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United States v. Pistotnik

United States District Court, D. Kansas

May 23, 2019




         This matter comes before the Court on Defendant Bradley Pistotnik's Motion for Reconsideration of the Magistrate Judge's Memorandum and Order granting in part and denying in part a motion to quash that was filed by nonparties Xcentric Ventures, LLC (“Xcentric”) and Chandler Automated Systems (“Chandler”). For the reasons the Court explains below, Pistotnik's Motion for Reconsideration (Doc. 71) is granted in part and denied in part.

         I. Factual and Procedural Background

         The Government alleges that Pistotnik, together with his co-defendant, David Dorsett, threatened to cause damage to Xcentric's computer systems by targeting a website Xcentric owns and operates: (“Ripoffreport”).[1] Ripoffreport allows consumers to post anonymous reports detailing ways in which they have been wronged by different businesses. Ripoffreport has a general policy against releasing its users' identities and against removing any of the posted reports from its site.

         Sometime around September 2014, a negative report about Pistotnik (“the Report”) was posted to Ripoffreport. The Government alleges that Pistotnik and Dorsett sent Ripoffreport threatening messages via an “email bomb”-a large quantity of emails designed to overwhelm the recipient's digital infrastructure-stating that if Ripoffreport removed the Report from its site, the onslaught of emails would end. But if the Report was not removed, the harassing emails would continue and Ripoffreport's advertisers would also be targeted. The first “email bomb” attack was sent in September 2014, and Ripoffreport capitulated to the sender's demands by removing the Report from its site. Within months, the Report was reposted to Ripoffreport. In July 2015, Ripoffreport was bombarded with a second series of threatening emails.

         After the Government brought its charges, Pistotnik served subpoenas duces tecum on Xcentric and Chandler, a company providing cyber security and IT services to Xcentric. Pistotnik's subpoenas requested documents relating to, among other things, the Report's authorship, Xcentric's damages from the attack, and Xcentric's cyber-defense infrastructure. In total, the subpoena to Xcentric included 15 paragraphs of subpoenaed documents, and the subpoena to Chandler included eight paragraphs of subpoenaed documents. Before serving his subpoenas, Pistotnik filed a motion seeking authorization to serve his subpoenas on Xcentric and Chandler, as well as on other parties. This Court contacted Pistotnik's counsel by phone and informed him that he did not need the Court's further permission to issue the subpoenas;[2] the Court subsequently entered an order denying Pistotnik's motion as moot.

         Xcentric and Chandler filed a motion to quash both subpoenas. That motion was referred to the Magistrate Judge assigned to the case, who granted it in part and denied it in part. Pistotnik's Motion for Reconsideration now before the Court requests review of the Magistrate Judge's order. On May 6, 2019, the Court heard oral argument on Pistotnik's Motion. At this hearing, Pistotnik informed the Court that he was withdrawing any objection to the Magistrate Judge's order granting the motion to quash Paragraphs 3 and 6-8 in the Xcentric Subpoena. Pistotnik maintained his objections to the Magistrate Judge's order granting the motion to quash Paragraphs 1, 2, and 9-15 of the Xcentric subpoena and Paragraphs 1-8 of the Chandler subpoena.

         II. Legal Standard

         The Court reviews the Magistrate Judge's order under a clearly erroneous standard Pursuant to Fed. R. Crim. P. § 59(a):

A district judge may refer to a magistrate judge for determination any matter that does not dispose of a charge or defense. The magistrate judge must promptly conduct the required proceedings and, when appropriate, enter on the record an oral or written order stating the determination. A party may serve and file objections to the order within 14 days after being served with a copy of a written order or after the oral order is stated on the record, or at some other time the court sets. The district judge must consider timely objections and modify or set aside any part of the order that is contrary to law or clearly erroneous. Failure to object in accordance with this rule waives a party's right to review. (Emphasis added).

         III. Analysis

         In United States v. Nixon, [3] the Supreme Court held that to obtain documents under a Rule 17 subpoena, the party seeking the documents must demonstrate:

(1) that the documents are evidentiary and relevant; (2) that they are not otherwise procurable reasonably in advance of trial by exercise of due diligence; (3) that the party cannot properly prepare for trial without such production and inspection in advance of trial and that the failure to obtain such inspection may tend unreasonably to delay the trial; and (4) that the application is made in good faith and is not intended as a general fishing expedition.[4]

         Put another way, three obstacles must be overcome before issuing a subpoena under Rule 17: relevancy, admissibility, and specificity.[5] A party that has been served a subpoena may move the court “[to] quash or modify the subpoena if compliance would be unreasonable or oppressive.”[6] Additionally, “a subpoena requiring the production of personal or confidential information about a victim may be served on a third party only by court order.”[7]

         Here, Pistotnik raises several objections to the Magistrate Judge's order partially granting the motion to quash Pistotnik's subpoenas served on Xcentric and Chandler. The gravamen of Pistotnik's Motion is his objection to the Magistrate Judge's holding that the identity of the Report's author is not relevant under Nixon. Pistotnik also argues that the Magistrate Judge erred in holding that information about Xcentric's cyber-defenses is not relevant under Nixon. Finally, Pistotnik objects to the Magistrate Judge's conclusion that Pistotnik disregarded Rule 17's requirement that he obtain Court permission prior to serving his subpoenas, arguing that this misunderstanding permeates the Magistrate Judge's order and resulted in the court quashing significant portions of both subpoenas that would otherwise have been allowed.

         A. Relevance of the Report's authorship

         Pistotnik objects to the Magistrate Judge's determination that Paragraphs 1 and 2 of the Xcentric subpoena-seeking documents concerning the Report's authorship[8]-failed to overcome Nixon's relevancy hurdle. Pistotnik makes the initial argument that the Magistrate Judge's relevancy standard was impermissibly high. Pistotnik then provides two ways in which the Report's authorship should be deemed relevant. First, assuming Pistotnik's co-defendant Dorsett is the author of the Report, Pistotnik would introduce “Reverse 404(b)” evidence against Dorsett. Second, Pistotnik would use the authorship of the Report to impeach Dorsett's testimony.

         1. Relevancy standard

         Pistotnik argues that the Magistrate Judge improperly held that evidence is only relevant if it would serve as an absolute defense to the crimes charged. The Court disagrees with this characterization of the Magistrate Judge's order. The Court reads the Magistrate Judge's order as stating that regardless whether Dorsett authored the Report, baited Pistotnik into committing the crime, or solicited Pistotnik's business, such evidence would have no bearing on Pistotnik's criminal liability. The issue was not whether the Report's authorship would completely exonerate Pistotnik but whether it had any connection to Pistotnik's alleged crimes. The Magistrate Judge held that it did not. Nothing in the Magistrate Judge's Order indicates that the court reached this decision using an improperly narrow relevancy standard.

         2. Reverse ...

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