1 June 1998

Date: Mon, 01 Jun 1998 09:50:46 -0400
To: cypherpunks@algebra.com
From: Will Rodger <rodger@worldnet.att.net>
Subject: Freeh, Gates, Barksdale, McNealy to huddle on encryption

The meeting below has been conveniently sandwiched between EPIC's excellent
encryption conference June 8 and the Business Software Alliance's CEO Forum
June 10. It will doubtless generate plenty of conversation at coffee


Tech execs will meet with the FBI over crypto
 By Will Rodger
Inter@ctive Week Online
June 1, 1998 4:26 AM PDT

Tech execs will meet with the FBI over crypto Top executives from some of
the world's largest computer hardware and software companies will meet with
FBI Director Louis Freeh and Sen. Dianne Feinstein, D-Calif., on June 9 to
discuss their differences over continuing government limitations over
powerful data-scrambling technology.

Though a final list of attendees remains in flux, Microsoft Corp. (MSFT)

Chairman Bill Gates, Netscape Communications Corp. (NSCP) CEO James
Barksdale, America Online Inc. (AOL) Chairman Steve Case, AT&T Corp. (T)
CEO C. Michael Armstrong, Sun Microsystems Inc. (SUNW) Chairman and CEO
Scott McNealy and MCI Communications Corp. (MCIC) President Timothy Price
are all expected to attend.

Officials were careful not to term the meeting a negotiation, but the event
marks a watershed in the encryption debate: Never before have top
executives from major suppliers of encryption technology met directly with
the FBI, their main nemesis in a fight that has dragged on for more than
five years in the nation's capital.

The issues at stake, however, remain the same.

Information technology executives are expected to tell Freeh that their
future viability demands strong data-scrambling equipment to keep bank
transactions, medical records, children's e-mail and a whole host of other
sensitive data secure on the Internet.

Freeh, in turn, will argue law enforcement's view of encryption: That
encryption's ability to encode data and phone calls threatens wiretapping
capabilities that law enforcement desperately wants to preserve.

He is expected to repeat his demand that all encryption technologies
include technical back doors so that police can read the encoded messages
with spare "keys" available through court order or other lawful access.

Easy target

Industry and civil libertarians have rejected that approach, warning that
such an arrangement threatens not only abuse by rogue cops but the creation
of key repositories which would prove irresistible targets to commercially
and politically motivated spies and saboteurs.

Given the United States' dependence on computer networks for finance,
medicine, utilities and other services, many security experts have
condemned the plan as irresponsible on its face.

"Feinstein's agenda is if the CEOs hear only what Louis Freeh has to say,
then somehow they'll agree with him," said Peter Harter, policy counsel to
Netscape Communications Corp. "I appreciate what she's doing, but I know
there's still reluctance on the part of some of the CEOs." Netscape's
Barksdale had agreed to attend nonetheless, Harter said.

FBI Special Agent Charles Barry Smith said Freeh was eager to meet with the
CEOs, but seemed to distance his boss from the encounter. "This is a
meeting Sen. Feinstein arranged." Smith said. "We're just participants in

Industry executives said the meeting is evidently in response to a letter
delivered to Feinstein's office last March in which Silicon Valley
executives told her they opposed current administration policy on
encryption exports as well as FBI attempts to control domestic use of the

Prior to the letter, Feinstein had said she had heard nothing from her own
state's Silicon Valley on the issue -- a contention that drew anger in
high-tech circles when it was made.

Feinstein on FBI's side 

Feinstein last year came out in support of the FBI's demand for controls on
encryption worldwide. Current law controls export, but not domestic use, of

Companies and activists alike have increased the pressure on Feinstein and
her supporters since.

The recently formed Americans for Computer Privacy, for instance, elicited
the support of Senate Judiciary members Sen. John Ashcroft, R-Mo., and Sen.
Patrick Leahy, D-Vt., in drafting recent legislation that would guarantee
Americans' right to use strong encryption at will while lifting nearly all
restrictions on export of the technology abroad.

At the same time, the bill also penalizes use of encryption in commission
of a crime and set up a research center for law enforcement to study ways
to attempt to break encrypted messages.

Civil libertarians have fought the last two provisions, saying they can
only cast legitimate use of encryption technology in an unfavorable light
while inviting spy agencies skilled in encryption such as the National
Security Agency into domestic affairs.

Notably absent from the list of invitees: public interest groups who could
argue for civil liberties without being subject to pressures companies may
feel from an unfriendly bureaucracy.

Little hope for liberalization 

Activists said they saw little hope for liberalization as a result of the

"The only thing that can come out of this is the industry will cave into
FBI pressure and will act contrary to the interests of the American public
but in their own interest," Electronic Frontier Foundation Executive
Director Barry Steinhardt said. "It's hard to imagine the FBI is going to
back off because Bill Gates or Jim Barksdale is in the room."

Some industry lobbyists expressed misgivings as well. "They're going to get
the scare speech," said one association executive who spoke only on the
condition of anonymity. "When the next bomb goes off, they're going to be

Sen. Feinstein's office failed to respond to repeated requests for an

Will Rodger                         Voice: +1 202-408-7027 
Washington Bureau Chief             Fax: +1 202-789-2036
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