Press Releases: December 2001
On Dropping of Charges Against Dmitry Sklyarov
The United States Attorney's Office for the Northern District of California announced that Dmitry Sklyarov entered into an agreement this morning with the United States and admitted his conduct in a hearing before U.S. District Judge Whyte in San Jose Federal Court.
Under the agreement, Mr. Sklyarov agreed to cooperate with the United States in its ongoing prosecution of Mr. Sklyarov's former employer, Elcomsoft Co., Ltd. Mr. Skylarov will be required to appear at trial and testify truthfully, and he will be deposed in the matter. For its part, the United States agreed to defer prosecution of Mr. Sklyarov until the conclusion of the case against Elcomsoft or for one year, whichever is longer. Mr. Sklyarov will be permitted to return to Russia in the meantime, but will be subject to the Court's supervision, including regularly reporting by telephone to the Pretrial Services Department. Mr. Sklyarov will be prohibited from violating any laws during the year, including copyright laws. The United States agreed that, if Mr. Sklyarov successfully completes the obligations in the agreement, it will dismiss the charges pending against him at the end of the year or when the case against Elcomsoft is complete.
Mr. Sklyarov, 27, of Moscow, Russia, was indicted by a federal Grand Jury on August 28, 2001. He was charged with one count of conspiracy in violation of Title 18, United States Code, Section 371, and two counts of trafficking for gain in technology primarily designed to circumvent technology that protects a right of a copyright owner in violation of Title 17, United States Code, Section 1201(b)(1)(A), and two counts of trafficking for gain in technology marketed for use in circumventing technology that protects a right of a copyright owner in violation of Title 17, United States Code, Section 1201(b)(1)(A).
In entering into the agreement with the government, Mr. Sklyarov was required to acknowledge his conduct in the offense. In the agreement, Mr. Sklyarov made the following admissions, which he also confirmed in federal court today:
"Beginning on a date prior to June 20, 2001, and continuing through July 15, 2001, I was employed by the Russian software company, Elcomsoft Co. Ltd. (also known as Elcom Ltd.) (hereinafter "Elcomsoft") as a computer programmer and cryptanalyst.
"Prior to June 20, 2001, I was aware Adobe Systems, Inc. ("Adobe") was a software company in the United States. I was also aware Adobe was the creator of the Adobe Portable Document Format ("PDF"), a computer file format for the publication and distribution of electronic documents. Prior to June 20, 2001, I knew Adobe distributed a program titled the Adobe Acrobat eBook Reader that provided technology for the reading of documents in an electronic format on personal computers. Prior to June 20, 2001, I was aware that documents distributed in the Adobe Acrobat eBook Reader format are PDF files and that specifications of PDF allow for limiting of certain operations, such as opening, editing, printing, or annotating.
"Prior to June 20, 2001, as a part of my dissertation work and as part of my employment with Elcomsoft, I wrote a part of computer program titled the Advanced eBook Processor ("AEBPR"). I developed AEBPR as a practical application of my research for my dissertation and in order to demonstrate weaknesses in protection methods of PDF files. The only use of the AEBPR is to create an unprotected copy of an electronic document. Once a PDF file is decrypted with the AEBPR, a copy is no longer protected by encryption. This is all the AEBPR program does.
"Prior to June 20, 2001, I believed that ElcomSoft planned to post the AEBPR program on the Internet on the company's website www.elcomsoft.com. I believed that the company would charge a fee for a license for the full version of the AEBPR that would allow access to all capabilities of the program.
"After Adobe released a new version of the Adobe Acrobat eBook Reader that prevented the initial version of the AEBPR program from removing the limitations or restrictions on an e-book, I wrote software revisions for a new version of the AEBPR program. The new version again decrypted the e-document to which it was applied. The version of this new AEBPR program offered on the Elcomsoft website only decrypted a portion of an e-document to which it was applied, unless the user had already purchased a fully functional version of the earlier version and had both versions installed on the same machine. The new version was developed after June 29, 2001. At that time, Elcomsoft had already stopped selling the program. The version of this new program offered on the Elcomsoft website did not provide a user with an opportunity to purchase it or convert it to a fully functional one, and was developed as a matter of competition.
"On July 15, 2001, as part of my employment with Elcomsoft, I attended the DEF CON Nine conference in Las Vegas, Nevada. At the conference I made a presentation originally intended for the BlackHat conference that immediately preceded the DefCon Nine in July 2001 in Las Vegas, Nevada. The same group of people organizes both BlackHat and DefCon Nine. Since there was no available slot for a presentation at BlackHat at the time when the paper was sent for the committee consideration, the organizers of both conferences suggested that the paper be presented at the DefCon rather than at BlackHat. The paper that I read at DefCon is attached as Exhibit A. A principal part of my presentation is comprised of my research for the dissertation. In my presentation when I said "we", I meant Elcomsoft."
Mr. Sklyarov's employer, Elcomsoft, remains charged in the case, and the Court in that matter has set hearings for various motions on March 4, 2002, and April 1, 2002.
The prosecution of Elcomsoft is the result of an investigation by the Federal Bureau of Investigation. Scott Frewing and Joseph Sullivan of the Computer Hacking and Intellectual Property ("CHIP") Unit are the Assistant U.S. Attorneys who are prosecuting the case with the assistance of legal technician Lauri Gomez.
On Dropping of Charges Against Dmitry Sklyarov
Dmitry Sklyarov, the Russian Programmer arrested by the FBI in July and detained in the US under the Digital Millenium Copyright Act of 1998, will be home for Christmas. Today, US Federal Court Judge Ronald M. Whyte signed the order approving a Diversion Agreement for this mild mannered Russian intellectual. The agreement will ultimately release Dmitry from all criminal charges, but more immediately this agreement allows him and his family to return to their homeland, Russia. In a statement on the proceedings, lead attorney John Keker expressed his views on today's agreement: "With this agreement, Dimitry gets everything he could get from an acquittal, and more. The indictment will be dismissed eventually, he gets to tell his story truthfully without pressure from the government, and he gets to go home now, rather than wait in the US while the case is fought. We are pleased with the result, and look forward to ElcomSoft's eventual acquittal."
Dmitry, relieved and pleased about the outcome, is not opening up the vodka just yet - "Until I'm in Russia, it is too early to say that I'm happy. But this agreement looks like [the] first significant change in my situation for last five months, [my] first real chance to get home."
In today's agreement, Dmitry will be required to testify for the government and ElcomSoft expects him to testify for their case as well. The story Dmitry has to tell is exactly the same regardless of which side calls him to testify. Dmitry's story has not changed since that day in July, when the FBI arrested him in Las Vegas, and he is quite happy to tell his story again and again, if need be.
ElcomSoft, the Russian Security Software Development Company indited under the same DMCA charges and Dmitry's employer, is thankful for the outcome of today's proceedings. CEO Alex Katalov is quick to point out "ElcomSoft has always made Dmitry's welfare it's highest priority - we are very pleased that there has been a solution that minimizes the risk for Dmitry and allows him and his family to return to Russia." When asked about today's decision and the effect it could have on ElcomSoft's case, Katalov replied "this decision actually liberates us from worrying about Dmitry going to jail - now [that] this risk is removed, the company can pursue its own defense more aggressively."
Joe Burton, lead attorney for ElcomSoft, reacted to today's outcome saying "I want to make a statement on behalf of ElcomSoft, my client. Both my client and I have, since the beginning of this case, maintained Dmitry's innocence on any and all criminal activity. From day-one of the arrest ElcomSoft has been willing to have the Government proceed against them and NOT Dmitry". Burton further states, "you may remember that ElcomSoft offered to take Dmitry's place and substitute the company as the sole defendant in this case. The company knows that neither Dmitry nor they committed any criminal acts and believes that in the end, they will be found innocent of any and all charges the U.S. Government is bringing against them as well."
The case continues with one exception, its unwitting hero, Dmitry Sklyarov, is no longer detained in the U.S. and his thoughts are now on his family his career and the upcoming holiday season in his homeland, at last.
Russian Programmer Freed, Must Testify Against Employer
U.S. Federal Court Judge Ronald Whyte today signed a court agreement permitting Russian programmer Dmitry Sklyarov to return to his native land after a five-month enforced stay in the U.S. The agreement should eventually clear him of all charges brought against him for distributing software that permits electronic book owners to convert the Adobe e-book format so they can make use of e-books without access restrictions.
As part of the agreement, Sklyarov will testify for the government in the case that remains against Elcomsoft, Sklyarov's employer. He will likely testify on behalf of Elcomsoft as well.
"Dmitry programmed a format converter which has many legitimate uses, including enabling the blind to hear e-books," explained EFF Intellectual Property Attorney Robin Gross. "The idea that he faced prison for this is outrageous."
"There was a tremendous outpouring of grassroots support for Dmitry and against the current U.S. copyright law, and EFF is proud to have been part of such a successful effort," stated EFF Executive Director Shari Steele. "I'm disappointed, however, that the government has decided to string this along instead of admitting its mistake in bringing these charges against Dmitry in the first place."
EFF weakened the case against Sklyarov by negotiating with Adobe representatives on July 20, 2001, resulting in a statement from Adobe saying that the company no longer wished to pursue any case against Sklyarov. EFF also met with representatives of the U.S. Department of Justice for the Northern District of California on July 27 pursuing negotiations aimed at dropping all charges against Sklyarov and securing his immediate release from jail.
The 27-year-old programmer was arrested on July 16 and held in jail until August 6, when he was released on $50,000 bail on condition he remain in California.
Sklyarov, who has been living in San Mateo with his wife and two children pending resolution of the case, has often expressed his eagerness to return to Russia.
Sklyarov's case is the first time a programmer was jailed simply for coding and distributing software. The software developer faced up to 25 years in prison under the Digital Millennium Copyright Act (DMCA) in the first criminal prosecution brought under the controversial statute which forbids distributing technology or information that can be helpful in bypassing technological restrictions. The case is one of a series of cases brought under the DMCA, a law many experts feel pushes the balance of copyright law too far toward the companies holding the copyrights and away from traditional fair use of copyrighted materials, for example in research and education.