High Court Upholds Exec Hacker Convictions

(CN) - The U.S. Supreme Court on Monday affirmed the felony convictions of a former executive with a technology firm who unlawfully hacked his employer's computers to steal information he then used to start his own company.

Michael Musacchio, the former president of Exel Transportation Services, was convicted in May 2013 of one felony county of conspiracy to make unauthorized access to a protected computer and two felony counts of hacking.

At trial, prosecutors had said that Musacchio, with the aid of two other former Exel employees, hacked into Exel's computer system and raided its email accounts to steal confidential and proprietary business information from 2004 through 2006.

Exel discovered the scheme when an agent with whom it was negotiating a new contract revealed that one of Musacchio's conspirators showed him an undisclosed contract addendum.

Musacchio was sentenced to 63 months in prison. On appeal, he argued the jury received the erroneous instruction that it had to find proof that he had accessed a private computer without authorization and exceeded his authored access.

By including both elements in the jury instruction, the court made that the law of the case, and the government failed to prove he exceeded access, Musacchio said.

He also argued, for the first time, that his prosecution for unauthorized access to his former employer's computers was time-barred by the 5-year statute of limitations because the superseding indictment was filed seven years after the crime and did not related back to the timely original indictment.

The Fifth Circuit rejected both challenges and affirmed Musacchio's conviction, holding that a sufficiency challenge must be directed at the elements of a charged count, not erroneous jury instruction.

It also held that by not raising the statute of limitations issue at trial, Musacchio had waited his right to that defense.

Musacchio appealed the case to the Supreme Court, which agreed to take up but the sufficiency and statute of limitations issues.

On Monday, a unanimous Supreme Court held that the Fifth Circuit correctly rejected Musacchio's sufficiency challenge, and also found the former executive effectively waived his right to a statute-of-limitations defense by not raising it at trial.

On the first issue, Justice Clarence Thomas wrote that, "when a jury instruction sets forth all the elements of the charged crime but incorrectly adds one more element, a sufficiency challenge should be assessed against the elements of the charged crime, not against the erroneously heightened command in the jury instruction."

"The Government's failure to introduce evidence of an additional element does not implicate the principles that sufficiency review protects. All that a defendant is entitled to on a sufficiency challenge is for the court to make a 'legal' determination whether the evidence was strong enough to reach a jury at all," Thomas wrote.

He then turned to the issue Musacchio raised regarding the statute of limitations.

He noted that when a defendant introduces a limitation defense into the case, the government has a right to reply or provide evidence on the limitations claim.

"The failure to raise it at or before trial means that it is renewable on appeal if at all only for plain effort," Thomas wrote.

"[A] statute-of-limitations defense becomes part of a case only if the defendant puts the defense in issue," he continued. "When a defendant presses a limitations defense, the Government then bears the burden of establishing compliance with the statute of limitations by presenting evidence that the crime was committed within the limitations period or by establishing an exception to the limitations period.

"When a defendant fails to press a limitations defense, the defense does not become part of the case and the Government does not otherwise have the burden of proving that it filed a timely indictment," Thomas wrote. "When a defendant does not press the defense, then, there is no error for an appellate court to correct - and certainly no plain error.

"A defendant thus cannot successfully raise the statute-of-limitations defense ... for the first time on appeal. The Fifth Circuit correctly refused to consider Musacchio's limitations defense here," the opinion stated.

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