By 1966 Cohen was an old pro; he had been at the bar for thirty-eight years and spent much of that time defending syndicate members. Together he and his young partner, Miami attorney James Hogan, assembled their blue box defense strategy. In both cases the key legal issue boiled down to this: Under what circumstances did the phone company have the legal right to wiretap your telephone line? And, when it did wiretap you, what could it do with the information?
In 1966 the law of the land on the subject of wiretapping was Section 605 of Title 47 of the United States Code. It read, in part: “No person . . . shall intercept any communication and divulge or publish the existence or contents of such intercepted communication.”
This is fascinating wording. Under Section 605, merely intercepting a phone call is not illegal; it is interception followed by divulgence that is a crime. In other words, under Section 605 you could wiretap to your heart’s content but you couldn’t tell anybody about what you heard.
As far as Cohen and Hogan were concerned, this was precisely what the telephone company had done. That is, it had wiretapped Hanna’s and Bubis’s lines and then disclosed the results to the government. AT&T had violated Section 605, plain and simple. And, as such, all of the government’s tape recordings—the entirety of the evidence, really—had to be thrown out. As Hogan argued to the judge in the Hanna case, “We submit that there are no exceptions to Title 47, Section 605; that we have proved interception; that we have proved divulgence.” To Hogan, it was an open-and-shut case in the defense’s favor: the telephone company’s tapping of Hanna’s line was clearly illegal.
Cohen summed it up this way to the judge.
Now, there is no omnipotence to the telephone company as far as I am concerned. I can’t see them being any greater than any small corporation. They have no greater standing than the Government. The President of the United States issued a proclamation that there shall be no wire tapping except in national emergencies, and he did not add, “with the exception of the telephone company.” He didn’t add, “if they are being defrauded.” Now, the telephone company in this case decided there was probable cause. It was not done by a court of law. It was they who decided there was probable cause to tap the phone and divulge. The great telephone company decides what their probable cause is. They decide whether or not they should tap the phone, and then they send it over to the Federal government. Now, Section 605 says, No one shall divulge what they hear over a wire . . . they don’t say, “Nobody but the telephone company.”
Nonsense, responded the U.S. attorney prosecuting Hanna. “The telephone company gets the right to monitor its lines under certain circumstances because it is their lines . . . it would be shocking and illogical not to permit them.” And once they’ve monitored and found hanky panky, they obviously need to be able to tell law enforcement about it.
What is the telephone company to do with it? Are they not permitted to take the results of their own independent investigation to law enforcement officials to see if these things can’t be stopped? People have been defrauding them of revenues. Are they not to be punished? Are they permitted merely to monitor the line and determine that Mr. Hanna has, in fact, a blue box on there and he is defrauding them out of $500 or $1,000 of revenue per month and do nothing about it? Do they not have the right to seek whatever steps they deem appropriate in order to correct this situation?
The U.S. attorney in the Hanna case had another card up his sleeve: a Supreme Court case called United States v. Sugden. In the Sugden case the bad guys used radios while they were committing a crime. The government overheard them on the radio and presented recordings of their radio transmissions as evidence against them in court. The defendants claimed that this evidence was illegally obtained under Section 605; as in the Hanna case, they argued that the government had illegally intercepted and divulged the contents of their communications and thus the recordings couldn’t be used as evidence. The government countered that Section 605 didn’t apply because the defendants did not have a license to use their radios, that they were on the air illegally. The government claimed that if you’re using a communications facility illegally—just like Hanna was, for example, when he was using his blue box to make free phone calls—then Section 605 didn’t apply. In other words, your right to privacy evaporates when you’re on the line illegally. The Supreme Court agreed.
The blue box bookies lost both cases. Out in California, Bubis was convicted in August 1966, fined $2,000, and given a one-year suspended sentence. Loman, his codefendant, was acquitted. Beckley, the bookie the government had been after for so long, escaped on the thinnest of technicalities: the grand jury indictment against him had neglected to include the word willfully in a key sentence. In Florida, Hanna and Modell were both convicted on December 2, 1966, and sentenced to six months in prison and five years’ probation. Hanna was also fined $10,000.
All three appealed.
Hanna and Modell’s appeal focused mainly on suppressing the government’s tape recordings. It hammered home the idea that Section 605 does apply to telephone companies, that is, that there is no special right that the telephone company has to monitor its lines. But it also alleged that the government was in bed with the phone company to improperly gather evidence on bookmaking. In California, Bubis’s attorney argued that the telephone company had gone nuts. First, he said, the telephone company had disclosed to the feds that Bubis’s telephone calls “sounded like gambling” before any subpoena had been issued to them—a clear violation of Section 605. Second, the telephone company had recorded not just a few minutes of Bubis’s calls but all of them—a gross violation of Bubis’s rights.
On October 20, 1967, California’s Ninth Circuit Court of Appeals derailed AT&T and the Justice Department’s winning streak. By listening to all of Bubis’s calls over a period of months the phone company had greatly overreached, the appeals court said, and reversed Bubis’s conviction. As the three-justice panel wrote:
While we realize the result we have just reached means that the appellant will go unwhipped of justice, nevertheless, we reach the result on the ground that that fact is less important than that the telephone company should not resort to unreasonable and unnecessary practices which we deem contrary to the provisions of Section 605.
This was the first loss for the government and the phone company on the subject of blue boxes. And, of course, the Hanna case was still up on appeal. In fact, both sides in Hanna had just presented oral arguments to the Fifth Circuit Court of Appeals in Florida. Seeing this as either a great opportunity or a terrible threat, Hanna and the government both rushed to file supplemental briefs with the Fifth Circuit to persuade it that the Ninth Circuit was right, or had lost its marbles, depending on which side was doing the persuading.
Six months later, on March 5, 1968, the Fifth Circuit Court of Appeals in Florida borrowed some poetic phraseology from its Ninth Circuit brethren in California and handed the government its second loss.
Congress may have thought it less important that some offenders should go unwhipped of justice (and that the telephone company lose some long distance tolls) than that officers (or telephone company employees) should resort to methods deemed inconsistent with ethical standards and destructive of personal liberty.
Yet the court’s decision was strange. Although the appeals court did direct the lower court to reverse its findings, each judge wrote his own opinion on the case. Far from being unanimous, it was a one-one-one split: the senior judge sided with defendants Hanna and Modell, the second judge sided with the government, and a third judge took the position that while the telephone company might have the right to monitor illegal calls, it did not have the right to disclose the results of monitoring to law enforcement.
Faced with two reversals and a crumbling legal strategy, the government threw a Hail Mary pass: it petitioned for a rehearing, a legal move that almost never works. It emphasized that the court of appeals�
� ruling left the government and the telephone company at a loss for legal guidance going forward. It pointed out that of all the judges in the Fifth Circuit who had considered blue box cases to date, only one of them (the senior judge in the three-judge panel) felt that telephone company tape recordings were inadmissible. Moreover, the government argued, the Fifth Circuit Court of Appeals had neglected even to consider the Sugden case, the only relevant Supreme Court case in the matter.
Astonishingly, the appeals court agreed to rehear the case.
It was time to pull out all the stops. Bill Caming, AT&T’s attorney, filed a detailed twenty-two-page “friend of the court” brief that took apart the Fifth Circuit decision piece by piece. He argued that illegally placed calls cannot enjoy the protection of Section 605, that there was no reasonable way to gather evidence in these cases other than by recording the calls, and that electronic toll fraud was a large and growing problem for the telephone industry. Caming elaborated in grim detail on this last point.
Within the past few years the use of electronic toll fraud devices, which are relatively inexpensive to make, has grown at a disturbing rate. We estimate that blue boxes can be mass-produced at a cost of about $25 to $50 per unit, and “black boxes” at a cost of $1.00 or less per unit. Experience has shown these devices have a unique appeal to the criminal element. It enables them not only to evade the payment of lawful telephone charges, but also to falsify or avoid completely any record of the communications made in furtherance of their various illicit operations. [. . .]
We can only conjecture at the full scale of the substantial revenue losses sustained by the telephone industry and its ratepayers. Nonetheless, if the Court deem it desirable, we are prepared to show that since 1961 over 130 blue boxes, over 300 black boxes, and many “cheese boxes” have been seized. Some 224 different individuals were implicated. As in many criminal areas where detection is difficult, the instances of electronic toll fraud unearthed by the telephone companies represent merely that portion of the iceberg visible to the eye. [. . .]
The virtually unchecked use of toll fraud devices which could ensue if the threat of federal prosecution is removed would impose an unwarranted financial burden on the telephone industry and its honest customers. The latter would be required to underwrite the entire cost of these depredations.
On November 18, 1968, the Fifth Circuit Court of Appeals did something even more rare than granting a rehearing: it reversed itself. In a judicial mea culpa the court’s opinion stated:
On original hearing, Judge Rives wrote what was intended to become the opinion of the Court. Judge Gobold concurred specially, and Judge Hughes dissented. On further consideration, it appears that Judge Rives’ original opinion is in error both as to the facts and as to the law.
The court summarized where it went wrong—quoting liberally from Caming’s brief—and concluded with the sentence: “The judgments of conviction of both Hanna and Modell are therefore affirmed.”
The Hail Mary had worked. Caming recalls, “Outside of an opening salutation by the court, they adopted the nine pages or so of my brief as their opinion, not even mentioning that it was from my brief. That is the first and only time that ever happened to me. I couldn’t believe it!”
Hanna and Modell must have figured that, if it worked for the prosecution, it could work for them. Two weeks later they filed a petition for a second rehearing. This time the court said no, so they appealed to the Supreme Court. On May 5, 1969, the Supreme Court declined to hear their case. More than three years after the FBI took a sledgehammer to Ken Hanna’s door, the issue was finally settled. If you were making illegal calls you had no right to privacy. The phone company could tap your line and turn the recordings over to law enforcement.
For the phone company, the victory was about much more than convicting Hanna or Bubis. AT&T now had a case that had gone all the way to the Supreme Court, one that proved, definitively, that 18 USC 1343—the Fraud by Wire law that the Justice Department had believed wasn’t relevant—did apply to blue boxes. Thanks to Hanna’s failed appeal, the matter was now settled. AT&T finally had an arrow in its quiver to use against the fraudsters.
Throughout all of this legal drama one mystery remains: how had the telephone company found out about Hanna’s or Bubis’s blue box calls in the first place?
In the Hanna case, Miami telephone company security agent Jerry Doyle received a telephone call from the Internal Audit and Security Group at AT&T headquarters in New York asking him to investigate Hanna’s telephone line for a possible blue box. How did investigators in New York know that somebody in Miami was making illegal calls? Hanna’s attorneys asked Doyle this very question but Doyle said he didn’t know.
There was a one-word answer that nobody was giving: Greenstar.
Hanna had been caught up in AT&T’s toll fraud surveillance network. Imagine what would have happened if this had come out during Hanna’s trial. After all, the Hanna case took almost four years to resolve and went to the Supreme Court based on tape recordings of each of his illegal calls. Think of the legal circus that would have ensued if Hanna’s defense attorneys had learned that the telephone company had been randomly monitoring millions of telephone calls nationwide and recording hundreds of thousands of them.
This added considerably to the stress of prosecuting Greenstar cases. AT&T attorney Caming recalls, “That was the problem in the Hanna case! Fortunately, defense counsel never probed too far as to what our original sources of information were.” With blue box prosecutions, he adds, “We were always on pins and needles as to what might spill over into the public press.”
Fortunately for AT&T in the Hanna and Bubis cases their luck held. And although Caming wasn’t a gambler or a bookmaker, he knew a thing or two about luck. In particular, he knew it didn’t last forever.
Nine
Little Jojo Learns to Whistle
“HHANG UP THE phone and leave it alone!”
Joe was about four years old when his mother first shouted that phrase at him; it was a shout he would hear again and again as he grew up. His mother could be forgiven for raising her voice. She tried to be supportive, she really did, but sometimes her son’s obsession with the telephone was just a little much for her. And besides, the shout didn’t work. Joe soon turned the phrase into a little song, one he would sing over and over again to himself in a quiet, lilting voice: “Hang up the phone and leave it alone, hang up the phone and leave it alone . . .”
Joe was born in 1949. His given name was Josef Carl Engressia Jr. but his family called him Jojo. His mom, Esther, stayed at home and took care of Jojo and his sister, Toni. Dad—Joe Sr.—was a high school year book photographer. Though they struggled financially, they lived in a small but serviceable apartment in Richmond, Virginia. They had a car. They had a dog. In many ways the Engressias appeared to be a stereotypical postwar baby boom family.
But, as we know, appearances can be deceiving.
First there was the blindness. Joe was born blind, as was his sister. The doctors didn’t know what caused it for either of them. It cannot have been an easy thing for Esther and Joe Sr. having two blind children. Any parent will tell you that having kids isn’t easy. Having two blind kids is much harder, the sort of harder that make for stress, for anger, for fighting. “I won’t lie to you,” says Toni. “Our parents fought a lot.”
Then there was the incandescence of little Joe’s mind. When he was three Jojo would pester the adults to read aloud to him. Before long, he wanted them not just to read to him but to tell him how the words were spelled. Soon after that, he wanted the adults just to read the letters to him—he would piece the letters together and form them into words and sentences, handling the work of “reading” himself. “Before I was four I knew how to be read to with people spelling the words,” he said. “So when I learned Braille I already knew how to read and learned in only a month or two.”
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Jojo didn’t have much use for playtime. “I didn’t like play,” he said. “I told the kindergarten teacher, ‘play stinks!’” Instead of play, “I wanted people to read to me by spelling the words.”
Then there were the obsessions—many, many obsessions. Young Josef was famous for them. Shower curtains were one; he loved the sound that a plastic shower curtain made as it swished back and forth on itself. Jell-O was another. Jojo constantly asked his mom to make him a pot of Jell-O, saying repeatedly, “When is the Jell-O going to jell?” Then there was his fascination with brassieres. His sister recalls, “It was all I could do to keep him from going outside with Mother’s bra wrapped around his head.”
The greatest of his obsessions was the telephone. It started around the same time as he learned to read. “I used to ask what time it was, all the time, so Mother started dialing it on the phone. It entranced me, how I could hear another voice like that.” The phone company used to offer a free recording you could dial that would tell you the correct time; in Joe’s area that number was 737. Tired of dialing it for her son, Esther Engressia stuck pieces of tape on the 7 and the 3. Joe could run his fingers over the cool metal dial of their rotary phone, his fingers seeking the roughness of the bits of tape. With this, Joe could dial the time himself. Joe would dial 737 constantly, just to listen to the voice. One day Joe noticed that the 3 was three holes away from the dial stop and 7 was seven holes away. “I thought, well, if 3 is 3 away and 7 is 7 away, maybe 2 is 2 away and 4 is 4 away, and all that.” Joe dialed a number at random, remembering the digits as he dialed. He heard a ringing signal. A woman’s voice answered. “I asked, ‘Is this 439011?’ And she said yes, what do you want? And I said, ‘Oh boy, I just learned how to dial!’”
Exploding the Phone : The Untold Story of the Teenagers and Outlaws Who Hacked Ma Bell (9780802193759) Page 13