Ross Ulbricht got a Fair Trial(but not a fair investigation)

As I write this, the trial of Ross Ulbricht, the alleged “Dread Pirate Roberts” behind Silk Road, is just winding down. The last minute defense experts, having been blocked from testifying, have already resulted in yet more cries that Ulbricht’s trial is unfair and stacked against the defendant. Having carefully watched the case from the moment of Ulbricht’s arrest (and with the PACER bills to prove it), such cries are unfounded. Ulbricht received a fair trial. The investigation, and the quality of Joshua Dratel, Ulbricht’s well compensated and well regarded lawyer, on the other hand…

The arrest of Ross Ulbricht got its start when the FBI somehow discovered the real location of the Silk Road server in Iceland. They asked their friends in Iceland to look into this, and the Icelandic authorities created a copy of the server. With the server image in hand, everything else fell into place. They were able to identify Ulbricht through a plethora of links from the server, ranging from a bit of code in a question to StackOverflow posted in early 2013 to ssh access to the administration interface. Using this information, the investigators obtained more search warrants and an eventual arrest warrant, leading up to the moment when the FBI tackled Ulbricht in the Library with the Laptop Forensics Toolkit. Once they seized the laptop, they found a gold mine. For Ross Ubricht apparently committed one of the cardinal sins of drug dealing…

He kept notes on a criminal fucking conspiracy.

Yet how the FBI discovered the server in the first place remained a mystery: it was presented as effectively a gift from God. And when the FBI finally had to reveal this mystery, they didn’t. To put it politely, the FBI response was inconsistent with reality. Others have been more blunt, calling it “lying” and “gibberish”. And it is the FBI’s own evidence, provided to the defense, that shows that the FBI effectively lied in the court filing detailing server discovery.

Every shred of evidence except for two “hey, I found this site” posts derives solely from the server seizure. Now apparently an IRS investigator had found these two posts before the server was discovered, but these posts wouldn’t sustain a search warrant of Ulbricht’s gmail account, let alone an arrest warrant for Ulbricht. So if the defense could get the blatantly illegal search of the server tossed, the defendant could walk away.

So why is Ross Ulbricht still on trial, and rapidly heading towards an almost certain “guilty” verdict and a few decades worth of mandatory minimum sentences? Because Ulbricht’s lawyer either believed a transparently bullshit story from the defendant about how Ulbricht was framed, Ulbricht was a recalcitrant defendant, or Dratel cynically wanted to keep getting paid…

One of the foundations of US jurisprudence is “standing”: if you don’t have an interest in something, you have no say in court. In 4th amendment case law, this requires that the defendant declare a legal interest in the item searched. For example, if the police conduct a blatantly illegal search of my car, but the only thing they find is evidence concerning someone else’s criminal activity, that someone else has to declare a privacy interest in my property. So in order for Ross Ulbricht (rather than the “Dread Pirate Roberts”) to contest the server seizure, he’d have to file a declaration stating “The Silk Road server seized in Iceland was mine”. Without such a declaration, the court can’t even consider whether the seizure was legal.

Such a declaration is not an admission of guilt: it can only be used by the prosecution if the defendant testifies. So as long as Ulbricht doesn’t testify, the jury never learns that Ulbricht admits to controlling the server. Mysteriously, the defense never claimed the server, even after a 12th hour, handwritten “Are you sure about this dude” opportunity from the judge. The defense refused, so the judge denied the motion to suppress.

So why these mysterious tactics? The first possibility is that Dratel believed his client. If so, you’d want to preserve his ability to testify. Yet the defense had the server and laptop for months, complete with both the infamous diary and Ulbricht’s admitted stash of Bitcoins. It was a simple matter for me, with just public information and a couple hours coding, to trace 20% of Ulbricht’s stash as coming directly from Silk Road. It turns out that the wallet.dat files were able to trace many more. To my mind, a defense attorney simply believing a client’s falsifiable statements, without at least checking, seems incompetent.

So the defense should have known that puting Ulbricht on the stand would be absolute suicide: the prosecution would start with “So why were you holding the Dread Pirate’s Bitcoins?” and the day would get worse from there.

The second, and most likely possibility was that Ulbricht was simply a difficult client. Every lawyer can tell stories of clients who, after receiving sound advice, simply refuse to listen.

The final, and cynical option is that Dratel simply wants to keep getting paid. Ulbricht’s defense is largely funded by donations. Although Roger Ver initially contributed a substantial amount, most subsequent donations have been relatively small. Although a declaration couldn’t be used in court, it would have convicted Ulbricht in the court of public opinion. How many would give money to Ulbricht’s defense if Ulbricht admitted he was the Dread Pirate Roberts?

But in any case, the moment the judge wrote that “Defendant has, however, brought what he must certainly understand is a fatally deficient motion to suppress”, the good ship Revenge was sunk. And this is the point where the defense turned to farce.

The defense, in its opening, presented two theories, that Ulbricht was framed and that the Bitcoins were legitimate. Yet the defense can’t just simply say “my client was framed”, the defense must be able to provide evidence to this effect. Otherwise, this becomes the Chewbacca defense, as any defendant could say “I Wuz Framed” and walk away.

So at that moment, the defense implied that they had some evidence to back these statements, and also gave the prosecution a road map for the remainder of the case.

The prosecution responded by dropping so much evidence as to make the rubble bounce, evidence which was already disclosed to the defense. Rather than just introduce a chat with “Variety Jones” where the Dread Pirate mentions heading into the jungle, they introduces Ulbricht’s Facebook post about his Thai vacation. Rather than just introduce the defendant’s laptop, the prosecution introduced a USB backup from the defendant’s apartment, apparently made two weeks earlier. And don’t forget the scrap of paper with both Silk Road’s rating system and the phone number of Ulbricht’s intended date.

The only 11th hour surprise to the defense involved tracking the Bitcoins. Apparently nobody realized that Bitcoins were trivial to trace. After the defense’s opening, the prosecution scrambled to analyze the wallet.dat files, not only discovering a huge amount of Bitcoins directly from Silk Road to Ulbricht (apparently Ulbricht’s wallets were also the Silk Road “cold” storage) but even sourcing the “hitman” payments as coming from Ulbricht’s wallet!

Now the courts generally frown on 11th hour surprise evidence, having a natural dislike for trial by ambush. Unfortunately for the defense, they invited this ambush in their opening statements.

The materials that underlie the analysis were produced long ago. Based upon the opening statement and based upon one of the theories of the defense, which is that the defendant was a bitcoin trader and that any bitcoins in his possession were from bitcoin trading, it was reasonable to expect that you yourself had done such an analysis and, therefore, that you had some intention of presenting something that would have shown the opposite. In any event, you’ve opened the door to it, and we’re going to proceed. And the fact that the government adjusted and was able to do so is not something that is particularly problematic or unusual. So that’s my ruling on that. -Judge Forrest

So what was the defense to do? Pound the table. And pound it they did.

The defense tried a frankly ridiculous “Karpeles-didit” approach, which was shot down by the judge the next day. Then the defense tried to elicit strange testimony from prosecution witnesses about insanely remote possibilities. The judge was having none of this. If the defense wants to introduce alternate suspects and alternate theories, rather than just triple-hearsay, they would need their own evidence and their own witnesses.

So in a final move, the defense attempted a bit of “trial by ambush”, disclosing two expert witnesses at well beyond the last minute with no details as to the expertise or opinions offered.

Of course, Dratel had to go with the ambush approach: these witnesses could only support the defense’s theories if the prosecution wasn’t prepared. Any Bitcoin expert unwilling to commit perjury would have to acknowledge that direct wallet to wallet transactions are traceable, that Ulbricht’s “legitimate” trading these Bitcoins would require unimaginably good returns, that Ulbricht’s “mining” these Bitcoins is impossible unless he had a room full of nonexistent computers, and that anyone willingly keeping several million in Bitcoin in Silk Road as a “bank” would have been a delusional idiot.

Similarly, if I had to pick a New York area expert to testify for the prosecution about the ridiculousness of the mysterious hacker who somehow managed to both plant evidence 2 weeks before, maintain persistent access, and yet leave no trace in the syslog or other logs, I’d select Steve Bellovin. In short, if the defense properly notified the prosecution, these experts would become tools of the prosecution: one last bounce in the rubble.

But of course, trial by ambush is frowned upon. The judge was particularly scathing, including a full page that basically translates to “this is case law saying you need to get your shit done on time” and such quotes as

Lacking are any expected opinions, lacking are the bases for such opinions. Lacking is any description of analysis or methodology. Lacking also is any indication that Antonopolous has any expertise in the areas in which he seeks to testify. His resume lists that he has worked as a consultant in crypto-currencies and published unnamed “articles” in that area (not a single publication of the alleged group of “200” is listed, let alone information sufficient to assess the seriousness or depth of such articles). Of course, not all consultants are experts.

and

If defense counsel truly planned his trial strategy around his ability to bend the rules and examine witnesses outside of the scope of their direct, then he should have had a “Plan B” that included complying with the rules. Defense counsel took a calculated risk.

In short, there is only one person responsible for the Defense not having their experts: the defense attorney Joshua Dratel.

And with that scathing order, the case pretty much ended. The defense has offered only a few character witnesses and no concrete evidence of the mysterious elves which planted not only the journal on Ulbricht’s computer, but also the mountains of remaining evidence.

Ulbricht received a fair trial. The judge was hard on the defense, but that is largely due to how the defense acted and their strange tactical decisions. The defense threw away the case in October, and then proceeded with farce for the trial.

When all you can do is pound the table, judges sometimes get mad and ask you to stop.