529 F.3d 892 (9th Cir. 2008), 07-55282, Quon v. Arch Wireless Operating Co., Inc.

Docket Nº:07-55282.
Citation:529 F.3d 892
Party Name:Jerilyn QUON; April Florio; Jeff Quon; Steve Trujillo, Plaintiffs-Appellants, v. ARCH WIRELESS OPERATING COMPANY, INCORPORATED, a Delaware corporation; City of Ontario, a municipal corporation; Lloyd Scharf, individually and as Chief of Ontario Police Department; Ontario Police Department; Debbie Glenn, individually and as a Sergeant of Ontario Pol
Case Date:June 18, 2008
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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529 F.3d 892 (9th Cir. 2008)

Jerilyn QUON; April Florio; Jeff Quon; Steve Trujillo, Plaintiffs-Appellants,

v.

ARCH WIRELESS OPERATING COMPANY, INCORPORATED, a Delaware corporation; City of Ontario, a municipal corporation; Lloyd Scharf, individually and as Chief of Ontario Police Department; Ontario Police Department; Debbie Glenn, individually and as a Sergeant of Ontario Police Department, Defendants-Appellees.

No. 07-55282.

United States Court of Appeals, Ninth Circuit.

June 18, 2008

Argued and Submitted Feb. 6, 2008.

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Dieter C. Dammeier , Zahra Khoury , Lackie & Dammeier APC, Upland, CA, for the plaintiffs-appellants.

Dimitrios C. Rinos , Rinos & Martin, LLP, Tustin, CA; Kent L. Richland , Kent J. Bullard , Greines, Martin, Stein & Richland LLP, Los Angeles, CA, for defendants-appellees City of Ontario, Ontario Police Department, and Lloyd Scharf.

Bruce E. Disenhouse , Kinkle, Rodiger and Spriggs, Riverside, CA, for defendant-appellee Debbie Glenn.

John H. Horwitz , Schaffer, Lax, McNaughton & Chen, Los Angeles, CA, for defendant-appellee Arch Wireless, Inc.

Appeal from the United States District Court for the Central District of California; Stephen G. Larson , District Judge, Presiding. D.C. No. CV-03-00199-SGL.

Before: HARRY PREGERSON and KIM McLANE WARDLAW , Circuit Judges, and RONALD B. LEIGHTON ,[*] District Judge.

WARDLAW , Circuit Judge:

This case arises from the Ontario Police Department's review of text messages sent and received by Jeff Quon, a Sergeant and member of the City of Ontario's SWAT team. We must decide whether (1) Arch Wireless Operating Company Inc., the company with whom the City contracted for text messaging services, violated the Stored Communications Act, 18 U.S.C. §§ 2701 -2711 (1986) ; and (2) whether the City, the Police Department, and Ontario Police Chief Lloyd Scharf violated Quon's rights and the rights of those with whom he “texted" -Sergeant Steve Trujillo, Dispatcher April Florio, and his wife Jerilyn Quon 1 -under the Fourth Amendment to the United States Constitution and Article I, Section 1 of the California Constitution.

I. FACTUAL BACKGROUND

On October 24, 2001, Arch Wireless (“Arch Wireless" ) contracted to provide wireless text-messaging services for the City of Ontario. The City received twenty two-way alphanumeric pagers, which it distributed to its employees, including Ontario Police Department (“OPD" or “Department" ) Sergeants Quon and Trujillo, in late 2001 or early 2002.

According to Steven Niekamp, Director of Information Technology for Arch Wireless:

A text message originating from an Arch Wireless two-way alphanumeric text-messaging pager is sent to another two-way text-messaging pager as follows: The message leaves the originating pager via a radio frequency transmission. That transmission is received by any one of many receiving stations, which are owned by Arch Wireless. Depending on the location of the receiving station, the message is then entered into the Arch Wireless computer network either by wire transmission or via satellite by another radio frequency transmission.

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Once in the Arch Wireless computer network, the message is sent to the Arch Wireless computer server. Once in the server, a copy of the message is archived. The message is also stored in the server system, for a period of up to 72 hours, until the recipient pager is ready to receive delivery of the text message. The recipient pager is ready to receive delivery of a message when it is both activated and located in an Arch Wireless service area. Once the recipient pager is able to receive delivery of the text message, the Arch Wireless server retrieves the stored message and sends it, via wire or radio frequency transmission, to the transmitting station closest to the recipient pager. The transmitting stations are owed [sic] by Arch Wireless. The message is then sent from the transmitting station, via a radio frequency transmission, to the recipient pager where it can be read by the user of the recipient pager.

The City had no official policy directed to text-messaging by use of the pagers. However, the City did have a general “Computer Usage, Internet and E-mail Policy" (the “Policy" ) applicable to all employees. The Policy stated that “[t]he use of City-owned computers and all associated equipment, software, programs, networks, Internet, e-mail and other systems operating on these computers is limited to City of Ontario related business. The use of these tools for personal benefit is a significant violation of City of Ontario Policy." The Policy also provided:

C. Access to all sites on the Internet is recorded and will be periodically reviewed by the City. The City of Ontario reserves the right to monitor and log all network activity including e-mail and Internet use, with or without notice. Users should have no expectation of privacy or confidentiality when using these resources.

D. Access to the Internet and the e-mail system is not confidential; and information produced either in hard copy or in electronic form is considered City property. As such, these systems should not be used for personal or confidential communications. Deletion of e-mail or other electronic information may not fully delete the information from the system.

E. The use of inappropriate, derogatory, obscene, suggestive, defamatory, or harassing language in the e-mail system will not be tolerated.

In 2000, before the City acquired the pagers, both Quon and Trujillo had signed an “Employee Acknowledgment," which borrowed language from the general Policy, indicating that they had “read and fully understand the City of Ontario's Computer Usage, Internet and E-mail policy." The Employee Acknowledgment, among other things, states that “[t]he City of Ontario reserves the right to monitor and log all network activity including e-mail and Internet use, with or without notice," and that “[u]sers should have no expectation of privacy or confidentiality when using these resources." Two years later, on April 18, 2002, Quon attended a meeting during which Lieutenant Steve Duke, a Commander with the Ontario Police Department's Administration Bureau, informed all present that the pager messages “were considered e-mail, and that those messages would fall under the City's policy as public information and eligible for auditing." Quon “vaguely recalled attending" this meeting, but did not recall Lieutenant Duke stating at the meeting that use of the pagers was governed by the City's Policy.

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Although the City had no official policy expressly governing use of the pagers, the City did have an informal policy governing their use. Under the City's contract with Arch Wireless, each pager was allotted 25,000 characters, after which the City was required to pay overage charges. Lieutenant Duke “was in charge of the purchasing contract" and responsible for procuring payment for overages. He stated that “[t]he practice was, if there was overage, that the employee would pay for the overage that the City had.... [W]e would usually call the employee and say, ‘Hey, look, you're over X amount of characters. It comes out to X amount of dollars. Can you write me a check for your overage[?]’ "

The informal policy governing use of the pagers came to light during the Internal Affairs investigation, which took place after Lieutenant Duke grew weary of his role as bill collector. In a July 2, 2003 memorandum entitled “Internal Affairs Investigation of Jeffery Quon," (the “McMahon Memorandum" ) OPD Sergeant Patrick McMahon wrote that upon interviewing Lieutenant Duke, he learned that early on

Lieutenant Duke went to Sergeant Quon and told him the City issued two-way pagers were considered e-mail and could be audited. He told Sergeant Quon it was not his intent to audit employee's [sic] text messages to see if the overage is due to work related transmissions. He advised Sergeant Quon he could reimburse the City for the overage so he would not have to audit the transmission and see how many messages were non-work related. Lieutenant Duke told Sergeant Quon he is doing this because if anybody wished to challenge their overage, he could audit the text transmissions to verify how many were non-work related. Lieutenant Duke added the text messages were considered public records and could be audited at any time.

For the most part, Lieutenant Duke agreed with McMahon's characterization of what he said during his interview. Later, however, during his deposition, Lieutenant Duke recalled the interaction as follows:

I think what I told Quon was that he had to pay for his overage, that I did not want to determine if the overage was personal or business unless they wanted me to, because if they said, “It's all business, I'm not paying for it," then I would do an audit to confirm that. And I didn't want to get into the bill collecting thing, so he needed to pay for his personal messages so we didn't-pay for the overage so we didn't do the audit. And he needed to cut down on his transmissions.

According to the McMahon Memorandum, Quon remembered the interaction differently. When asked “if he ever recalled a discussion with Lieutenant Duke that if his text-pager went over, his messages would be audited ... Sergeant Quon said, ‘No. In fact he [Lieutenant Duke] said the other, if you don't want us to read it, pay the overage fee.’ "

Quon went over the monthly character limit “three or four times" and paid the City for the overages. Each time, “Lieutenant Duke would come and tell [him] that[he] owed X amount of dollars because [he] went over [his] allotted characters." Each of...

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