believe is sufficient to prove any 23 fact in dispute. In other words, you are not 24 simply to count the witnesses, but you are to weigh 25 the evidence. 126 1 Keep in mind that each party is 2 entitled to the considered decision of each juror. 3 Therefore, you should not give undue weight to 4 another juror's notes if those notes conflict with 5 your recollection of the evidence. 6 Now, your decision in this case must 7 be based upon the exhibits which were received into 8 evidence and what you recall of the testimony of 9 the witnesses. I will not permit the reporter to 10 read back testimony to you during your 11 deliberations. 12 The term "witness" includes every 13 person who has testified under oath in this case. 14 Every witness has taken an oath to tell the truth. 15 In evaluating each witness' testimony, however, you 16 may consider such things as the manner in which the 17 witness testifies, the nature or quality of the 18 witness' testimony, evidence that contradicts the 19 testimony of the witness, evidence concerning the 20 bias or motive or interest of the witness, and 21 evidence concerning the character of the witness 22 for truthfulness. 23 A witness who lies under oath in 24 some part of his or her testimony is likely to lie 25 in other parts of that witness' testimony. 127 1 Therefore, if you find that a witness has lied in 2 some part of that witness' testimony, then you may 3 distrust the rest of the witness' testimony. 4 Sometimes witnesses who are not 5 lying may give incorrect testimony. They may 6 forget matters or may contradict themselves. Also, 7 different witnesses may observe or remember an 8 event differently. You have the sole 9 responsibility to determine what testimony or 10 portions of testimony that you will or will not 11 rely upon in reaching your verdict. 12 Now, when a witness testifies about 13 statements made by the defendant, you should 14 consider such testimony with caution. In reviewing 15 such testimony, you should consider, among other 16 things, the following: 17 Did the defendant make the 18 statement? And if so, did the defendant clearly 19 express what he intended to say? 20 Did the witness correctly hear and 21 understand what the defendant said? 22 Did the witness correctly remember 23 and relate what the defendant said? 24 Did the witness intentionally or 25 mistakenly alter some of the words used by the 128 1 defendant, thereby changing the meaning of what was 2 actually said? 3 If, after weighing such factors, you 4 conclude that the defendant said what he intended 5 to say and that the witnesses to the statement 6 correctly understood, remembered, and related to 7 you what the defendant said, then you are 8 authorized to consider such statements for what you 9 deem them to be worth. 10 Although a witness may be allowed to 11 state his or her opinion, you are not required to 12 accept that opinion. To determine what value, if 13 any, you will give to a witness' opinion, you 14 should consider such things as the witness' 15 opportunity and ability to form the opinion, the 16 witness' believability, and how the witness reached 17 the opinion. 18 There are people who are permitted 19 to testify we call experts in a particular area, 20 and an expert witness is a person with special 21 skills or education in a particular field. Even 22 though expert witnesses may testify about their 23 opinions, you are not required to accept them. 24 To determine the value, if any, you 25 will give to an expert's opinion, you should 129 1 consider such things as the expert's 2 qualifications, the expert's opportunity and 3 ability to form the opinion, the expert's 4 believability, and how the expert reached the 5 opinion or conclusion. 6 There are two types of evidence. 7 One is direct evidence, such as the testimony of 8 and eyewitness. The other is circumstantial 9 evidence, the proof of a chain of circumstances 10 pointing to the existence or non-existence of a 11 certain fact. You may base your verdict upon 12 direct evidence or circumstantial evidence or upon 13 a combination of both. 14 In deciding this case, you may draw 15 inferences and reach conclusions from the evidence, 16 provided that your inferences and conclusions are 17 reasonable and are based upon your common sense and 18 experience. 19 Now, in this case, the defendant has 20 been charged, and I previously summarized for you 21 the three counts in the indictment that was filed. 22 There has been an indictment filed in charges in 23 Counts 1, 2 and 3 that the defendant in each of 24 those counts has committed a crime called computer 25 crime. I'm going to summarize those for you now. 130 1 In Count 1, it's alleged that the 2 defendant on and between November 1st, 1992, and 3 November 1st, 1993, in Washington County, Oregon, 4 did unlawfully and knowingly and without 5 authorization alter a computer and computer network 6 consisting of Intel computers Mink and Brillig. 7 And in Count 2, it's alleged that 8 the defendant, the same defendant, during the same 9 time period and the same county and same state did 10 unlawfully and knowingly access and use a computer 11 and computer network for the purpose of committing 12 theft of Intel SSD password file. 13 And in Count 3, it's alleged that 14 the defendant, on and between October 21st, 1993, 15 and October 25th, 1993, in Washington County, 16 Oregon, did unlawfully and knowingly access and use 17 a computer and computer system for the purpose of 18 committing theft of Intel SSD individual users' 19 passwords. 20 To each of these counts and to each 21 material element of each of them, the defendant has 22 entered his plea of not guilty. This plea of not 23 guilty is a denial of every material allegation 24 contained in each of those offenses, each of those 25 three counts. 131 1 Now I'm going to instruct you as to 2 the law regarding the elements of each of the 3 offenses as alleged there. Each of them is 4 entitled generally "computer crime," but each of 5 them contains different unique allegations to that 6 particular count, so you'll need to listen 7 carefully. I will tell you, though, that if any of 8 you have ever sat as jurors before, and certainly 9 in listening to these instructions on the three 10 counts, I'll give you the elements that are like 11 necessary ingredients of a recipe, they are all 12 required. 13 The first two are always the same. 14 The first one, if you are keeping notes or trying 15 to remember what they are, always has to do with 16 what we call venue, the county and state where the 17 crime is alleged to have occurred. And the second 18 one always has to do with a date or time period. 19 If you will listen as I go through these, it's the 20 same as what I told you, in other words, what I 21 instruct you on will always be the venue issue, the 22 county and state where the crime is alleged to have 23 occurred, and the second deals with the time 24 period. 25 Generally with regard to computer 132 1 crime, Oregon law provides that a person commits 2 computer crime when a person knowingly and without 3 authorization alters a computer or computer 4 network. In this case, then, to establish computer 5 crime, as alleged in Count 1, the State must prove 6 beyond a reasonable doubt the following elements. 7 There are four material elements here. 8 The first is that the act occurred 9 in Washington County, Oregon. 10 The second is that the act occurred 11 on and between November 1st, 1992, and November 12 1st, 1993. 13 Third, that the defendant knowingly 14 and without authorization, altered a computer or 15 computer network consisting of Intel computers Mink 16 and Brillig. 17 And, fourth, that the defendant 18 engaged in this conduct knowing he was without 19 authorization to do so. 20 Going on to Count 2, which is also 21 an allegation of computer crime, but again it's 22 unique, it's different and distinct from Count 1, 23 here Oregon law provides that a person commits 24 computer crime when a person knowingly accesses or 25 uses a computer or computer system for the purpose 133 1 of committing theft. 2 In this case, then, in Count 2, to 3 establish computer crime, the State must prove 4 beyond a reasonable doubt the following elements. 5 Again, there are four material elements. 6 The first is that the act, if any, 7 occurred in Washington County, Oregon. 8 Number two, the act occurred between 9 August 1st, 1993, and November 1st, 1993. 10 And three, the defendant knowingly 11 accessed or used a computer or computer system for 12 the purpose of; and four, that purpose was for the 13 purpose of committing theft of Intel Supercomputer 14 Division password file. 15 Count 3 is the last allegation, it's 16 also an allegation of computer crime that's unique 17 and distinct to this particular charge in Count 3, 18 and again, Oregon law provides that a person 19 commits computer crime when a person knowingly 20 accesses or uses a computer or computer system for 21 the purpose of committing theft. And in this case 22 and in Count 3, in order to establish the crime of 23 computer crime, the State must prove beyond a 24 reasonable doubt the following elements, four 25 material elements again. 134 1 First, that the act occurred in 2 Washington County, Oregon. 3 Second, that the act occurred 4 between October 21st, 1993, and October 25th, 1993. 5 Third, that the defendant knowingly 6 accessed or used a computer or computer system for 7 the purpose of -- that gets us to the fourth 8 element, the purpose was committing theft of Intel 9 Supercomputer Division individual users' passwords. 10 Now, as I have instructed you for 11 Counts 2 and 3, I've used some terms. In fact, I 12 will give you some definitions now of terms. 13 Remember earlier I said I'd give you definitions? 14 Well, I'm going to do that now. 15 In Counts 2 and 3, I used in both of 16 those, the words or phrases "for the purpose of 17 committing theft." Under the law of this state, as 18 used in those two counts, in Counts 2 and 3, the 19 words "for the purpose of committing theft," that 20 means with the intent of committing theft. That's 21 what that means. That's another way of saying 22 that. 23 In Counts 2 and 3, I used the word 24 "theft" in those instructions, and so you may have 25 some preconceived notion about what you may think 135 1 theft is. I used the words again "for the purpose 2 of committing theft." Well, I need to define 3 "theft" so you know what that means under our law. 4 And under the law of Oregon, a theft occurs when a 5 person takes, appropriates, obtains or withholds 6 property from the owner of the property with the 7 intent either to deprive the owner of the property 8 or to appropriate the property for that person's 9 benefit. 10 When I say that "person's," that 11 means the taker's benefit. 12 Some further definitions need to be 13 given to you. I used some words and phrases here. 14 One of them was "appropriate property of another to 15 oneself." That means, under our law, to exercise 16 control over property of another permanently or for 17 so extended a period or under such circumstance as 18 to acquire the major portion of the economic value 19 or benefit of such property. 20 And I used the phrase "deprive 21 another of property." Under our law, that means to 22 withhold property of another permanently or for so 23 extended a period or under such circumstances that 24 the major portion of its economic value or benefit 25 is lot to him. 136 1 When I use "him" here, that refers 2 to the owner of the property and it's not just 3 unique to a person, it could include a corporation, 4 anyone or any being that's capable of owning 5 property. 6 To clarify that. "Owner" means any 7 person and could include a corporation who has the 8 right to possession of the property superior to 9 that of the taker. 10 "Property" means any article, 11 substance or thing of value including, but not 12 limited to, intangible or tangible personal 13 property. 14 And I have used the word 15 "intentionally" or "with intent" and "knowingly," 16 and these words are defined as follows: 17 A person acts intentionally or with 18 intent when that person acts with a conscious 19 objective either to cause a particular result or to 20 engage in a particular conduct. 21 A person acts knowingly if that 22 person acts with an awareness either that his 23 conduct is of a particular nature or that a 24 particular circumstance exists. **(ck) 25 The defendant in this case is 137 1 innocent unless and until he is proven guilty 2 beyond a reasonable doubt, and the burden is upon 3 the State to prove the guilt of the defendant 4 beyond a reasonable doubt. 5 "Reasonable doubt" means an honest 6 uncertainty as to the guilt of the defendant. 7 Reasonable doubt exists when, after careful and 8 impartial consideration of all of the evidence in 9 the case, you do not feel convinced that the 10 defendant is guilty. 11 Proof beyond a reasonable doubt is 12 such that you would be willing to act upon in the 13 most important of your own affairs. 14 When you return to the jury room, 15 the first thing that you are to do is select one of 16 your members to act as presiding juror. That 17 presiding juror has no greater voting weight than 18 other jurors, but is to preside over your 19 deliberation and be spokesperson for the jury. 20 Then you should deliberate and find your verdict, 21 or more appropriately in this case your verdicts, 22 because there are three separate counts. 23 We have had prepared for your use in 24 this case a form of verdict that is entitled "State 25 of Oregon vs. Randal Lee Schwartz. In the Circuit 138 1 Court of the State of Oregon for the County of 2 Washington," entitled "Verdict," and it reads, "We, 3 the jury, being duly empaneled and sworn to try the 4 above-entitled cause, find as follows," and then 5 each of the three counts is listed there, Count 1, 6 2 and Count 3, with the two options that you have 7 in this case of either guilty or not guilty. 8 And these being criminal charges, 9 each count is a criminal charge, ten or more of 10 your number must agree upon the form of verdict on 11 each count. Whether it be guilty or not guilty, at 12 least ten of your members must agree upon that 13 verdict for that count before you have a verdict 14 and before you're authorized to return a verdict on 15 that count. 16 Each count is a separate charge, as 17 I've said, and each would require a concurrence of 18 at least ten of your members before you could 19 return a guilty verdict or a not guilty verdict. 20 Either way. 21 Once you have deliberated and found 22 your verdict on each of the three counts, there is 23 a place for it to be dated and signed by the person 24 who has been selected as your presiding juror. You 25 will be furnished, during your deliberation with 139 1 the verdict form, the exhibits which were received 2 into evidence in this case and the recorder and the 3 recording of these instructions. Again, I will 4 tell you to follow my instructions on how you may 5 refer to this recording of the jury instructions 6 that I'm making. 7 Again, after you have reached your 8 verdict, ten or more of you agree upon each of the 9 forms of verdict on each count, date it, presiding 10 juror signs it, then ring the buzzer and when Lynda 11 appears, announce to her that you have reached a 12 verdict, then we will reconvene and your verdict 13 will be received. 14 Swear the bailiff. 15 (Bailiff duly sworn.) 16 THE COURT: Here is the verdict 17 form. 18 Mr. ****Merrick, this is where you 19 will be departing from our presence. Before the 20 jury goes, I want to thank you personally. As you 21 know, it is necessary to have alternates take the 22 place of jurors and could have happened in this 23 case, but it didn't, fortunately, but doesn't mean 24 that we think any less of all the time and effort 25 you've put into this case, because it was very 140 1 important to have you here and we all do appreciate 2 that, speaking on behalf of all the parties and the 3 Court. We do appreciate that. But you are excused 4 from further service in this case. 5 Again, thank you for your time and 6 effort. Because of the time you've put in on this, 7 it won't be necessary for you, unless you wish, to 8 serve as a juror during the rest of this term. You 9 need to talk to Lynda and Miss ***Cost mass at this 10 time. You may step down at this time. 11 Remove the jury. 12 (Whereupon, the following 13 proceedings were held in 14 open court, out of the 15 presence of the jury at 16 1:26 p.m.:) 17 THE COURT: Exceptions. 18 Mr. Sussman. 19 MR. SUSSMAN: Your Honor, as I 20 recall in our discussions about "beyond a 21 reasonable doubt" and instructions on the elements, 22 I had requested or indicated that I had wanted the 23 instructions also to include the reference to the 24 fact that the State's burden required them to prove 25 each material element of the crime beyond a 141 1 reasonable doubt. And I may have not caught that, 2 but my recollection was that you were going to say 3 that with respect to your instruction on the 4 indictment, and I do not recall that you gave that 5 instruction. So I would -- if you have not, I 6 would have to take exception to the Court's not 7 doing it. 8 THE COURT: I didn't give it as you 9 requested. That was a special instruction. But 10 when I instruct on the elements of each offense, 11 for instance in Count 1, I gave the one that you 12 had drafted and that's in part, "In this case to 13 establish the crime in Count 1, the State must 14 prove beyond a reasonable doubt the following 15 elements." 16 MR. SUSSMAN: Okay. 17 THE COURT: And in Count 2, 18 basically the same language, "The State must prove 19 beyond a reasonable doubt the following elements in 20 Count 2," and the same thing in Count 3. 2 and 3 21 were the ones drafted by Mr. Tintera. So -- and on 22 each count when I instructed them, I told them 23 that. 24 Anything else, Mr. Sussman? 25 MR. SUSSMAN: No, Your Honor. 142 1 MR. TINTERA: I do except to the 2 Court's not giving Uniform Jury Instruction 800 Sub 3 2 on definition of "conceal." In my mind it's 4 clearly raised by an allegation of theft through 5 the statutory definition of 164.015 Sub 1 and 6 through the facts of this particular case and that 7 it's error not to tell the jury what "conceal" 8 means. 9 THE COURT: Okay. We did talk about 10 that earlier, so I'm not blindsided by that. 11 Rethinking it, I've come to the same conclusion, 12 and that since "conceal" was not a term used in any 13 of the instructions that I gave the jury, it was 14 inappropriate for me to define it for them. 15 Thank you. We're in recess. 16 Counsel need to remain available to so that if the 17 jury has a question or if they reach a verdict we 18 can contact you. If for some reason we haven't 19 contacted you by 5:00 o'clock, check back here and 20 let's all assemble here at 5:00 o'clock and then 21 we'll tell you what plans we may have for providing 22 supper to them and deliberation over the evening. 23 Thank you. 24 (Recess pending verdict.) 25 143 1 THE COURT: I understand the jury 2 has reached a verdict. Bailiff will bring in the 3 jury. 4 (Whereupon, the following 5 proceedings were held in 6 open court, the jury being 7 present, at 4:10 p.m.:) 8 THE COURT: Ladies and gentlemen, 9 have you reached a verdict in this case? 10 JURY FOREPERSON: Yes, we have. 11 THE COURT: Mr. ***Eldridge, you're 12 the presiding juror? 13 JURY FOREPERSON: Yes. 14 THE COURT: Would you hand the 15 verdict form to the bailiff, please of? 16 JURY FOREPERSON: Yes. 17 THE COURT: The verdict form, after 18 the entitlement of court and cause, reads as 19 follows: "We, the jury, being duly impaneled and 20 sworn to try the above-entitled cause, find as 21 follows: Count 1, Computer Crime, guilty. Count 22 2, Computer Crime, guilty. Count 3, Computer 23 Crime, guilty. Dated this 25th day of July, 1995," 24 and signed by Mr. Cameron Eldridge. 25 Mr. Eldridge, did at least ten of 144 1 your number agree upon each form of these verdicts? 2 JURY FOREPERSON: Yes. 3 THE COURT: Do you remember what it 4 was? Was it different on each of the counts? 5 JURY FOREPERSON: Yes, it was. 6 THE COURT: It was at least ten? 7 JURY FOREPERSON: At least ten on 8 all three. 9 THE COURT: You all agree with that? 10 Either counsel wish to examine the 11 verdict form? 12 MR. TINTERA: No, Your Honor. 13 MR. SUSSMAN: No, Your Honor. 14 THE COURT: Ladies and gentlemen of 15 the jury, your verdict is received. We are 16 discharging you from further service in this case. 17 Thank you very much for all the time and effort you 18 put into this case. I know it's a sacrifice when 19 you do this, but it's very important that we have 20 you folks serve as jurors in our trial to people 21 from the community to pass judgment for us, and we 22 appreciate the time and effort that you put into 23 it. 24 Mr. Speck, I know, is two days 25 beyond his vacation. But the weather turned nice 145 1 while you were waiting. 2 Thank you. Remove the jury. 3 (Jury excused.) 4 THE COURT: Does either party wish a 5 presentence report? 6 MR. TINTERA: The State does not, 7 Your Honor. 8 THE COURT: Mr. Sussman. 9 (Discussion off the record 10 between the defendant and 11 Mr. Sussman.) 12 MR. SUSSMAN: No, Your Honor. 13 THE COURT: I don't think in my mind 14 one is necessary, either, so I won't order one. 15 Parties wish to have this set down 16 for sentencing at a later date and time? 17 MR. SUSSMAN: Prefer to have it set 18 at a later time, Your Honor. 19 THE COURT: Lynda is there with the 20 jurors. Why don't I have -- I know at 4:30 it will 21 be hard to get a date and time from Calendaring. I 22 will adjourn. Lynda will be in contact with each 23 of ***you, unless either party has an objection, 24 and we'll set the sentencing date for the future. 25 Is that acceptable? 146 1 MR. TINTERA: Yes. 2 MR. SUSSMAN: Yes. 3 THE COURT: Defendant will continue 4 on his release agreement. 5 Do you think that we can get -- I 6 don't want to sit here for ten minutes. 7 THE BAILIFF: I think we can go 8 ahead and just set the date. 9 THE COURT: Do you anticipate 10 calling witnesses or doing any of that sort of 11 thing? 12 MR. SUSSMAN: I think restitution 13 will be an issue. 14 MR. TINTERA: Yes. 15 THE COURT: It will be. I'd suggest 16 we need at least an hour. 17 MR. TINTERA: That's what I think, 18 Judge. 19 MR. SUSSMAN: Yes. 20 THE COURT: Maybe an hour and a 21 half. It will be in September. Last week of 22 August. 23 MR. TINTERA: My dad is coming in 24 from Ohio the last week of August, first week of 25 September. I don't plan to be in the office. 147 1 THE COURT: Could be after that 2 then? 3 MR. TINTERA: Yes. 4 THE COURT: Lynda. 5 THE CLERK: What about Monday, 6 September 11? 7 THE COURT: It will be set for at 8 least an hour. Restitution will be a big issue. I 9 think maybe an hour and a half, maybe two hours. 10 MR. SUSSMAN: I don't know my 11 schedule at this point, but it sounds all right. 12 THE COURT: Sure. Check your 13 schedule and report back to us tomorrow if that's 14 going to be a problem. If it is, we'll reset it. 15 Defendant needs to be here on that date. 9:00 16 o'clock. 17 Any questions? 18 MR. TINTERA: No, Your Honor. 19 MR. SUSSMAN: Your Honor, 20 Mr. Schwartz is still -- as part of his release, he 21 has been able to travel out of town. 22 THE COURT: I don't have an 23 objection to that. 24 MR. SUSSMAN: Thank you. 25 THE COURT: I'm not hesitant to 148 1 guess that there would not be a problem with him 2 appearing at future stages in the case and I'm sure 3 he would, relatively sure. September 11 at 9:00 4 a.m. 5 Thank you. We're in recess. 6 (Proceedings adjourned.) 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 149 1 STATE OF OREGON ) ) ss. 2 County of Washington ) 3 4 5 I, Frank R. Rosales, CSR, the 6 undersigned, do hereby certify that on the date so 7 stated in the before-captioned matter, I was an 8 Official Court Reporter for the Twentieth Judicial 9 District of the State of Oregon and that as such, I 10 did make a record by means of Stenotype of the 11 before-captioned matter and that the foregoing 12 typewritten transcript, consisting of _______ 13 consecutive pages, is a true and accurate 14 transcript of said proceedings. 15 DATED this ____ day of _______________, 16 1996. 17 18 19 ____________________________ 20 Frank R. Rosales, CSR Official Court Reporter 21 22 23 24 25