June 22, 2006
New York Times

Technical Glitch Opens Window Into Steroid Leak Case

By ADAM LIPTAK
About eight pages of a 51-page government brief filed in federal court in San Francisco on Wednesday were electronically blacked out to protect what prosecutors said was sensitive material concerning a grand jury's investigation into steroid use in baseball.

But the secret passages can be viewed by simply pasting the document into a word processing program. The passages open a window onto a particularly aggressive government leak investigation, one that seeks to force two San Francisco Chronicle reporters to reveal the identity of a confidential source. They also help explain why prosecutors are pursuing the matter so vigorously.

The glitch was first reported in The New York Sun.

The Chronicle reporters, Mark Fainaru-Wada and Lance Williams, received subpoenas in May seeking their sources for articles that quoted verbatim from grand jury testimony. Wednesday's filing was the government's response to the reporters' motion to quash the subpoenas.

Phil Bronstein, the editor of The Chronicle, said the government might have taken more care to protect the blacked-out passages in light of the nature of its investigation. "It's a little surprising and ironic in this case in particular," Mr. Bronstein said, "that this information which the government filed is somehow available to the public."

Eve Burton, vice president and general counsel of the Hearst Corporation, which owns The Chronicle, said that prosecutors may be guilty of the very thing they are investigating. "It is our hope," she said, "that the government did not leak the document."

The blacked-out passages mostly summarize and quote from e-mail messages between Mr. Fainaru-Wada and one of his sources, and they suggest that the government views the conduct of both with disdain. The source, Victor Conte Jr., was the president of the Bay Area Laboratory Co-Operative, which distributed performance-enhancing drugs to athletes.

In recent remarks at a Berkeley book store, the filing says, Mr. Fainaru-Wada called Mr. Conte a "tempestuous source" with whom he had a "love-hate relationship."

After Mr. Conte's indictment for distributing steroids in February 2004 but before he pleaded guilty and was sentenced to four months in prison last year, Mr. Conte, other defendants in the case and their lawyers were provided with grand jury transcripts so they could prepare their defense. Judge Susan Illston of the Federal District Court in San Francisco issued a protective order that forbade them to disseminating the transcripts. The defendants and their lawyers all signed the order.

The e-mail messages between Mr. Fainaru-Wada and Mr. Conte indicate that the government believes that Mr. Conte provided the transcripts to The Chronicle. Mr. Fainaru-Wada, the filing says, "repeatedly discussed with Conte secret grand jury information and emailed Conte in an attempt to gain access to the grand jury transcripts." The messages were obtained by the government in January 2005 when Federal Bureau of Investigation agents searched Mr. Conte's home.

In a June 18, 2004 e-mail message, Mr. Conte wrote, according to the filing: "I would say at this point the only way the athletes' grand jury testimonies will come out is at trial. Unless I give you a copy of the indexed CD-ROM that contains all 30 thousand pages. How would you like that? Just kidding."

Mr. Fainaru-Wada pursued the matter in a series of email messages over the next several days. "I'm still waiting for that CD-ROM," he wrote on June 20, adding that he was "somewhat reticent to be terribly overt on the e-mail front." The next day, Mr. Fainaru-Wada suggested communicating by "pay phone or cell or even meeting." He added: "As with the CD-ROM, waiting, waiting, waiting."

On June 23, Mr. Fainaru-Wada told Mr. Conte that articles would be published soon. "Hope you like them," he wrote.

The next day, The Chronicle published an article quoting at length from the grand jury testimony of Tim Montgomery, the former Olympic sprinter.

After the article was published, the reporter and his source discussed the legality of the disclosure and whether their earlier e-mail messages contained incriminating information. "If I find something," Mr. Fainaru-Wada wrote on July, "how should I let you know, given your concerns about being watched?"

Ms. Burton, the Hearst lawyer, declined to address the e-mail messages. "We don't comment in any regard on our newsgathering processes," she said.

For his part, Mr. Conte has signed a sworn statement denying he was the source and allowed his lawyers to file papers seeking to dismiss the indictment based on supposed government misconduct. That motion, Wednesday's filing says, may have been "a fraud on the court."

Wednesday's filing contends that the reporters are needed to testify in light of Mr. Conte's denial.

Mary McNamara, a lawyer for Mr. Conte, reiterated his denial, saying: "It is unclear why the government's submission discusses e-mails that plainly prove no breach of the law by Mr. Conte. The government admits that the leaker could be anyone, government personnel included. Indeed, recent disclosures in the Bonds grand jury matter raise serious questions about the government's ability to protect the secrecy that it is charged with maintaining. Mr. Conte is confident that he will ultimately be vindicated in this matter.

A Justice Department spokesman said today that they had no immediate comment on the Wednesday's filing.

The leak investigation in the San Francisco case bears some similarities to that of I. Lewis Libby, Vice President **** Cheney's former chief of staff. In both cases, the investigation of a possibly unlawful disclosure of sensitive information changed its focus to include inquiries into potentially false statements made by a subject of the investigation.

The Chronicle has said that its reporting brought an important issue to public attention. Wednesday's filing disputed that, saying the leaked information added nothing of substance to the indictment in the case and "served only titillate and hold up to public ridicule those athletes who admitted using steroids before the grand jury."

Mr. Bronstein disagreed. "It's very clear that it was not the indictment but the reporting itself that created the national dialogue," he said.