Today Cryptome released 122 pages of documents (local mirror plaintext) related to Ross Ulbricht's Silk Road trial which had been sealed due to the ongoing investigation of Carl Mark Force IV. The order to unseal (local mirror) came into effect with his arrest. For what it is worth Preet Bharara's minions can be seen pleading to Judge Forrest that the terminally corrupted Baltimore investigation some how touches their investigation in no way. The full extracted text of the unsealed documents is below:
Case 1:14-cr-00068-KBF Document 227 Filed 03/31/15 Page 1 of 1
U.S. Department of Justice
United States Attorney
Southern District of New York
The Silvio J. Mollo Building
One Saint Andrew’s Plaza
New York, New York 10007
March 31, 2015
By ECF
Hon. Katherine B. Forrest
United States District Judge
Southern District of New York
Daniel Patrick Moynihan U.S. Courthouse
500 Pearl Street
New York, New York 10007
Re:
United States v. Ross William Ulbricht, S1 14 Cr. 68 (KBF)
Dear Judge Forrest:
Yesterday, the Government submitted a letter requesting the unsealing of certain sealed
filings in this matter (the “Sealed Filings”), which the Court so-ordered. Pursuant to the Court’s
order, please find the Sealed Filings attached.
Respectfully,
PREET BHARARA
United States Attorney
By: ______________________________
SERRIN TURNER
TIMOTHY T. HOWARD
Assistant United States Attorneys
Southern District of New York
Cc:
Joshua Dratel, Esq. (by ECF)
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 1 of 121
U.S. Department of Justice
United States Attorney
Southern District of New York
The Silvio J. Mollo Building
One Saint Andrew’s Plaza
New York, New York 10007
TO BE FILED UNDER SEAL
November 21, 2014
By E-mail
Hon. Katherine B. Forrest
United States District Judge
Southern District of New York
Daniel Patrick Moynihan U.S. Courthouse
500 Pearl Street
New York, New York 10007
Re:
United States v. Ross William Ulbricht, 14 Cr. 68 (KBF)
Dear Judge Forrest:
The Government writes respectfully concerning an ongoing federal grand jury
investigation being conducted by the U.S. Attorney’s Office for the Northern District of
California (“USAO-San Francisco”), in conjunction with the Public Integrity Section of the
Criminal Division of the Department of Justice. The subject of the grand jury investigation is a
former Special Agent (“SA”) with the Drug Enforcement Administration (“DEA”), named Carl
Force. In 2012 and 2013, SA Force was involved as an undercover agent in an investigation of
Silk Road conducted by the U.S. Attorney’s Office for the District of Maryland (“USAOBaltimore”). As the Court is aware, USAO-Baltimore has a pending indictment against Ross
Ulbricht, charging Ulbricht with, among other things, soliciting the murder-for-hire of a Silk
Road employee. (See Attachment A.) SA Force is the undercover agent whom Ulbricht
allegedly hired to arrange the murder-for-hire, as described in that indictment. He is now being
investigated by USAO-San Francisco for, among other things, leaking information about USAOBaltimore’s investigation to Ulbricht in exchange for payment, and otherwise corruptly obtaining
proceeds from the Silk Road website and converting them to his personal use.
SA Force played no role in the investigation of Silk Road conducted by the U.S.
Attorney’s Office for the Southern District of New York (“USAO-SDNY,” or “this Office”),
which proceeded on a separate and independent track from the investigation conducted by
USAO-Baltimore. Moreover, the Government does not believe that the ongoing investigation of
SA Force is in any way exculpatory as to Ulbricht or otherwise material to his defense.
However, in an abundance of caution, the Government seeks to disclose the investigation of SA
Force to the defense, and therefore respectfully requests a protective order authorizing the
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 2 of 121
Government to do so pursuant to Federal Rule of Criminal Procedure 6(e)(3)(E) and prohibiting
the defense from disclosing the investigation to any third-party.
Facts
SA Force is being investigated by USAO-San Francisco for a variety of conduct,
including suspected misconduct undertaken in his capacity as a DEA undercover agent in
USAO-Baltimore’s Silk Road investigation. USAO-San Francisco began investigating SA Force
in the spring of this year after learning of suspicious transactions he had had with a certain
Bitcoin exchange company with a presence in San Francisco. Further investigation by USAOSan Francisco revealed that SA Force held accounts at multiple Bitcoin exchange companies in
his own name, through which he had exchanged hundreds of thousands of dollars’ worth of
Bitcoins for U.S. currency during 2013 and 2014 and transferred the funds into personal financial
accounts. USAO-San Francisco also learned that SA Force had used his position as a DEA agent
to protect these funds, including sending out an unauthorized administrative subpoena to one of
the Bitcoin exchange companies, purporting to instruct the company to unfreeze an account held
in SA Force’s name that the company had frozen due to suspicious activity.
Since learning this information, USAO-San Francisco has been investigating, among
other things, how SA Force could have come into possession of such a large quantity of Bitcoins
and the extent to which he may have acquired these Bitcoins through his involvement in USAOBaltimore’s Silk Road investigation. This Office has been assisting USAO-San Francisco with
its investigation, by sharing relevant evidence collected from this Office’s investigation of Silk
Road, including evidence from the server used to host the Silk Road website (the “Silk Road
Server”) and evidence from Ulbricht’s laptop computer. To date, USAO-San Francisco’s
investigation has uncovered several possibilities as to how SA Force could have acquired a large
amount of Bitcoins through his involvement in USAO-Baltimore’s Silk Road investigation.
1.
Leaks of Investigative Information in Exchange for Payment
As discussed further below, SA Force operated an authorized undercover account on Silk
Road under the username “nob,” which was involved in the murder-for-hire alleged in the
USAO-Baltimore indictment. However, USAO-San Francisco now suspects SA Force of also
operating at least two other accounts on Silk Road, which were not authorized undercover
accounts. These accounts appear to have been used to leak (or offer to leak) investigative
information to Ulbricht (whom SA Force knew only by his Silk Road username, “Dread Pirate
Roberts”), in exchange for payment in Bitcoin.
One of these accounts is the Silk Road username “french maid.” Evidence from the Silk
Road Server and Ulbricht’s laptop indicates that, in or about mid-September 2013, a Silk Road
user named “french maid” contacted “Dread Pirate Roberts” via Silk Road’s private message
system, claiming that “mark karpeles” had given the true name of “Dread Pirate Roberts” to
“DHLS.” Mark Karpeles is the former CEO of a now-defunct Bitcoin exchange company
known as “Mt. Gox,” whom USAO-Baltimore was seeking to interview in September 2013 to
determine if he had any information concerning the identity of the Silk Road operator “Dread
Pirate Roberts.” “DHLS” is a possible reference to the Department of Homeland Security,
2
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 3 of 121
agents of which were working with USAO-Baltimore’s investigation. Evidence from Ulbricht’s
laptop indicates that Ulbricht paid “french maid” $100,000 in Bitcoins to pass on the name that
Karpeles had supposedly given to authorities, but that “french maid” never replied.1 Given
“french maid’s” use of SA Force’s first name and apparent knowledge of the USAO-Baltimore
investigation with which he was involved, USAO-San Francisco is investigating whether the
“french maid” account was controlled by Force and used to corruptly obtain this $100,000
payment from Ulbricht.
SA Force is also being investigated for leaking investigative information to Ulbricht
through a different Silk Road username – “alpacino” (or “albertpacino” or “pacino”). A file
recovered from Ulbricht’s laptop titled “le_counter_intel” (i.e., “law enforcement counter
intelligence”) contains extensive records of communications that appear under the heading
“correspondence with alpacino.” The communications purport to be from someone claiming to
be “in the perfect spot to play spy for Silk Road with the DEA.” Like the correspondence from
“french maid,” these communications reflect inside knowledge of USAO-Baltimore’s
investigation of Silk Road. Further evidence indicates that Ulbricht paid “alpacino” a salary of
$500 per week to supply such information. Accordingly, USAO-San Francisco is investigating
whether SA Force controlled this username as well and exploited it to exchange investigative
information to Ulbricht for payment in Bitcoins.2
2.
Use of Cooperator’s Silk Road Account to Steal Bitcoins from Silk Road
SA Force is also being investigated concerning a theft of $350,000 in Bitcoins that appear
to have been taken from Silk Road through the account of a Silk Road employee – the same
employee at issue in the murder-for-hire allegations charged by USAO-Baltimore. The
employee, Curtis Green, who went by the username “Flush” on Silk Road, was a cooperator in
USAO-Baltimore’s investigation at the time, and his handler was SA Force. Green was arrested
by SA Force and several other agents involved in the USAO-Baltimore investigation on January
17, 2013. Green cooperated with the investigation following his arrest and turned over his login
credentials to the “Flush” account to SA Force. According to DEA investigative reports filed by
SA Force, SA Force initially changed the password on the “Flush” account; however, the reports
state that, on or about January 19, 2013, he gave Green the changed password, so that Green
could log in to the account and resume communications with “Dread Pirate Roberts” for the
purpose of acting as a confidential source.3
1
Ulbricht’s name was not in fact given by Mark Karpeles to any investigators associated with
USAO-Baltimore’s investigation.
2
Silk Road employees are known to have been paid in Bitcoin.
3
All of this information has already been disclosed to the defense, as SA Force’s investigative
reports were turned over in discovery pursuant to Rule 16(a)(1), given that they contain
numerous recorded statements by the defendant.
3
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 4 of 121
Approximately one week later, on January 26, 2013, the “Flush” account appears to have
been used to steal approximately $350,000 in Bitcoins from Silk Road.4 “Dread Pirate Roberts”
messaged “Flush” on January 26, 2013, accusing him of stealing the money and warning that he
was “taking appropriate action.” Subsequent private messages from the Silk Road Server and
chats recovered from Ulbricht’s computer reflect that Ulbricht subsequently recruited a Silk
Road user he knew as “nob” to have Green killed in retaliation for the theft. The “nob” account,
as noted above, was an undercover account controlled by SA Force. SA Force had been using
the account to communicate with “Dread Pirate Roberts,” posing as a large-scale drug dealer
seeking to do business on Silk Road. As reflected in USAO-Baltimore’s indictment, after being
solicited to arrange Green’s murder, SA Force continued communicating with “Dread Pirate
Roberts” about what he wanted done and eventually staged Green’s murder to prove that the
murder was carried out, for which “Dread Pirate Roberts” paid $80,000.
SA Force’s use of the “nob” account for this purpose was part of an authorized law
enforcement operation and his communications with “Dread Pirate Roberts” about the murderfor-hire – which have already been disclosed to the defense – are not suspected of being
improper. Moreover, the receipt of the $80,000 payment for the murder-for-hire is documented
in SA Force’s reports. However, the apparent theft of $350,000 from Silk Road through the use
of the Green’s “Flush” account remains unaccounted for. Given that SA Force had the login
credentials to the “Flush” account at the time, he is under investigation for using the account to
steal the funds.5 Although these funds were criminal proceeds and thus would have been subject
to seizure by law enforcement, USAO-San Francisco is investigating whether SA Force took the
funds without proper authorization and unlawfully converted them to his own personal use.
3.
Receipt of Additional Undocumented Payments from “Dread Pirate Roberts”
SA Force continued to use the “nob” account to communicate with “Dread Pirate
Roberts” through September 2013, and USAO-San Francisco is investigating whether he used
the “nob” account to receive any payments that are not documented in his investigative reports
filed with the DEA. In particular, the Silk Road Server contains private messages sent by “Dread
Pirate Roberts” to “nob” in the summer of 2013, referencing two transfers of Bitcoins made by
“Dread Pirate Roberts” to “nob” during this time period – totaling 400 Bitcoins and 525 Bitcoins,
respectively (equivalent to approximately $85,000 altogether at then-prevailing exchange rates).
However, the receipt or seizure of these Bitcoins does not appear to be reflected in SA Force’s
4
As a Silk Road administrator, “Flush” had administrative privileges on the Silk Road website
that gave him certain effective access to user funds, such as the ability to reset user passwords
and thereby take over user accounts.
5
According to an investigative report filed by SA Force, Green claimed not to know anything
about the theft. The report states: “GREEN has telephoned SA Force on numerous occasions
and advised that he has been ‘racking his brain’ about the supposed theft of $350,000 from
DREAD PIRATE ROBERTS. Note, DREAD PIRATE ROBERTS is accusing GREEN of
stealing the money. GREEN believes that there is a glitch in the website and that somebody
hacked into the SILK ROAD marketplace and stole the Bitcoin.”
4
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 5 of 121
reports. Accordingly, USAO-San Francisco is investigating whether he wrongfully used the
“nob” account to acquire these Bitcoins as well and convert them to his personal use.
Discussion
Federal Rule of Criminal Procedure 6(e) generally prohibits an attorney for the
Government from disclosing any “matter occurring before the grand jury.” Fed. R. Crim. P.
6(e)(2)(B). The Supreme Court has explained that grand jury secrecy is justified, among other
reasons, by the need to protect the integrity of an ongoing investigation and to prevent premature
public disclosure of the fact that an individual is suspected of criminal wrongdoing. See Procter
& Gamble Co., 356 U.S. at 681 n. 6. However, the secrecy requirement of Rule 6(e) is not
absolute. In particular, the rule provides that a court “may authorize disclosure – at a time, in a
manner, and subject to any other conditions that it directs – of a grand jury matter . . .
preliminarily to or in connection with a judicial proceeding.” Fed. R. Crim. P. 6(e)(3)(E).
Disclosure is permissible under this exception if a court presiding over a judicial proceeding
determines that “a particularized need for disclosure outweigh[s] the interest in continued grand
jury secrecy.” Douglas Oil Co. of Cal. v. Petrol Stops Nw., 441 U.S. 211, 223 (1979).
Here, the Government seeks to disclose to the defense the facts set forth above
concerning the pending grand jury investigation of SA Force, under a protective order that
addresses the need to otherwise keep the investigation confidential. The Government therefore
requests that the Court enter a protective order authorizing the Government to make this
disclosure under Rule 6(e)(3)(E) and precluding the defense from disclosing the existence of
USAO-San Francisco’s investigation to any third-party.
To be clear, the Government does not believe that this disclosure is required under Rule
16 of the Federal Rules of Criminal Procedure or under Brady v. Maryland, 373 U.S. 83 (1963).
The suspected criminal conduct for which SA Force is being investigated – even if he did in fact
commit the conduct – does not exculpate Ulbricht in any way or otherwise materially aid his
defense. To the contrary, the suspected leaks of investigative information by SA Force indicate
that Ulbricht repeatedly paid a government agent to provide “counter-intelligence” information
in the interest of protecting Silk Road from law enforcement. Likewise, regardless of whether
SA Force or someone else stole $350,000 through the “Flush” account in January 2013, the facts
remain that Ulbricht believed that his employee, Curtis Green, had stolen the funds, and that
Ulbricht sought to murder Green for doing so. Finally, any personal use of payments that SA
Force received through his undercover “nob” account reflects only corruption on SA Force’s
part, rather than anything suggestive of Ulbricht’s innocence.
Moreover, SA Force played no role in this Office’s investigation of Silk Road and the
Government does not intend to call SA Force as a witness at trial. Thus, the facts underlying the
USAO-San Francisco investigation do not constitute impeachment material for which disclosure
would be required under Giglio v. United States, 405 U.S. 150 (1972). Nor does the Government
intend to use at trial any communications between Ulbricht and SA Force that were found on the
Silk Road Server and Ulbricht’s laptop – even though these communications include highly
5
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 6 of 121
incriminating exchanges reflecting Ulbricht’s hiring of “nob” to arrange the murder of Curtis
Green.6
Although not exculpatory or impeachment material, in an abundance of caution, the
Government seeks to disclose USAO-San Francisco’s investigation of SA Force to the defense in
order to avoid any dispute concerning whether this information is subject to discovery. Even
though the disclosure relates to an ongoing grand jury investigation, the Government believes
that, with the entry of a protective order prohibiting further disclosure, the disclosure will be
sufficiently limited so as to avoid impinging on any interests protected by Rule 6(e), and that the
disclosure is therefore permissible under Rule 6(e)(3)(E). This Office has consulted with USAOSan Francisco, which consents to the proposed disclosure under the requested protective order.
Conclusion
For the reasons set forth above, the Government respectfully requests that the Court enter
a protective order authorizing the Government to disclose to the defense the facts set forth in this
letter and prohibiting the defense from disclosing the existence of USAO-San Francisco’s
investigation of SA Force to anyone outside the defense team. The Government further
respectfully requests that the protective order, and this letter, be maintained under seal.
Respectfully,
PREET BHARARA
United States Attorney
By: ______________________________
SERRIN TURNER
Assistant United States Attorneys
Southern District of New York
Encl.
6
The Government does intend to introduce other evidence of this attempted murder-for-hire,
through communications that Ulbricht had about it with co-conspirators.
6
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 7 of 121
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
UNITED STATES OF AMERICA
– v. –
UNDER SEAL
ROSS WILLIAM ULBRICHT,
a/k/a “Dread Pirate Roberts,”
a/k/a “DPR,”
a/k/a “Silk Road,”
14 Cr. 68 (KBF)
Defendant.
ORDER
Upon the attached letter from Serrin Turner, Assistant United States Attorney for the
Southern District of New York, dated November 21, 2014 (the “Letter”), IT IS HEREBY
ORDERED as follows:
1.
Pursuant to Rule 6(e)(3)(E) of the Federal Rules of Criminal Procedure, the
Government may disclose to the defense the existence of the grand jury
investigation referenced in the Letter.
2.
Pursuant to Rule 16(d)(1) of the Federal Rules of Criminal Procedure, the defense
is prohibited from disclosing the grand jury investigation referenced in the Letter
to anyone outside the defense team.
3.
The Letter and this Order shall be sealed until such time as the Court otherwise
directs.
Dated: New York, New York
November ___, 2014
_____________________________________
HON. KATHERINE B. FORREST
UNITED STATES DISTRICT JUDGE
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 8 of 121
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
UNITED STATES OF AMERICA
UNDER SEAL
-v. –
14 Cr. 68 (KBF)
ROSS WILLIAM ULBRICHT,
a/k/a "Dread Pirate Roberts,"
a/k/a "DPR,"
a/k/a "Silk Road,"
Defendant.
————————————————————————————————————————'
ORDER
Upon the attached letter from Serrin Turner, Assistant United States Attorney for the
Southern District of New York, dated November 21, 2014 (the "Letter"), IT IS HEREBY
ORDERED as follows:
1.
Pursuant to Rule 6(e)(3)(E) of the Federal Rules of Criminal Procedure, the
Government may disclose to the defense the existence of the grand jury
investigation referenced in the Letter.
2.
Pursuant to Rule 16(d)(l) of the Federal Rules of Criminal Procedure, the defense
is prohibited from disclosing the grand jury investigation referenced in the Letter
to anyone outside the defense team.
3.
The Letter and this Order shall be sealed until such time as the Court otherwise
directs.
Dated: New York, New York
NQve~91#'"_, iW-1.4– _,__,
'\)"'~k IJ '2A l 'f
HON. KATHERINE B. FORREST
UNITED STATES DISTRICT JUDGE
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 9 of 121
LAW OFFICES OF
JOSHUA L. DRATEL, P.C.
A PROFESSIONAL CORPORATION
29BROADWAY
Suite 1412
NEW YORK, NEW YORK 10006
TELEPHONE (212) 732-0707
FACSIMILE (212) 571-3792
E-MAIL: JDratel@JoshuaDratel.com
JOSHUA L. DRATEL
STEVEN WRIGHT
Office Manager
LINDSAY A. LEWIS
WHITNEY G. SCHLIMBACH
December 3, 2014
BY ELECTRONIC MAIL
FILED UNDER SEAL
,—··–:.;;:··-=-======-===-=·-::.;-:..:..·: :.;-· ·;.;. ·-·-·,
USDC
The Honorable Katherine B. Forrest
United States District Judge
Southern District of New York
United States Courthouse
500 Pearl Street
New York, New York 10007
Re:
SD~Y
DOCUMENT
ELECTRONICALLY FILED
DOC#: _ _ _ _ _._ __
!DATE FJLED:]£C_Q_!2014
i.::-··
United States v. Ross Ulbricht
14 Cr. 68 (KBF)
Dear Judge Forrest:
This letter is submitted under seal on behalf of defendant Ross Ulbricht, whom I
represent in the above-entitled case, respectfully requesting an extension until Tuesday,
December 9, 2014, for the filing of Mr. Ulbricht's motions in limine, which are currently due
today, December 3, 2014. Assistant United States Attorney Serrin Turner has informed my
associate, Lindsay A. Lewis, Esq., that the government consents to this request so long as the
Court grants a corresponding extension for the government's motions in limine. The letter is filed
under seal at the government's request because it references the government's sealed letter
pursuant to Rule 6(e), Fed.R.Crim.P.
The requested extension is necessary in light of the government's recent sealed letter to
counsel, which raises additional issues that are appropriately addressed in Mr. Ulbricht's
motions in limine, and, in fact, materially affect the motions counsel intended to make. Also,
because the deadline for notice of the government's exhibits was changed to today, time will be
needed to review these exhibits prior to the filing of Mr. Ulbricht's motions in order to determine
whether those exhibits provide a basis for further motions in limine not previously anticipated by
counsel, or possibly obviate the need to make other such motions.
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 10 of 121
Hon. Katherine B. Forrest
United States District Judge
Southern District of New York
December 3, 2014
Page 2of2
LAW OFFICES OF
JOSHUA L. DRATEL, P.C.
In addition, the proposed changes in the motion schedule, which would also push back
the due date for motion responses by the parties to December 16, 2014, will compress the
Court's time for consideration of the motions in limine prior to the final pre-trial conference,
currently scheduled for Wednesday, December 17, 2014, at 2 p.m. The parties are of course
available if the Court wishes to adjust the date of that conference.
Accordingly, it is respectfully requested that the Court grant an extension until Tuesday,
December 9, 2014, for the filing of Mr. Ulbricht's motions in limine. As noted, the government
consents to this application so long as the Court grants a corresponding extension in regard to the
government's motions in limine.
Respectfully submitted,
~~f~
Joshua L. Dratel
JLD/lal
cc:
Serrin Turner
Timothy Howard
Assistant United States Attorneys
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Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 11 of 121
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
——————————————————X
UNITED STATES OF AMERICA
– against ROSS ULBRICHT,
:
14 Cr. 68 (KBF)
:
(Electronically Filed)
:
Defendant.
:
——————————————————X
MEMORANDUM OF LAW IN SUPPORT OF
DEFENDANT ROSS ULBRICHT’S MOTIONS IN LIMINE
JOSHUA L. DRATEL, P.C.
29 Broadway, Suite 1412
New York, New York 10006
(212) 732-0707
JOSHUA J. HOROWITZ, ESQ.
225 Broadway, Suite 1804
New York, New York 10007
(845) 667-4451
Attorneys for Defendant Ross Ulbricht
– Of Counsel –
Joshua L. Dratel
Lindsay A. Lewis
Whitney G. Schlimbach
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 12 of 121
TABLE OF CONTENTS
Table of Contents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . i
Table of Authorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iv
Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Statement of the Facts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
ARGUMENT
POINT I
CERTAIN GOVERNMENT EXHIBITS SHOULD BE
PRECLUDED BECAUSE THEY CONSTITUTE
INADMISSIBLE HEARSAY, AND/OR DO NOT QUALIFY
AS CO-CONSPIRATOR STATEMENTS OR UNDER ANY
OTHER HEARSAY EXCEPTION, BECAUSE EVIDENCE
OF HUNDREDS OF THOUSANDS OF TRANSACTIONS
BETWEEN THOUSANDS OF ANONYMOUS USERS OF
THE SILK ROAD WEB SITE AT MOST ESTABLISHES
MULTIPLE DISCRETE CONSPIRACIES, RATHER THAN THE
SINGLE UNITARY CONSPIRACY CHARGED IN THE INDICTMENT . . . . . . . . . . . . . . . . 3
A.
As a Threshold Matter, Venue Has Not Been Established In the Southern
District of New York for the Multiple Conspiracies Alleged Against Mr. Ulbricht . . . . . 4
B.
The Conduct Alleged Does Not Fall Within the Scope of the Single Charged Conspiracy
and Is Thus Inadmissible As Irrelevant Pursuant to Rules 401 and 402 . . . . . . . . . . . . . . 6
C.
The Admission of the Evidence and Government Exhibits Would Be
Unfairly Prejudicial to Mr. Ulbricht, Pursuant to Rule 403, Fed.R.Evid. . . . . . . . . . . . . 7
POINT II
ANY AND ALL EVIDENCE AND/OR REFERENCES
TO THE “MURDER-FOR-HIRE” ALLEGATIONS
SHOULD BE PRECLUDED AT TRIAL, AND ANY
AND ALL SUCH LANGUAGE SHOULD BE STRICKEN
FROM THE SUPERSEDING INDICTMENT, BECAUSE
THEY ARE NOT RELEVANT TO THE CHARGED OFFENSES
AND/OR, UNDER RULE 403, FED.R.EVID., THEIR UNFAIR
PREJUDICIAL EFFECT SUBSTANTIALLY OUTWEIGHS
i
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 13 of 121
ANY PROBATIVE VALUE THEY MIGHT POSSESS. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
A.
The Applicable Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
B.
Any and All References to the “Murder-For-Hire” Allegations Should Be
Precluded At Trial, And Stricken from the Superseding Indictment As Surplusage,
Because They Are Irrelevant to the Charged Offenses and Unduly Prejudicial . . . . . . . 11
1.
2.
The “Murder-For-Hire” Allegations Should Be
Excluded Because They Are Irrelevant to the Charges . . . . . . . . . . . . . . . . . . . . 12
The “Murder-For-Hire” Allegations Should Be Excluded
Because They Are Unduly Prejudicial Pursuant to
Rule 403, Fed.R.Evid., As Any Probative Value Is Vastly
Outweighed by Their Extraordinary Danger of Unfair Prejudice . . . . . . . . . . . 14
POINT III
CERTAIN GOVERNMENT EXHIBITS SHOULD
BE PRECLUDED BECAUSE THEY ARE NOT
SUFFICIENTLY AUTHENTICATED PURSUANT
TO RULE 901, FED.R.EVID., AND RECENT CASE LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
A.
The Applicable Law Regarding Authentication Under Rule 901 . . . . . . . . . . . . . . . . . . 16
B.
The Facts and Opinion In Vayner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
C.
Vayner’s Application to the Government’s Proposed Exhibits In This Case . . . . . . . . . 20
POINT IV
CERTAIN EVIDENCE AND GOVERNMENT EXHIBITS
ALLEGING PURCHASE OF FALSE IDENTIFICATION
DOCUMENTS SHOULD BE PRECLUDED BECAUSE THEY ARE
NOT REASONABLY DEMONSTRATIVE OF “CONSCIOUSNESS
OF GUILT,” AND/OR THEIR PROBATIVE VALUE, IF ANY,
IS SUBSTANTIALLY OUTWEIGHED BY THE DANGER OF
UNFAIR PREJUDICE TO MR. ULBRICHT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
A.
The Law Applicable to Admissibility of “Consciousness of Guilt” Evidence . . . . . . . . . 21
B.
Mr. Ulbricht’s Alleged Purchase of False Identification
Documents from the Silk Road Web Site Is Insufficient to
Reasonably Infer His Consciousness of Guilt of the Crimes Charged . . . . . . . . . . . . . . 23
ii
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 14 of 121
C.
Alternatively, Evidence of the Alleged Ordering of False Identification Documents Must
Be Excluded Under Rule 403 As Substantially More Prejudicial Than Probative . . . . . 24
POINT V
THE GOVERNMENT’S NOVEMBER 21, 2014, LETTER
SHOULD BE UNSEALED, AND THE INFORMATION
AND EVIDENCE THEREIN SHOULD BE ADMISSIBLE
AT TRIAL BECAUSE IT IS RELEVANT AND EXCULPATORY,
THEREBY ESTABLISHING A COMPELLING NEED FOR UNSEALING . . . . . . . . . . . . . . 25
A.
The Government’s November 21, 2014, Letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
B.
The Principles Applicable to Exculpatory Material and Information . . . . . . . . . . . . . . . 27
C.
Evidence Related to the Investigation of Misconduct by Former SA Force
During the Silk Road Investigation Is Both Material and Favorable to Mr. Ulbricht . . 28
D.
The Evidence Related to the Investigation of Former SA Force
Should Be Unsealed Because It Constitutes Brady Material, Thus
Providing a Compelling and Particularized Need for Its Disclosure . . . . . . . . . . . . . . . 29
POINT VI
OTHER OBJECTIONS TO THE GOVERNMENT’S
PROPOSED EXHIBITS NOT COVERED ABOVE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
Conclusion . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
iii
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 15 of 121
POINT V
THE GOVERNMENT’S NOVEMBER 21, 2014, LETTER
SHOULD BE UNSEALED, AND THE INFORMATION AND
EVIDENCE THEREIN SHOULD BE ADMISSIBLE AT TRIAL
BECAUSE IT IS RELEVANT AND EXCULPATORY, THEREBY
ESTABLISHING A COMPELLING NEED FOR UNSEALING
In its November 21, 2014, letter to the Court, and subsequently provided to defense
counsel December 3, 2014, the government disclosed an ongoing investigation of Carl Force, a
former Special Agent with the Drug Enforcement Administration (“DEA”). The investigation
has thus far revealed that former SA Force allegedly used his position as a DEA agent for selfgain by leaking investigative information to the operator of Silk Road in exchange for payment,
and hijacking a cooperating witness’s Silk Road account to obtain $350,000 in Bitcoins.
The government submitted its letter, and provided a copy to defense counsel, pursuant to
Rule 6(e), Fed.R.Crim.P., and sought and obtained in that context an Order, dated December 3,
2104, maintaining under seal the letter and the information provided therein.
However, for the reasons set forth below, and in the ex parte letter provided
contemporaneously with theses motions, it is respectfully submitted that the information in the
government’s November 21, 2014, letter, is exculpatory, and should therefore be unsealed,
available to the defense to perform a complete investigation, and admissible at trial.
A.
The Government’s November 21, 2014, Letter
In its November 21, 2014, letter, at 1, the government informed the Court that former SA
Force “is the undercover agent whom Ulbricht allegedly hired to arrange the murder-for-hire, as
described in that indictment[,]” and that former SA Force “is now being investigated by USAOSan Francisco for, among other things, leaking information about USAO-Baltimore’s
25
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 16 of 121
investigation to Ulbricht in exchange for payment, and otherwise corruptly obtaining proceeds
from the Silk Road website and converting them to his personal use.”
The government’s letter, at 2, adds that “USAO San Francisco first began investigation
former SA Force in the Spring of 2014[,]” yet the information about the investigation was not
disclosed to the defense in this case until December 3, 2014, essentially one month prior to trial.
The government, in its letter, at 1, claims that it “does not believe that the ongoing investigation
of SA Force is in any way exculpatory as to Ulbricht or otherwise material to his defense[,]”
it has now disclosed the information “in an abundance of caution[.]”
However, that is simply a tacit admission that the government itself recognizes the
potentially exculpatory value of the information, even if it not capable of articulating it either to
the Court or even itself [and that continued withholding of the information would be contrary to
the government’s obligations under Brady v. Maryland, 373 U.S. 83 (1963)]. Nevertheless, as
detailed in the accompanying ex parte letter, the relevant and exculpatory character of the
information is abundantly clear to defense counsel.
Also, while the government, in its letter, at 1, asserts that former SA Force “played no
role” in SDNY’s investigation of Silk Road, the connection is obvious and inescapable from the
fact that the government, in its letter, at 2, admits that SDNY “has been assisting USAO-San
Francisco with its investigation, by sharing relevant evidence collected from this Office’s
investigation of Silk Road, including evidence from the server used to host the Silk Road website
(the “Silk Road Server”) and evidence from Ulbricht’s laptop computer.”
26
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B.
The Principles Applicable to Exculpatory Material and Information
Given the nature of former SA Force’s alleged misconduct during the investigation of the
Silk Road web site, evidence related to that investigation must be unsealed and disclosed to the
defense in order to afford Mr. Ulbricht Due Process and satisfy Brady v. Maryland, 373 U.S. 83
(1963), and its progeny.
Brady and a series of subsequent cases impose an affirmative duty on the government to
disclose all evidence which is material and favorable to the defendant, either because it is
exculpatory or as impeachment material, in compliance with the due process clause of the Fifth
Amendment. Brady v. Maryland, 373 U.S. 83 (1963) (“evidence is material either to guilt or
punishment, irrespective of the good faith or bad faith of the prosecution”); see also Giglio v.
United States, 405 U.S. 150, 154 (1972) (if the reliability of a witness “‘may well be
determinative of guilt or innocence,’ nondisclosure of evidence affecting credibility falls within
this general rule” of disclosure).
Contrary to the government’s claims, the evidence is both material and potentially
exculpatory, and consequently must be disclosed under Brady. Furthermore, the due process
right to Brady material in a manner that allows effective use of exculpatory evidence, certainly
establishes a compelling and particularized need to modify the protective order to permit a
defense investigation, as well as use of admissible evidence at trial. See e.g., Martindell v. Int'l
Tel. & Tel. Corp., 594 F.2d 291, 296 (2d Cir. 1979); see also Dennis v. United States, 384 U.S.
855, 868 (1966).
27
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 18 of 121
C.
Evidence Related to the Investigation of Misconduct by Former SA Force
During the Silk Road Investigation Is Both Material and Favorable to Mr. Ulbricht
In the retrospective context, evidence must be disclosed pursuant to Brady when there is
a “reasonable probability . . . that the outcome would have been different if disclosure had been
made.” United States v. Coppa, 267 F.3d 132, 142 (2d Cir. 2001). A reasonable probability of a
different outcome “is not a sufficiency of evidence test,” and thus, does not require that the
“evidence would have rendered the evidence as a whole insufficient to support a conviction.”
United States v. Payne, 63 F.3d 1200, 1209 (2d Cir. 1995), quoting Kyles, 514 U.S. at 435.
Rather, evidence which must be disclosed is that which “could reasonably [have been]
taken to put the whole case in such a different light as to undermine confidence in the verdict.”
United States v. Coppa, 267 F.3d 132, 139 (2d Cir. 2001), quoting Kyles v. Whitley, 514 U.S.
419, 435 (1995). As the Second Circuit has held, even when evidence may be both inculpatory
and exculpatory, its disclosure is not thus precluded under Brady. See United States v. Mahaffy,
693 F.3d 113, 130 (2d Cir. 2012) (“[t]he fact that the government is able to argue that portions of
the transcripts were consistent with the prosecution’s theory fails to lessen the exculpatory force”
of the remaining parts); see also United States v. Rivas, 377 F.3d 195, 199-200 (2d Cir. 2004).
Here, though, in the pretrial context, as discussed post, disclosure has a broader context.
Thus, when the “exculpatory character harmonize[s] with the theory of the defense case” failure
to disclose that evidence constitutes a Brady violation. Id., quoting United State v. Triumph
Capital Grp., 544 F.3d 149, 164 (2d Cir. 2008). That harmony with defense theories is detailed
in the accompanying ex parte letter.
28
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 19 of 121
D.
The Evidence Related to the Investigation of Former SA Force
Should Be Unsealed Because It Constitutes Brady Material, Thus
Providing a Compelling and Particularized Need for Its Disclosure
The timeliness requirement incorporated in the Brady disclosure obligation compels
disclosure of materially favorable evidence in sufficient time to permit the defense the
opportunity to use it effectively before trial. Coppa, 267 F.3d at 142 (whether the disclosure is
made in a timely fashion depends on the “sufficiency, under the circumstances, of the defense’s
opportunity to use the evidence when disclosure is made”); see also United States v.
Solomonyan, 451 F.Supp.2d 626, 644-645 (S.D.N.Y. 2006).
Thus, implicit in the government’s Brady obligation is the requirement that the defense is
able to use the materially favorable evidence, even if only to uncover additional exculpatory
evidence. See e.g. United States v. Gil, 297 F.3d 93, 104 (2d Cir. 2002) (materially favorable
evidence, even if not admissible itself, must be disclosed pursuant to Brady if it “could lead to
admissible evidence”). Indeed, in Gil, the inclusion of critical exculpatory (and impeachment)
information in boxes of documents produced pursuant to 18 U.S.C. §3500 the weekend prior to
trial was deemed insufficient notice. Id., at 106-07.
Consequently, although the interests in maintaining grand jury secrecy are certainly
stronger while an investigation is ongoing, unsealing is necessary here because evidence of an
investigation of former SA Force is exculpatory, and thus Brady material, disclosure of which is
necessary to avoid “a possible injustice.” See generally Douglas Oil Co. Of California v. Petrol
Stops Northwest, 441 U.S. 211 (1979) (requiring a showing that “material [sought] is needed to
avoid a possible injustice in another judicial proceeding, that the need for disclosure is greater
than the need for continued secrecy, and that their request is structured to cover only material so
29
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 20 of 121
needed”). Certainly, the right to pre-trial access to Brady material presents a particularized
and/or compelling need for its unsealing and disclosure. See e.g. United States v. Youngblood,
379 F.2d 365, 367 (2d Cir. 1967); see also Dennis, 384 U.S. at 868-70 (“disclosure, rather than
suppression, of relevant materials ordinarily promotes the proper administration of criminal
justice”).
In that regard, in a pretrial rather than appellate context – with the latter involving post
hoc considerations of materiality and harmless error – it is respectfully submitted that Dennis
compels pretrial disclosure in this case to promote a fair trial for Mr. Ulbricht, and afford him
Due Process. See also Kathleen Ridolfi, Tiffany M. Joslyn, and Todd H. Fries, Material
Indifference: How Courts Are Impeding Fair Disclosure In Criminal Cases, National
Association of Criminal Defense Lawyers and The Veritas Initiative (Santa Clara University
School of Law), November 17, 2014.6
Accordingly, Mr. Ulbricht’s due process right to exculpatory evidence under Brady
warrants unsealing, and admitting at trial, evidence related to the improper conduct alleged
against former SA Force in the government’s November 21, 2014, letter.
6
The Executive Summary of the NACDL/Veritas Report laments that
[a]cross the nation prosecutors are guiding their disclosure
obligations by a post-trial standard that some courts have decried
as unworkable in the pre-trial context. Prosecutors are ill-equipped
to apply a post-trial standard to a pre-trial obligation without the
benefit of the defense perspective and with their natural biases as
zealous advocates. Taking their cues from the courts, prosecutors
are acting to the detriment of the defense and fair process.
NACDL/Veritas Report, at xv (Executive Summary).
30
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 21 of 121
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
————————————————————————)(
USDCSDNY
DOCUMENT
ELECTRONICALLY FILED
DOC#: ~~~~~~
DATE FILED: DEC 1 2
2014
UNITED STATES OF AMERICA
14 Cr. 68 (KBF)
-v-
SEALED ORDER
ROSS WILLIAM ULBRICHT,
Defendant.
————————————————————————)(
KATHERINE B. FORREST, District Judge:
A conference in this matter is scheduled for Monday, December 15, 2014 at 10:00
a.m. In advance of that conference and not later than 9:00 a.m. that day, the
Government shall respond, by letter, to the following:
1. Is the fact of, or any aspect of the Government's investigation of Carl Force
public or otherwise known to persons or entities outside of the grand jury, the
investigators directly involved in that case or any cases involving Mr.
Ulbricht?
2. Does Mr. Force know he is under investigation?
3. If the fact of the investigation is not publicly known, what (if any) harm
would the Government suffer if it became known?
4. What's the status of the investigation?
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 22 of 121
5. Would the Government be able to reveal any of the facts regarding Mr.
Force's conduct without endangering the grand jury investigation? If so,
which ones? If no facts are known, why not?
SO ORDERED:
Dated:
New York, New York
December I.'l…;- 2014
r
TS-~
KATHERINE B. FORREST
United States District Judge
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 23 of 121
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 24 of 121
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 25 of 121
Thoward1UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
————————————x
UNITED STATES OF AMERICA
-v.-
:
:
ROSS ULBRICHT,
a/k/a “Dread Pirate Roberts,”
a/k/a “DPR,”
a/k/a “Silk Road,”
S1 14 Cr. 68 (KBF)
:
:
:
Defendant.
:
– – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – – -x
MEMORANDUM OF LAW IN OPPOSITION
TO THE DEFENDANT’S MOTIONS IN LIMINE
PREET BHARARA
United States Attorney
Southern District of New York
Attorney for the United States of America
TIMOTHY T. HOWARD
SERRIN TURNER
Assistant United States Attorneys
Of Counsel
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 26 of 121
flight, where there was no other evidence that defendant had become a fugitive). Nor is there
any evidence of some other unrelated criminal conduct in which Ulbricht was engaged that could
explain his conduct. Cf. United States v. Diallo, 461 Fed. Appx. 27, 30 (2d Cir. 2012)
(considering, and rejecting, argument that admission of flight evidence was improper because
defendant's flight could be explained by fact that he was trafficking in illegal cigarettes, rather
than committing robberies).
Finally, as asserted previously, the Court should not exclude evidence of the false
identification documents under Rule 403. (Id. at 18-19). The evidence regarding Ulbricht’s
attempts to obtain fraudulent identification documents is highly probative, and his attempts to
obtain nine fake identification documents on a single occasion are not any more “sensational or
disturbing” than the scope of the alleged offenses in this case, which include a large-scale
narcotics trafficking conspiracy, among other things, such that there would be any legitimate risk
that the evidence will “arouse irrational passions” among the jurors. (Id. at 19).
V.
THE DEFENDANT’S APPLICATION TO UNSEAL INFORMATION
REGARDING THE INVESTIGATION OF DEA SPECIAL AGENT CARL
FORCE AND TO ADMIT THAT EVIDENCE AT TRIAL SHOULD BE
REJECTED
The defendant seeks to unseal evidence regarding an ongoing investigation into a former
Special Agent (“SA”) with the Drug Enforcement Administration (“DEA”), named Carl Force,
and to use that evidence affirmatively at trial. As set forth below, the defendant’s request should
be rejected, for many reasons, including because the evidence is irrelevant and inflammatory and
because there is no sound, particularized need to disclose the evidence that outweighs the interest
in protecting the secrecy and integrity of the ongoing grand jury investigation.
14
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 27 of 121
A.
Facts
By letter dated November 21, 2014, the Government sent an ex parte letter to the Court,
which provided details regarding an ongoing grand jury investigation into SA Carl Force being
conducted by the U.S. Attorney’s Office for the Northern District of California (“USAO-San
Francisco”), in conjunction with the Public Integrity Section of the Criminal Division of the
Department of Justice (the “Force Letter”). The Force Letter requested leave to disclose the
contents of the letter to defense counsel pursuant to Rule 6(e)(3)(E), accompanied by a protective
order prohibiting the disclosure of the Force Letter and the existence of the USAO-San Francisco
investigation of SA Force outside the defense team. The Court granted that request on December
1, 2014, and the Force Letter was provided to counsel for the defendant later that same day.
As set forth in the Force Letter, SA Force participated in an unrelated investigation of
Silk Road coordinated by the U.S. Attorney’s Office for the District of Maryland (“USAOBaltimore”). The Government has not relied on and is not offering any evidence obtained by
that investigation in this case. USAO-San Francisco is investigating allegations that SA Force
has converted hundreds of thousands of dollars’ worth of Bitcoins into U.S. currency and
deposited them into his personal accounts. With respect to SA Force’s involvement in the
USAO-Baltimore investigation of Silk Road, USAO-San Francisco is investigating whether SA
Force may have: (1) leaked or offered to leak investigative information to Ulbricht regarding the
USAO-Baltimore investigation in exchange for payments from Ulbricht; (2) used access to the
Curtis Green (“Flush”) account to steal approximately $350,000 worth of Bitcoins from Silk
Road; and (3) received two payments totaling approximately $85,000 worth of Bitcoins, which
were undocumented and converted for personal use. (Force Letter at 2-5).
B.
Discussion
15
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As set forth in the Force Letter, SA Force did not play any role in this investigation, the
Government does not intend to call SA Force at trial, and the Government is not using any
evidence obtained in the USAO-Baltimore investigation in this case. 2 Accordingly, the facts
underlying the ongoing grand jury investigation of SA Force does not constitute impeachment
material for which disclosure would be required under Giglio v. United States, 405 U.S. 150
(1972). (Force Letter at 5). Nor do those facts exculpate Ulbricht in any manner, or otherwise
aid the defense. (Id.).
As a threshold matter, the grand jury investigation into whether SA Force was involved
in leaking sensitive law enforcement investigation information to the defendant, and that he may
have converted Bitcoins provided to him by the defendant, do not exculpate Ulbricht in any way,
and is not helpful to the defense. (Force Letter at 5). Even if substantiated, such evidence is
plainly inculpatory, as Ulbricht’s attempts to gather counterintelligence on law enforcement
efforts is probative of his knowledge and his attempts to protect his illegal enterprise. (Id.).
Similarly, the fact that SA Force may have converted Bitcoins obtained from Ulbricht for his
personal use would, if true, reflect only corruption on SA Force’s part, and would not be relevant
to the question of Ulbricht’s guilt. (Id.).
The Government’s case against Ulbricht is completely independent of evidence gathered
by SA Force, and the only reference to “Nob” that the Government intends to make in its case in
chief are chats where the defendant and other co-conspirators mention him as the party solicited
2
Nor does the Government intend to use at trial any communications between Ulbricht and SA
Force that were found on the Silk Road Server and Ulbricht’s laptop – even though these
communications include highly incriminating exchanges reflecting Ulbricht’s hiring of “nob” to
arrange the murder of Curtis Green. (Force Letter at 6). As discussed in the Government’s
motions in limine, the Government seeks to offer other evidence of the attempted murder for hire
of Green, through communications that the defendant had with co-conspirators “Inigo” and
“cimon” regarding the murder for hire. (Gov. Mot. at 6-7).
16
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 29 of 121
by the defendant to arrange for the murder of Curtis Green, a/k/a “Flush.” Regardless of whether
SA Force, Green or anyone else stole the Bitcoins, the identity of the culprit is wholly irrelevant
to the fact that the defendant believed that they were stolen by his employee, “Flush.” Upon
learning that “Flush” had been recently arrested, and fearing that he was cooperating with law
enforcement, Ulbricht made the conscious decision to seek to murder “Flush,” in order to protect
his interests in his underground black market website and the illegal proceeds it generated. Even
assuming that the grand jury’s investigation concludes that SA Force was responsible for stealing
the Bitcoins, that collateral fact is not exculpatory as to Ulbricht, as it does not detract from his
criminal intent in ordering the murder for hire.
The Government understands that the defendant has filed an ex parte letter seeking
authority to admit evidence pertaining to the Force investigation at trial. Because it was
submitted ex parte, the Government is not in a position to respond. Counsel for the defendant
has previously suggested in conversations with counsel for the Government that evidence of the
Force investigation might be helpful to support an entrapment defense, but any such argument
lacks merit. The allegations against SA Force do not tend to prove either of the essential
elements of an entrapment defense, including: (1) government inducement of the crime and (2) a
lack of predisposition on the part of the defendant to engage in criminal conduct. See United
States v. Kopstein, 759 F.3d 168, 173 (2d Cir. 2014). Even if SA Force is found to have stolen
the Bitcoins, he at most caused a situation to which the defendant chose to respond to with
violence, which is wholly insufficient to prove an entrapment defense. United States v.
Cromitie, 727 F.3d 194, 204 (2d Cir. 2013) (“The fact that officers or employees of the
Government merely afford opportunities or facilities for the commission of the offense does not
defeat the prosecution.”). Chat logs obtained from the defendant’s computer plainly indicate that
17
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“Nob” (i.e., SA Force), did not induce Ulbricht’s decision to order “Flush” killed; rather, the
decision to solicit “Flush’s” murder originated from the defendant himself, during conversations
he had with co-conspirators “cimon” and “Inigo.”3
In addition to not being aware of any evidence regarding SA Force’s potential theft and
conversion of Bitcoins that would be exculpatory to the defense, the Government has consulted
with the lead Assistant U.S. Attorney in USAO-San Francisco handling the SA Force
investigation, who has also confirmed their position that USAO-San Francisco is unaware of any
such evidence. The compelling interests in preserving the integrity of the grand jury’s ongoing
investigation simply cannot be overcome by purely speculative and conclusory assertions that
otherwise irrelevant and law enforcement sensitive information is exculpatory. Accordingly, the
Court should deny the defendant’s application to unseal the ongoing grand jury investigation and
reject the defendant’s application to disclose any evidence concerning that investigation at trial.
3
Relevant excerpts of the chat logs reflecting discussions between the defendant, SA Force
as “Nob,” “Inigo,” and “cimon” regarding Flush are attached as Exhibit A. Those chat logs
indicate that: (1) “Inigo” first discovered the theft of the Bitcoins via the “Flush” account and
reported it to Ulbricht, and Ulbricht reported the theft to Nob (pp. 1-2); (2) Ulbricht identified
“Flush” to “Nob” as Curtis Green and asked if he could arrange to “get someone to force him to
return the stolen funds” (p. 5); (3) “Nob” replied by asking in an open-ended fashion whether
Ulbricht wanted him “beat up, shot, just paid a visit,” and the defendant responded at the time by
instructing “Nob” to arrange to have Green “beat up” (p. 5); (4) “cimon” initiated a discussion
with Ulbricht about whether they should consider executing Green, and Ulbricht eventually
agreed (pp. 11-13); (5) the very next time that Ulbricht spoke with Nob, Ulbricht, unprompted,
requested that Nob change the order from “torture to execute,” even after Nob told Ulbricht that
beating Green up would not cost Ulbricht anything, but that Ulbricht would have to pay for a
murder for hire (pp. 18-20); and (6) Nob quoted a price of $80,000 in United States currency for
the hit, to which Ulbricht agreed (p. 21). As noted in the Force Letter, the Government does not
intend to use the portions of the chat logs involving Nob at trial, even though the logs are highly
inculpatory.
18
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 31 of 121
EXHIBIT A
Compilation of Torchat Logs Seized from Ulbricht Laptop Reflecting
Communications with SA Force (“Nob”), “Inigo” and “Cimon”
Between January 26, 2013 at 3:39 a.m. and January 29, 2013 at 12:49 p.m. 1
(2013-01-26 03:39) inigo (laptop): [delayed] i hope you get online soon.
we are under attack over 100k stolen, shits hitting the fan you need to
pull the plug on withdrawals
[delayed] over 300k stolen. i think i figured out how to contain it.
[delayed] as far as I can tell it was flush, and he managed to steal a
little over $350k
[delayed] either that or somebody with access to his account
[delayed] but my hunch is that it was him.
[delayed] fortunately i was able to stop it before it got any further
[delayed] looks like he took 900bitcoins from the petty cash fund, and the
rest by changing vendors passwords and resetting their pins, and then
logging into their accounts to wipe out their balances
[delayed] ive been up all night frantically trying to stop this massive
theft, i need to catch a few zzz's
[delayed] ill be back on in a few hours. hopefully in time to see you get
online
(2013-01-26 03:41) myself: you there?
(2013-01-26 04:47) myself: yea, this makes me sick to my stomache. I
decrypted his ID and did some digging. He was arrested for cocaine
posession last week. I think this stuff about his daughter was a tale.
This will be the first time I have had to call on my muscle. fucking
sucks.
(2013-01-26 10:42) Nob: [delayed] my friend you up
(2013-01-26 10:43) myself: i am
(2013-01-26 10:43) myself: how are you amigo?
(2013-01-26 10:43) Nob: I'm tired D, real tired
(2013-01-26 10:44) myself: not enough sleep?
(2013-01-26 10:44) Nob: no I'm working too hard. overseeing three good
size loads coming from South America up here into U.S.
(2013-01-26 10:45) myself: lots of people to coordinate?
(2013-01-26 10:46) Nob: yes, heah i just saw your message on SR
(2013-01-26 10:46) myself: yea, not a ton of money, but it pisses me off
to no end. I trusted the guy too much
(2013-01-26 10:47) Nob: ok, who is it and where is he
(2013-01-26 10:48) myself: ill send you his ID
(2013-01-26 10:48) Nob: how?
(2013-01-26 10:48) myself: I had him send it to me when I hired him
(2013-01-26 10:48) myself: for just this kind of situation
(2013-01-26 10:49) myself: he was recently arrested for cocaine possession
on Jan 17th
1
Torchat communications between Ulbricht and SA Force (“Nob”) are included in their entirety for this designated
time period. Torchat ommunications between Ulbricht and “Inigo”/”Cimon” are excerpts of relvant portions
regarding the theft of Bitcoins by Curtis Green, a/k/a “Flush.”
1
Case 1:14-cr-00068-KBF Document 227-1 Filed 03/31/15 Page 32 of 121
(2013-01-26 10:50) Nob: that wasn't the kilo that I sent was it. because
I'm going to be pissed
(2013-01-26 10:50) myself: did you send it to UTAH?
(2013-01-26 10:52) Nob: yes, it's an address that googleyed gave to me.
and i'm having problems with him/her
(2013-01-26 10:52) myself: are you serious!
(2013-01-26 10:52) Nob: yes what the mierda
(2013-01-26 10:52) myself: mierda?
(2013-01-26 10:53) Nob: what you want done? what the fuck is up with the
googleyed. i don't need this shit
(2013-01-26 10:54) Nob: and who is the frickin idiot?
(2013-01-26 10:54) myself: I'm incredibly sorry nob, but this guy on the
ID
(2013-01-26 10:54) myself: he's the one I asked to set you up with vendors
(2013-01-26 10:55) myself: he mu