The Price of Spyware: New York Husband Denied Marital Assets Because He “Hacked” the Process

Posted in: Family Law

Under New York law, marital fault must be ignored when allocating the couple’s marital assets or determining whether to award one spouse alimony unless one spouse’s conduct was so bad as to “shock the conscience.” This strict standard has been satisfied only a handful of times in published divorce cases, such as when a man attempted to murder his wife in front of their children or when a man raped his stepdaughter. But what if a man installed secret spyware on his wife’s phone and listened in on private conversations with her lawyer? This might not meet the standard, but a trial court in New York, in Crocker C. v. Anne R., has effectively (and appropriately) bypassed the marital fault rules by denying a spying man the right even to request alimony or the division of assets as a penalty for obfuscating the discovery process and destroying evidence of his misconduct. For this man, a $50 piece of equipment came with a multimillion-dollar price tag.

Crocker C. v. Anna R.: A Divorce the New York Post Writes About

Crocker C., as he’s referred to in the court papers, filed for divorce from his wife, Anne R., in October 2014. The divorce was highly contested and, so far, has included over three years of litigation about custody of the couple’s two minor children, a set of twins who are currently eight years old. The couple has also fought extensively about money. Neither of these facts separates this couple from many others in the midst of a contested divorce. Divorces, as we all know, can be ugly, drawn-out affairs. Because Anne is the heir to a vast tobacco fortune, though, their ugly divorce has made the news on multiple occasions. The New York Post reported in July 2016 that Anne had “lost her battle to block their children from meeting his pregnant girlfriend,” in a proceeding in which she accused him of visiting a brothel.

What might distinguish this couple—or at least relegate it to a smaller subset of ugly divorces—is Anne’s allegation that her husband installed spyware on her iPhone a few weeks prior to filing for divorce and used it to monitor his wife’s communications, including the confidential ones with the lawyer representing her in the divorce. He had the technological power to read her messages in all forms, track her location, and view her call history in real time, a power he allegedly took advantage of between 6 and 59 times a day.

Crocker has refused to answer under oath the question whether he, in fact, engaged in this virtual spying. When asked if he had at a pretrial deposition, he laughed and repeatedly invoked his Fifth Amendment privilege against self-incrimination.

Did He Spy?

As a result of a complicated set of motions and orders, Crocker’s computing devices were given to forensic experts, who were asked to determine the extent, if any, of his spying on his wife’s communications. (The fact that he owned fourteen different devices that could be used to intercept her communications is perhaps a sign of our virtual times.) An expert appointed as a “special referee” by the court issued a report concluding that Crocker did use spyware, did intercept his wife’s confidential communications, and did run “data wiping” programs on at least one device to cover up the evidence of his spying. Indeed, the evidence showed that the spyware was used to listen to a live treatment session between the wife and her psychiatrist and an in-person meeting with her lawyer. On one day when she was meeting with her lawyer, the “audio spy” feature of the device was activated twenty-five different times.

After this report was issued, Anne sought emergency protection from the court to stop Crocker from destroying evidence of his spying. Among other concerns, Anne complained that the spying allowed Crocker to gain an unlawful and unfair advantage in the divorce because he was able to preview her strategy. By this point in the divorce, Crocker was representing himself. In response to the report, Crocker claimed that the peculiar facts he allegedly acquired through spying were actually acquired directly from his wife, who was “usually deeply inebriated” when the couple “had their discussions after the children had gone to bed” and that she perhaps “simply forgot just how forthcoming she was.” So either he engaged in an elaborate scheme to monitor his wife’s every conversation, or she was a chatty drunk.

The Role of Fault in Divorce

What’s the right remedy for Crocker’s bad behavior?

Historically, the entire divorce process was focused on fault. A marriage could not be dissolved because of mere unhappiness. Rather, one spouse had to prove that while she had committed no fault, her husband had committed a specified type of marital misconduct—adultery, cruelty, neglect, or whatever grounds were available in a particular state. New York was a strict state, permitting divorce only on grounds of adultery until the late 1960s.

Because fault was so central to the divorce process, it inevitably affected the consequences of divorce like child custody, the division of marital assets, and alimony. Sometimes, states had specific rules about the way in which fault was supposed to be relevant or irrelevant to these determinations, but it often bled into these determinations whether technically permissible or not.

This entire system gave way eventually to one that either lessened or eliminated the role of marital misconduct. Fault-based divorce was a messy system, which focused arbitrarily on particular bad acts, while inviting perjury, collusion, and show trials. Beginning with California in the late 1960s, states shifted to no-fault divorce, which tried to focus parties and courts on whether a marriage could be saved rather than whether one party committed a specific wrong against the other. Instead, one party had to prove either a substantive standard like “irreconcilable differences”—i.e., this marriage cannot be saved—or a period of separation.

The no-fault revolution did more than alter the grounds for divorce, however. It catalyzed a push to eliminate all discussions of marital fault from the process. Courts began to consider whether and when to eliminate considerations of fault from the economic determinations that take place during a divorce.

Every state today permits consideration of fault when the misconduct has economic consequences for the marriage. Thus, if one spouse has wasted marital assets through gambling or some other form of dissipation, he may get a lesser share of what’s left. Fault can also be considered when it affects the relative economic need of the parties; for example, a wife who has been physically abused and cannot work might be entitled to a greater share of the marital property or an award of alimony.

When the fault is untethered from the economics of the union, states are of different minds about whether and how it can come into play. Some states disallow the consideration of fault for all property and support determinations. Others allow it for property but not alimony, or vice versa. New York, as described above, permits consideration only when the conduct is absolutely egregious. In a case that received a lot of attention, a stockbroker who attempted to murder his stockbroker-wife by smashing her in the head with a barbell was stripped of all but a tiny portion of the couple’s plentiful marital estate.

Back to the Spy Guy: Big Penalty for Virtual Misconduct

Despite living in New York, in which the consideration of fault is rare, Crocker has just been denied any access to spousal support or equitable distribution of assets. But this ruling was not a product of the rules explained above that typically govern the misconduct during marriage or leading up to divorce. Rather, it was the result of rules that prevent spoliation of evidence during divorce and other sorts of misconduct that tip the scales of justice in an unfair way. The court punished Crocker not for his fault against his spouse, per se, but for his fault against the judicial process.

First: the court’s findings. On a complicated and disputed record, the court found that Crocker “installed multiple sophisticated spyware applications on the defendant’s iPhone and that he used that spyware to purloin the defendant’s communications—including hundreds of attorney-client e-mails between her and her counsel in this action—as well as to monitor her physical location using her iPhone’s global position system capabilities, for months in real-time.” Moreover, the court found, Crocker actively used the spyware, gathering information in many forms, enough that he e-mailed the spyware help desk 41 times for assistance in using it. His monitoring of his wife’s communications included, the court found, live eavesdropping on her meetings with her lawyer. The AudioSpy feature allowed him to purposely activate the listening technology when she was meeting with her lawyer by accessing her calendar, also through spy technology. Perhaps the icing on the cake was the clear evidence that Crocker attempted to erase the evidence of his spying. He was successful enough in that endeavor to erase some evidence of his spying efforts, but left behind clear evidence that he was trying to destroy evidence. He engaged in “spoliation of evidence,” a “serious offense against due process and the legal process because it greatly diminishes a party’s ability to obtain justice.”

When asked in multiple proceedings whether he was using spyware, Crocker invoked the Fifth Amendment privilege against self-incrimination, which protects a person from being compelled to give testimony that could be used against him in a criminal case. Nonetheless, the court was left with two questions: (1) whether an adverse inference be drawn against him for invoking the Fifth Amendment; and (2) whether the court can remediate the spoliation of evidence that disrupted the level playing field of divorce litigation.

In short, the court was disturbed that Crocker both came to the court seeking relief—dissolution of an unhappy marriage—and yet “attempted to ‘hack’” the very same litigation and to control its outcome through an unfair advantage. As a litigant, Crocker had an obligation to preserve evidence, especially so given that the court had issued multiple “unambiguous directives” about spoliation.

Under the relevant New York precedents, courts can sanction parties for spoliation of evidence if there was an obligation to preserve evidence, and the spoliation was intentional and in bad faith. And because his destruction of the spyware evidence led to even more violations of his wife’s attorney-client privilege, the court determined that it should draw the “most stringent of adverse inferences against the plaintiff” for asserting his Fifth Amendment right. He refused to incriminate himself in order to continue his unlawful behavior, and his spoliation irreparably prejudiced his litigation opponent (and wife). This led the court to consider the most drastic sanctions for his spoliation of evidence.

As the court summed up Crocker’s situation, “the course of plaintiff’s fate in this litigation has been established by his own considered course of conduct which he had many opportunities to rectify: the full extent of the prejudice against defendant can never be known because the plaintiff engaged in intentional, bad faith spoliation of the key evidence by painstakingly trying to delete all evidence of his wrongful acts by attempting to ‘wipe’ his computing devices of all traces of his spyware usage.” The court was thus justified in presuming “the worst”—that Crocker had indeed intercepted all relevant communications and used the knowledge he acquired to his advantage in litigation. This behavior justified, in the court’s view, the “strongest spoliation sanction available.”

Much like the cases in which New York courts considered whether uniquely egregious facts were sufficient to “shock the conscience” and thus affect the distribution of assets in divorce, this court found Crocker’s behavior unprecedented in a divorce case. The well could not be untainted; Crocker cannot unknow all that he learned by spying. Moreover, the litigation about the spying cost the parties over two million dollars.

Balancing the gravity of Crocker’s behavior and the public policy concerns that underlie all matrimonial cases, especially those involving children, the court settled on a drastic (but appropriate) remedy. It struck Crocker’s pleadings in which he requested financial relief from the record, ruling, in effect, that he could not request a share of any marital assets, an award of spousal support, that are not already in his name or jointly owned and cannot request spousal support. Given that his wife is the heir to a vast tobacco fortune, this ruling might sting. The court wanted just that result; it expressly hoped that others would see this case as a deterrent to this type of misconduct.

The court noted in its conclusion that Crocker’s conduct “both shocks the consciousness of the Court and offends all semblance of judicial integrity.” Let that be a lesson to would-be spies everywhere.

Posted in: Family Law

Tags: alimony, Divorce, Legal