Press release and complaint sworn out by Adobe against speaker.

[Jay D. Dyson]

-----BEGIN PGP SIGNED MESSAGE-----

You know, the more I read on this, the more I'm inclined to boycott
Adobe's PDF products.  The gimps can't provide us with meaningful
protection, so they make an example out of a coder?  To hell with them.

- -Jay

- -----BEGIN FORWARDED MESSAGE-----

U.S. Department of Justice

United States Attorney
Northern District of California

11th Floor, Federal Building
450 Golden Gate Avenue, Box 36055
San Francisco, California  94102

FOR IMMEDIATE RELEASE
 
Tel: (415) 436-7200
Fax: (415) 436-7234


July 17, 2001

The United States Attorney's Office for the Northern District of 
California announced that Dmitry Sklyarov, of Moscow, Russia, made an 
initial appearance yesterday in Las Vegas, Nevada, on a complaint 
from the Northern District of California charging a single count of 
trafficking in a product designed to circumvent copyright protection 
measures in violation of Title 17, United States Code, Section 
1201(b)(1)(A).   This is one of the first prosecutions in the United 
States under this statute, the Digital Millennium Copyright Act 
("DMCA").

According to an affidavit filed by an agent of the Federal Bureau of 
Investigation in connection with the criminal complaint, Mr. Sklyarov 
is alleged to have been the author of a program, "Advanced eBook 
Processor," that unlocked the "eBook Reader" produced by Adobe 
Systems, Inc.  Consumers can download eBook Reader onto their 
personal computers in order to purchase electronic books in the eBook 
format from on-line booksellers such as Amazon.com or 
BarnesandNoble.com.  The eBook Reader permits consumers to read the 
encrypted eBook only on the specific computer utilized to engage in 
the transaction.  Because the book is sold in encrypted form and is 
only accessible through the eBook Reader, the copyright holder's 
interest in the book is protected.

According to the affidavit,  the Advanced eBook Processor permitted 
users of the program to decrypt an eBook in a manner such that the 
eBook could be opened in any Portable Document Format  ("PDF") viewer 
such as Adobe Acrobat reader, and the file would have no restrictions 
on editing, copying and printing the eBook.  The affidavit states 
that the Advanced eBook Processor would allow anyone to read the 
eBook on any computer without paying the fee to the bookseller.  The 
affidavit alleges that the program itself lists Mr. Sklyarov as the 
copyright holder of the Advanced eBook Processor, and that the 
program was distributed by ElcomSoft Company, Ltd. of Moscow, Russia, 
through its website.

The website for the "Defcon-9" conference in Las Vegas, Nevada states 
that Mr. Sklyarov was scheduled to speak at the Defcon-9 conference, 
scheduled for July 13-15.  The Defcon-9 conference website describes 
the conference as "an annual computer underground party for hackers 
in Las Vegas," and it states that Mr. Sklyarov's speech would include 
"security aspects of electronic books and documents."

The maximum statutory penalty for each count in violation of Title 
17, United States Code, Section 1201(b)(1)(A)  is five years 
imprisonment and a fine of $500,000.  However, any sentence following 
conviction would be dictated by the Federal Sentencing Guidelines, 
which take into account a number of factors, and would be imposed in 
the discretion of the Court.  A complaint simply contains allegations 
against an individual and, as with all defendants, Mr. Sklyarov must 
be presumed innocent unless and until convicted.

Mr. Sklyarov made his initial appearance in federal court in Las 
Vegas today, July 16, 2001.  Mr. Sklyarov was detained without bail 
and ordered removed to the Northern District of California. No dates 
have been set for the defendants next appearance.

The prosecution is the result of an investigation by agents of the 
Federal Bureau of Investigation.  Scott Frewing and Joseph Sullivan 
are the Assistant U.S. Attorneys who are prosecuting the case with 
the assistance of Lauri Gomez. 

A copy of this press release and key court documents filed in the 
case may also be found on the U.S. Attorney's Office's website at 
www.usaondca.com.

All press inquiries to the U.S. Attorney's Office should be directed 
to Assistant U.S. Attorney Matthew J. Jacobs at (415) 436-7181.

- ------------------------------------------------------------------------


SEALED BY ORDER
OF THE COURT


United States District Court

NORTHERN DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA

V.

Dmitry Sklyarov	                    	CRIMINAL COMPLAINT

CASE NUMBER 5  01  257


I, the undersigned complainant being duly sworn state the following 
is true and correct to the best of my knowledge and belief. On or 
about June 26, 2001 in Santa Clara county, in the Northern District 
of California defendant(s) did, (Track Statutory Language of Offense)

import, offer to the public, provide, and otherwise traffic in a 
software product that is primarily designed or produced for the 
purpose of circumventing protection afforded by a technological 
measure that effectively protects a right of a copyright owner under 
this title in a work or a portion thereof, and aid and abet such 
conduct.

in violation of Title 17 United States Code, Section(s) 1201(b)(1)(A) 
and 18 U.S.C. Sec.2

I further state that I am a(n) Special Agent, F.B.I. and that this 
complaint is based on the following facts:

see attached affidavit

Penalties:
5 years imprisonment
$500,000 fine
3 years supervised release
$100 penalty assessment

Bail request: no bail

Continued on the attached sheet and made a part hereof  [X]   [  ] No

Approved as to form: [Signature] AUSA Joseph E. Sullivan

Name/Signature of Complainant: [Signature] Daniel J. O'Connell

Sworn to before me and subscribed in my presence

Date: July 7, 2001       at San Jose, California

U.S. Magistrate Judge Patricia V. Trumbull

- ------------------------------------------------------------------------

NORTHERN DISTRICT OF CALIFORNIA     

COUNTY OF SANTA CLARA	)
)
)	SS: AFFIDAVIT FOR COMPLAINT


Daniel J. O'Connell, being duly sworn, deposes and states:

Introduction

1. I submit this affidavit in support of a criminal complaint and an 
arrest warrant for Dmitry Sklyarov, for violation of Title 17, United 
States Code, Section 1201(b)(1)(A) -- circumvention of copyright 
protections, and Title 18, United States Code, Section 2 -- aiding 
and abetting.

2. Title 17, United States Code, Section 1201(b) states in relevant part:

(1) No person shall manufacture, import, offer to the public, 
provide, or otherwise traffic in any technology, product, service, 
device, component, or part thereof, that -

(A) is primarily designed or produced for the purpose of 
circumventing protection afforded by a technological measure that 
effectively protects a right of a copyright owner under this title in 
a work or a portion thereof;

. . .

(2) As used in this subsection -

(A) to "circumvent protection afforded by a technological measure" 
means avoiding, bypassing, removing, deactivating, or otherwise 
impairing a technological measure.

3. Title 17, United States Code, Section 1204, states in part:

(a) In general. -- Any person who violates section 1201 or 1202 
willfully and for purposes of commercial advantage or private 
financial gain,

(1) shall be fined not more than $500,000 or imprisoned for not more 
than 5 years or both, for the first offense; and

(2) shall be fined not more than $1,000,000 or imprisoned for not 
more than 10 years, or both, for any subsequent offense.

Background of Affiant

4. I have been employed as a Special Agent for the Federal Bureau of 
Investigation for over twenty-five years. I am currently assigned to 
the High Tech Squad at San Jose, California, which has responsibility 
for the theft of intellectual property, theft of trade secrets, and 
violations of U.S. copyright laws. I have participated in such 
intellectual property related investigations since passage of the 
Economic Espionage Act of 1996.

Basis of Charges

5. On june 26, 2001, I met with representatives of Adobe Systems, 
Incorporated (Adobe), located in San Jose, California. Kevin 
Nathanson, Group Products Manager, eBooks, Adobe, told me the 
following:

a. Adobe produces computer software, including a software product 
named Adobe eBook Reader.

b. eBook Reader works as follows: after users upload the program onto 
their personal computer systems, the users can contact a Internet Web 
based electronic bookseller such as Amazon.com or Barnes and 
Noble.com and purchase a book titles in an electronic format known as 
an eBook. As a result of a series of seamless transactions taking 
place between the electronic bookseller, an Adobe Server, and the 
customer's computer, users may only open and view the encrypted eBook 
on the specific computer that the user utilized to engage in the 
transaction. Because the process is taking place outside the view or 
control of the user, the user never sees the verification/decryption 
process taking place between the eBook file and the Adobe eBook 
Reader. Nevertheless, because the book sold in encrypted form and 
only accessible through the eBook Reader and is not duplicatable, the 
copyright holder's interest in the book is protected.

c. Adobe is being victimized by a Russian company named Elcomsoft. 
Elcomsoft is distributing a key over the Internet in the form of a 
software program that illegally unlocks copyright protections on the 
e-Book files. This unlocking key is available for purchase on the 
Internet at http://www.elcomsoft.com/aebpr.html. The commercial name 
given by Elcomsoft to this unlocking key program is Advanced eBook 
Processor (AEBPR).

6. Nathanson and Daryl Spano, a technical Investigator, 
Investigations/Anti-Piracy, Adobe, showed me Elcomsoft literature 
they observed on the Internet which describes a program to decrypt 
eBooks in Adobe Acrobat eBook Reader format (PDF files with EBX 
security handler) as well as Adobe Acrobat PDF files protected using 
a standard security method, WebBuy Technology, or any other Acrobat 
security plug-in (like FileOpen, SoftLock etc.). The decrypted file 
can be opened in any PDF viewer (e.g. Adobe Acrobat Reader) without 
any restrictions -- i.e. with edit, copy print, annotate functions 
enabled. All versions of Adobe Acrobat are supported. It can also 
decrypt e-Book Pro (*.EBJ) files, extracting all html pages and 
images from them.

7. Nathanson told me that the real damage done by the AEBPR program 
is that it creates a "naked file" that enables anyone to read the 
eBook on any computer without paying the feed to the bookseller. Only 
one legitimate copy of the encrypted eBook needs to be purchased 
originally and after the protections are stripped through the usage 
of the Elcomsoft program, there are no restrictions and the eBook can 
be duplicated freely and made available for usage on any computer.

8. Daryl Spano told me the following:

a. Adobe purchased a copy of the Elcomsoft unlocking software over 
the Internet, and an Adobe engineer told Spano that the unlocking key 
worked as Elcomsoft claimed.

b. Adobe purchased the program through Elcomsoft through a U.S. based 
company that Elcomsoft was using as a means of collection a $99 fee 
for purchase and usage of the unlocking key. Nathanson and Spano told 
me that this company was Register Now! (www.regnow.com) Dept # 
1170-75, PO Box 1816 Issaquah, Washington 98027, 1-877-353-7297. 
Register Now! collected the $99 fee that pays for the unlocking key. 
Thereafter, Elcomsoft, after receiving verification from Register 
Now!, electronically sent the unlocking key registration code from 
Elcomsoft to the purchaser (Adobe) in San Jose, California, in the 
Northern District of California. Spano provided documents to me 
reflecting the transaction and showing that the unlocking key was 
purchased by Adobe on June 26, 2001.

c. The Elcomsoft unlocking software was downloaded for free directly 
from the Elcomsoft site without purchasing the key. However, the 
software obtained without the unlocking key allowed on to view only 
approximately ten percent of an eBook in the Adobe format. In order 
to get the complete book, the person downloading the Elcomsoft 
software was required to pay Elcomsoft the $99 fee through the RegNow 
website to obtain the unlocking key.

d. A review of the opening screen on the Elcomsoft software purchased 
showed that a person named Dmitry Sklyarov is identified as being the 
copyright holder of the Elcomsoft program. Spano exhibited this 
opening screen to me and provided me with a copy of the screen. Spano 
also provided me a copy of the E-mail from Elcomsoft managing 
director Vladimir Katalov furnishing the unlocking key after the fee 
had been paid to Elcomsoft through the RegNow website.

e. Adobe learned that Dmitry Sklyarov is slated to speak on July 15, 
1001 at a conference entitled Defcon-9 at Las Vegas Nevada. Spano 
told me that he learned that Sklyarov is scheduled to make a 
presentation related to the AEBPR software program.

9. Nathanson told me that thus far, Elcomsoft had defeated ADobe's 
Version 2.1 eBook Reader and has threatened in literature on its 
website to issue a "crack" for Acrobat eBook Reader Version 2.2 that 
has just been released.

10. Nathanson and Spano stated that Adobe has attempted to prevent 
Elcomsoft from providing the unlocking key to the public and has been 
resisted in this effort by Elcomsoft. Adobe has sent "cease and 
desist" letters to Elcomsoft, RegNow and the Internet Service 
Provider for Elcomsoft, Verio Inc.

Independent Investigation

11. On July 2, 2001, I viewed the Internet home page of RegNow, 
"www.regnow.com". The following products were listed for purchase 
through the website:

* Advanced PDF Password Recovery (Pro)

* Recover passwords to Adobe Acrobat PDF files

* ElcomSoft Co. Ltd.

* Advanced PDF Password Recovery

* Decrypt protected ADobe Acrobat PDF files.

* ElcomSoft Co. Ltd.

* Advanced eBook Processor (Discount)

* Decrypt protected Adobe Acrobat PDF files and eBooks

* ElcomSoft Co. Ltd.

When I used a computer mouse to select the above listed programs for 
purchase through RegNow website, I was directed to the home page of 
Elcomsoft.com

12. On July 2 and 3, 2001, I observed the following information on 
the ELCOMSOFT website in which Elcomsoft describes its business 
activity:

"ElcomSoft Co. Ltd. is a privately owned software development company 
headquartered in Moscow, Russia. Established in 1990, Elco 
specializes in producing Windows productivity and utility 
applications for businesses and individuals...." "ElcomSoft Co. Ltd. 
is a member of the Russian Cryptology Association (RCA) and a 
lifetime member of the Association of Shareware Professionals (ASP). 
ElcomSoft is also a Microsoft Independent Software Vendor (ISV) 
partner..."

13. I observed that the Elcomsoft website "home page" showed the 
following information among a listing of new products and their 
release dates:

"June 26, 2001 New versions of Advanced eBook Processor and Advanced 
NT Security Explorer now available" and "June 20, 1001 New product 
has been released: Advanced eBook Processor. Decrypt eBooks for Adobe 
Acrobat Reader and PDF's protected with all security plug-ins, 
including WebBuy!"

14. I observed that Elcomsoft described its product and made certain 
comments about its legality as follows:

Advanced eBook Processor ....

06/20/2001 We have released our new program and called it AEBPR 
(Advanced eBook Processor). The only thing the program does is: 
converting documents from Acrobat eBook format (compiled for Adobe 
Acrobat eBook Reader) to the plain Acrobat format (PDF). Again, 
that's all: from one Adobe format to another. But PDF is much wider 
used, because there are (free) PDF viewers for a lot of hardware 
platforms (from workstations to PDAs) and operating systems (Windows, 
Mac, Linux etc), while Acrobat eBook Reader is available for Windows 
and Mac only.
 
This program works only with eBooks you legally own, i.e. purchased 
from one of online stores like Amazon or Barnes & Noble. So we were 
absolutely sure that the owner of eBook has all rights to read the 
book he purchased where he wants and how he wants.
 
The demo version of AEBPR allowed to convert only first 10% of the 
book content. To protect unauthorized distribution of eBooks on the 
piracy market, we have set the "border" price for this program - $99, 
which is much more than an average eBook cost (most eBooks are being 
sold from $10 to $30, and there are a lot free ones).

You can download a demo version of AEBPR here, here or here (please 
not that current release of our program does not support the latest 
version of Adobe eBook Reader, 2.2; that is the result of unpredicted 
Adobe reaction to our release of this program - see below.
 
06/25/2001 We have received a notification from Adobe Anti-Piracy 
Enforcement Team team in which they claimed that our program is 
illegal and we need to remove it immediately from our site. They said 
they give us 5 days otherwise they will "pursue us aggressively"....
 
06/26/2001 We have received an email from our ISP, Verio Inc. They 
wrote that Adobe has contacted them to shut down our Web site (again, 
immediately). As Adobe wrote to Verio, the reason was: the site 
"offers downloads to their copyrighted software published by Adobe 
Systems." Obviously - this is not true, we never distributed any 
software copyrighted by Adobe Systems. But as you can see, Adobe is 
not even going to collect the correct information (what laws, 
copyrights and terms-of-use have been violated), but just started 
their aggressive actions before 5-day period (they set themselves) 
has expired. Really, they did not want to give us a time to consult 
with our attorneys! Verio gave us 6 hours to remove this page (the 
one you are reading now). So we moved the site to another ISP...
 
06/27/2001 (2:19:30 PM) Verio has contacted us again, this time not 
asking for something, but just with a notification: "Host blocked: 
www.elcomsoft.com/aebpr.html - 198.63.210.56 port 80 (www)" You can 
see, that since they were not able to close our web site completely, 
they simply disabled access to it on their routers. Moreover, they 
have blocked the whole IP address of our server, so not only this 
site, but also lots of other (not only ours) web sites became 
completely out of reach! But we already had a few mirrors ready, and 
after this unfriendly action from Verio, we have updated appropriate 
DNS records. In 6 hours, our web site was accessible again!
 
06/28/2001 (10:57 AM) Adobe has sent a complaint to RegNow , our 
billing service (5 days are still not expired!). This time they 
called it "unauthorized distribution of software"...
 
RegNow asked us for advice what they should do in this situation. We 
didn't want them to be involved in our problems, and so asked to stop 
sales of AEBPR....

07/03/2001 Now it's time for the brutal truth on Adobe eBook 
protection. We claim that ANY eBook protection, based on Acrobat PDF 
format (as Adobe eBook Reader is), is ABSOLUTELY insecure just due to 
the nature of this format and encryption system developed by Adobe. 
The general rule is: if one can open particular PDF file or eBook on 
his computer (does not matter with what kind of 
permissions/restrictions), he can remove that protection (by 
converting that file into "plain", unprotected PDF. Not very much 
experience needed. In brief: ANY security plugin (actually, eBooks 
are protected with security plug-in as well: EBX) does nothing but 
returns a decryption key to Adobe Acrobat Reader or Adobe Acrobat 
eBook Reader. Plug-in can make various hardware verifications, use 
parallel port dongles, connect to the publisher's web site and use 
asymmetric encryption, etc, but all ends up with a decryption key, 
because the Reader needs it to open the files. And when the key is 
there, we can use it to decrypt the document removing all permissions.
 
Below is the list (not complete) of Acrobat-based protections 
supported by Advanced eBook Processor:

* "standard" PDF encryption,
* BPTE_Rot13 (used by New Paradigm Resources Group, Inc.),
* FileOpen (by FileOpen Systems),
* SoftLock (by SoftLock Services, Inc.),
* InterTrust DocBox,
* Internet Standards Australia
* Adobe's Web Buy
* Adobe's eBook Reader (GlassBook Reader)

We claim that by aggressively pushing of standards, unapproved by 
professional cryptologists, to the fast growing electronic books 
market and with pursuing of independent researchers who tries to 
highlight the problems, Adobe Systems violates the rights of books 
authors and publishers, which may result the unauthorised 
distribution of their books in the Internet.

15. On July 2, 2001, I reviewed the website for the "Defcon-9" 
convention scheduled for July 13-15, 2001, in Las Vegas Nevada. I 
observed that an individual identified as Dmitry Sklyarov and an 
individual identified as Andy Malyshev are listed as speakers who are 
to discuss the Acrobat e-Book Reader.

16. The website of Defcon-9 conference described it as follows:

an annual computer underground party for hackers held in Las Vegas, 
Nevada. It has been held every summer for the past eight years. Over 
those years it has grown in size, and attracted people from all over 
the planet. People attend to meet others into hacking, hang out with 
old friends, listen to new speeches or just hack on the network. 
That's what it is all about in a nutshell. Meeting other people and 
learning something new. Last year over 4,200 people showed up. That 
makes us (Currently) the largest hacking convention on the planet.

17. The Defcon-9 website described Dmitry Sklyarov's speech topic as follows:

Dmitry Sklyarov
Andy Malyshev
eBooks security - theory and practice
Security aspects of electronic books and documents, and a 
demonstration of how weak they are: "standard" PDF encryption, Rot13 
(used by New Paradigm Resources Group, Inc.), FileOpen (by FileOpen 
Systems), SoftLock (by SoftLock Services, Inc.), Adobe's Web Buy, 
Adobe's eBook Reader (GlassBook Reader) InterTrust DocBox plug-in.

Documents publishing in electronic form have a lot of advantages 
against traditional on-paper publishing. You could easily find list 
of such advantages on web server of any company, which provides eBook 
solutions. But nobody perfects, and there is one big problem that 
related with eBooks. Information in electronic form could be 
duplicated and transmitted, and there is no reliable way to take 
control over that processes. There are several solutions from 
different companies that were developed to prevent unauthorized 
distribution of the electronic documents.

18. The Defcon 9 website also included the following statement from 
"Dmitry Sklyarov:"

My name is Dmitry Sklyarov. I'm employee of the Elcomsoft Company. As 
we have demonstrated in our speech on Black Hat Win2K Security 
(february 2001), encryption in Microsoft Office documents is very 
weak and password protection may be removed without any problems in 
most cases. In this speech I'll try to cover password protection 
aspects of electronic books and documents. The most attention will be 
paid to documents in PDF format...

19. On July 5, 2001, I spoke via telephone with Tom Diaz, Senior 
Engineering Manager for the eBook Development Group of Adobe. In 
response to my question, Diaz affirmed that he believes the Elcomsoft 
Software program, coupled with the Elcomsoft unlocking key, 
circumvents protection afforded by a technological measure developed 
by Adobe for its Acrobat eBook Reader either by avoiding, bypassing, 
removing, deactiviating, or otherwise impairing the technological 
measure.

Conclusion

20. Based on the foregoing, I believe Dmitry Sklyarov, employee of 
Elcomsoft and the individual listed on the Elcomsoft software 
products as the copyright holder of the program sold and produced by 
Elcomsoft, known as the Advanced eBook Processor, has willfully and 
for financial gain imported, offered to the public, provided, and 
otherwise trafficked in a technology, product, service, and device 
that is primarily designed or produced for the purpose of 
circumvention a technological measure that effectively controls 
access to a work protected under Title 17, namely books distributed 
in a form readable by the Adobe eBook Reader, in violation of Title 
17, United States Code, Section 1201(b)(1)(A) and Title 18, United 
States Code, Section 2.


[Signature]
Daniel J. O'Connell
Special Agent
Federal Bureau of Investigation

Sworn and subscribed before me
this  10  day of July, 2001

Patricia V. Trumbull
United States Magistrate Judge

-----BEGIN PGP SIGNATURE-----
Version: 2.6.2
Comment: See http://www.treachery.net/~jdyson/ for current keys.

iQCVAwUBO1WpS9CClfiU/BIVAQEZ+QP+NxiUdZQgmGfmn8ThnG94C8Cd+rhB/KQz
zPsoIDNwPS63bf9rx+iruWyS7VwYTOwfc+TIGxxE3gSN4wKOgZml3W0CF2iQFbeP
LDXUg3Lrz3WLtyFar1jyjJ3dvd+IzaEusDtAEWNXmuqFCmPEHnIuZcSWSKyGJiop
96+iqRVfgkg=
=di/G
-----END PGP SIGNATURE-----




---------------------------------------------------------------------
The Cryptography Mailing List
Unsubscribe by sending "unsubscribe cryptography" to majordomo at wasabisystems.com