UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF TEXAS
HOUSTON DIVISION

ApolloMedia Corporation ("ApolloMedia") hereby moves the District Court for an order staying Paragraph 7 of Magistrate Judge Marcia A. Crone's June 16, 1999 Order, pending appeal. ApolloMedia believes that it is likely to succeed on the merits of its appeal and irreparable harm to ApolloMedia's First Amendment rights will occur if the Order is not stayed. ApolloMedia also requests that the Court unseal the record in this proceeding.

1. Factual And Procedural Background.

ApolloMedia has appealed from an order that was secretly obtained by the United States (on the basis of a secret application) that is an unconstitutional prior restraint that prohibits ApolloMedia from discussing the existence of the order with anyone.

ApolloMedia is an electronic communications services provider dedicated to providing a forum for free speech through its "annoy.com" web site. Declaration of Clinton Fein, filed herein ("Fein Decl."), 2-4. In addition to enabling others to exercise their First Amendment rights, ApolloMedia and its President, Clinton Fein, regularly exercise their First Amendment rights to comment publicly on newsworthy events. See Motion to Quash 7.9; Fein Decl., 4, 6-8.

In June 1999, ApolloMedia received a telephone call and a fax dated June 16, 1999 from the University of Houston Police Department, regarding a criminal investigation at the University of Houston. Fein Decl., 9. The next day, ApolloMedia received Magistrate Judge Marcia A. Crone's June 16, 1999 Order ("Magistrate's Order"). Fein Decl., 10, Ex. A. The Magistrate's Order required ApolloMedia to produce records pertaining to the sender of certain email messages within three days. ApolloMedia was never served with or allowed to see the Government's application for this order. Fein Decl., 10. In addition to ordering ApolloMedia to produce information, Paragraph 7 of the Magistrate's Order imposed a broad gag order, which prevents ApolloMedia from disclosing the application for the Order, the Order, or the investigation to anyone:

ApolloMedia its agents and affiliates, shall not disclose the existence of the United States' application or this order, or the existence of any investigation, to the listed subscriber or lessee or to any other person (except as necessary to carry out this Order) until authorized to do so by this Court.

Magistrate's Order 7; Fein Decl., Ex. A (emphasis added).

ApolloMedia challenged Paragraph 7 of the Magistrate's Order as an unconstitutional prior restraint on its First Amendment rights. See ApolloMedia's Response to and Motion to Quash Order Under 18 U.S.C. § 2703(d) ("Motion to Quash"), 7.2, 7.9. ApolloMedia also reported to the Magistrate that it did not have any information responsive to the Order. In response, Magistrate Judge Crone issued an order dismissing ApolloMedia's motion as moot. Order, dated August 13, 1999. On September 1, 1999 Judge Lynn H. Hughes affirmed the Magistrate Judge Crone's order dismissing ApolloMedia's Motion to Quash as moot. Order, dated September 1, 1999. ApolloMedia has filed notices of appeal from the Magistrate's Order as well as from the District Court's order of September 1, 1999.

Despite the fact that the Magistrate Judge Crone and District Judge Hughes have dismissed ApolloMedia's motion to quash as moot, Paragraph 7 of the Magistrate's Order remains in effect and unconstitutionally prohibits ApolloMedia from discussing the order with anyone.

2. The Court Should Grant A Stay Of Paragraph 7 Of The Appealed Order.

1. Standard for Granting a Motion to Stay

The factors for evaluating whether a stay should be granted pending appeal are well established in the Fifth Circuit:

(1) Whether the movant has made a showing of likelihood of success on the merits;

(2) Whether the movant has made a showing of irreparable injury if the stay is not granted;

(3) Whether the granting of the stay would substantially harm the other parties; and

(4) Whether the granting of the stay would serve the public interest.

See In re First South Sav. Ass'n, 820 F.2d 700, 704 (5th Cir. 1987) (citing Ruiz v. Estelle, 666 F.2d 854, 856 (5th Cir. 1982)). Moreover, "the movant need not always show a 'probability' of success on the merits; instead, the movant need only present a substantial case on the merits when a serious legal question is involved and show that the balance of the equities weighs heavily in favor of granting the stay." Ruiz v. Estelle, 650 F.2d 555, 565 (5th Cir. Unit A Jun. 1981), quoted in First South Sav. Ass'n, 820 F.2d at 704.

2. ApolloMedia has a Substantial Likelihood of Success on the Merits.

1. The Magistrate's Order Was Not Moot Because the Gag Order in Paragraph 7 Remains in Effect.

The unconstitutional prior restraint in Paragraph 7 of the Magistrate's Order remains in effect. The plain language of Paragraph 7 prevents ApolloMedia, its agents, and affiliates from discussing the order with "any ... person ... until authorized to do so" by the Court. As of this date of filing this instant motion, the Court has not taken any action to lift the constraints contained in Paragraph 7. Neither Magistrate Judge Crone's August 16, 1999 Order nor Judge Hughes's September 1, 1999 Order addresses the restraints contained in Paragraph 7. Accordingly, this matter is not moot, even though ApolloMedia complied with the subpoena, because ApolloMedia's acts are still restricted by the Magistrate's Order. See Procter & Gamble Co. v. Bankers Trust Co., 78 F.3d 219, 222 (6th Cir. 1996) (case is not moot because permanent injunction remains in effect).

2. Paragraph 7 of the Magistrate's Order Constitutes an Unconstitutional Prior Restraint of ApolloMedia's First Amendment Rights

Paragraph 7 of the June 16, 1999 Order constitutes an unconstitutional prior restraint of speech protected by the First Amendment. See New York Times v. United States, 403 U.S. 713, 714 (1971) (impermissible prior restraint against publication of Pentagon Papers even though majority of the justices believed that publication would probably be harmful to national security; any prior restraint bears "a heavy presumption against its constitutional validity"); Nebraska Press Ass'n v. Stuart, 427 U.S. 539, 559 ("prior restraints on speech and publication are the most serious and the least tolerable infringement on First Amendment rights"); Landmark Communications, Inc. v. Virginia, 435 U.S. 829, 844-45 (1978) ("this Court has consistently rejected the argument that [out-of-court statements on pending cases or grand jury investigations] constituted a clear and present danger to the administration of justice"); Worrel Newspapers of Indiana v. Westhafer, 739 F.2d 1219, 1224-1225 (7th Cir. 1984), affirmed, 469 U.S. 1200 (1985) (holding unconstitutional a state statute subjecting to criminal punishment any person who published names of persons against whom a sealed indictment or information was filed); Procter & Gamble, 78 F.3d at 225 ("gagging of publication has been considered acceptable only in 'exceptional cases'").

3. ApolloMedia and Its President Clinton Fein Will Suffer Irreparable Harm To Its First Amendment Rights If A Stay Is Not Granted

Paragraph 7 of the Magistrate's Order has prevented and will continue to prevent ApolloMedia, its agents, and affiliates - including ApolloMedia's President Clinton Fein - from discussing the Order with anyone. The unconstitutional restraint of their First Amendment rights wrought by Paragraph 7 causes them continuing and irreparable harm. Fein Decl., 13, 17. See Elrod v. Burns, 427 U.S. 347, 373-74 (1976) ("The loss of First Amendment freedoms, for even minimal periods of time, unquestionably constitutes irreparable injury").

The First Amendment injury is especially grave in this instance because both ApolloMedia and Mr. Fein are prominent proponents of issues related to freedom of speech and privacy on the Internet. The case of Nebraska Press Assn. v. Stuart, 427 U.S. 1327 (1976) is instructive. There, Justice Blackmun, in granting an emergency motion to stay an injunction that created a prior restraint of free speech, poignantly observed:

Where ... a direct prior restraint is imposed upon the reporting of news by the media, each passing day may constitute a separate and cognizable infringement of the First Amendment. The suppressed information grows older. Other events crowd upon it. To this extent, any First Amendment infringement that occurs with each passing day is irreparable.

Id. at 1329. See also CBS, Inc. v. Davis, 510 U.S. 1315, 1317 (1995)(opinion of Blackmun, J., in chambers, quoting Nebraska Press Assn. and granting emergency motion to stay).

ApolloMedia is a multimedia company which - in addition to its private Internet consulting work - operates the "annoy.com" web site as a forum for free speech and the free exchange of ideas over the Internet. Fein Decl., 3, 4. In 1997, ApolloMedia challenged the constitutionality of certain aspects of the Communications Decency Act which ApolloMedia believed placed unconstitutional limitations on freedom of speech. Fein Decl., 5. Besides serving as President of ApolloMedia, Mr. Fein is a prominent spokesperson on issues related to speech and privacy on the Internet and is frequently called upon to express his and policy views in the public media. Fein Decl., 6-8. The circumstances surrounding the issuance of the Magistrate's Order, the procedural basis for the Order, and the restrictions of free speech contained in Paragraph 7 of the Order are newsworthy and directly relate to ApolloMedia's and Mr. Fein's work. Fein Decl., 4, 12-16.

4. The Granting Of A Stay Would Serve The Public Interest.

By the same token that Paragraph 7 of the Magistrate's Order speech harms ApolloMedia, it harms the public interest. Visitors to the annoy.com web site and the general public have the right to be informed of the manner in which the United States and local law enforcement agencies are using the courts to attempt to secretly enlist web sites such as annoy.com to invade the privacy of users of the Internet.

3. This Court Should Unseal the Record.

The shroud of secrecy that has surrounded the Magistrate's Order should be lifted. This Court should unseal the entire record, including the government's application for the Magistrate's Order. Both private and public interests favor unsealing the record. ApolloMedia's lack of access to the entire record handicaps its ability to make a complete argument on the merits of its challenge to Paragraph 7. More fundamentally, the sealing order is inimical to the public's (including ApolloMedia's) interest in open court proceedings and the common-law right of access to judicial records. See Nixon v. Warner Communications, 435 U.S. 589, 55 L. Ed. 2d 570, 98 S. Ct. 1306 (1978) (recognizing a "general right to inspect and copy public records and documents"); Leucadia, Inc. v. Applied Extrusion Tech., Inc., 998 F.2d 157, 161 (3d Cir. 1993)(stating that common law right of access, recognized in Nixon, applies to civil and criminal judicial proceedings and to pretrial proceedings); Smith v. United States District Court, 956 F.2d 647, 650 (7th Cir. 1992)(same).

Dated: August 31, 2000

SUSMAN GODFREY LLP

MARK L.D. WAWRO

1000 Louisiana Street
Suite 5100
Houston, TX 77002-5096
Telephone: (713) 651-9366
Facsimile: (713) 653-7897

 COOLEY GODWARD LLP

MICHAEL TRAYNOR

One Maritime Plaza, 20th Floor
San Francisco, CA 94111-3580
Telephone: (415) 693-2000
Facsimile: (415) 951-3699

 ROGERS JOSEPH O'DONNELL & QUINN

WILLIAM BENNETT TURNER

311 California Street, 10^th Floor
San Francisco, CA 94104-2602
Telephone: (415) 956-2828
Facsimile: (415) 956-6457

Attorneys for ApolloMedia Corporation