A federal court has denied a motion from defendants in a fraud case to preserve digital evidence, ruling that the government's retention of the data violated the Fourth Amendment. The case, United States v. Swati, involves multiple defendants charged with conspiracy to commit wire and mail fraud. The ruling affects how digital evidence is handled in future cases, particularly regarding the government's obligations to disclose evidence.
The court's decision comes after the government seized 23 terabytes of digital evidence from the defendants' properties in June 2021. The defendants argued that the government had a duty to preserve and search this evidence under the Brady v. Maryland ruling, which requires the prosecution to disclose exculpatory evidence. However, the court found that the government's delay in reviewing the evidence constituted an unlawful seizure.
Background
The defendants in this case, including Erland Olson and others, were indicted on March 13, 2025, for conspiracy to commit wire and mail fraud. The government executed search warrants at Olson's residence in Albuquerque, New Mexico, and at Theia's headquarters in Washington, D.C., seizing numerous digital devices. These actions resulted in a substantial amount of digital evidence being collected.
After the seizures, the government failed to review the evidence promptly to determine which materials fell within the scope of the warrants. Instead, the evidence remained largely unprocessed for years, raising concerns among the defendants about their right to access potentially exculpatory information. In April 2026, the government indicated plans to transfer the data to a creditor of Theia and delete it from its systems, prompting the defendants to file a motion to preserve the evidence.
The Ruling
Judge Royce C. Lamberth presided over the case and ruled against the defendants' motion to preserve the digital evidence. The court stated that the government's ongoing retention of the unscoped data was unreasonable under the Fourth Amendment, which protects against unlawful searches and seizures. The judge noted, "The government’s ongoing seizure of electronically stored information that is not responsive to the warrant is unreasonable under the Fourth Amendment."
The court highlighted that the government had not acted expeditiously in segregating the responsive materials from the non-responsive ones, leading to an unlawful seizure of data. The judge explained that the government had two options: cease the seizure or secure a new warrant. Since the government chose to cease the seizure, the court could not compel it to continue retaining the evidence.
Impact
This ruling has significant implications for how digital evidence is managed in criminal cases. It underscores the importance of timely reviewing and processing evidence collected during searches. The court's decision reinforces the notion that the government must act reasonably when handling electronic data, particularly given the vast amounts of information stored on digital devices.
The outcome of this case may influence future cases, particularly those involving electronic evidence. It establishes a precedent that delays in reviewing and segregating digital evidence can lead to violations of defendants' rights under the Fourth Amendment. This ruling could also affect how prosecutors approach their obligations under Brady v. Maryland, as they must ensure that they do not retain evidence unlawfully.
What's Next
While the defendants cannot appeal this ruling directly, they may explore other legal avenues, such as filing subpoenas to obtain evidence from third parties. The court indicated that the defendants could potentially subpoena Brevet, the creditor involved, to ensure that any responsive evidence is preserved. This case highlights the ongoing challenges in balancing law enforcement's needs with individuals' rights in the digital age.