Petition for Writ of Certiorari — Dow Chemical Co. v. United States

IN THE

Supreme Court of the United States

—

October Term, 1984

—

THE DOW CHEMICAL COMPANY,

Petitioner,

versus

UNITED STATES OF AMERICA

BY AND THROUGH ADMINISTRATOR,

ENVIRONMENTAL PROTECTION AGENCY,

Respondent.

—

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

- AND APPENDIX -

—— Sa

JANE M. GOOTEE, Esq.

Counsel of Record

BERNDT W. SANDT, Esq.

THE DOW CHEMICAL COMPANY

1111 Washington Street

Midland, Michigan 48674

(517) 636-2663

Counsel for Petitioner

Interstate Brief & Record Co., Suite 731, David Whitney Building, Detroit, MI 48226

(313) 962-8745

i

QUESTIONS PRESENTED

I.

HAS THIS COURT’S DECISION IN OLIVER v. UNITED

STATES, — U.S. —, 80 L.Ed.2d 214 (1984), WHICH HELD

AN AGRICULTURAL FIELD TO BE AN “OPEN FIFLD”,

MODIFIED EARLIER HOLDINGS OF THIS COURT TO SUCH

AN EXTENT THAT A HIGHLY SECURED YET OPEN-AIR

MANUFACTURING FACILITY IS AN “OPEN FIELD” WITH

NO REASONABLE EXPECTATION OF PRIVACY IN THE

MINUTE DETAILS OF ITS COMPLEX PLANT FROM THE

INTRUSIVE, VISUALLY AIDED SURVEILLANCE FROM THE

AIR?

Il.

DOES SUBSECTION 114(a) OF THE CLEAN AIR ACT

AUTHORIZE THE ENVIRONMENTAL PROTECTION

AGENCY TO UTILIZE AERIAL RECONNAISSANCE PHOTO-

GRAPHY AS A SITE INSPECTION TECHNIQUE?

TABLE OF CONTENTS

Page

QUESTIONS PRESENTED ................. i

TABLE OF AUTHORITIES ................. iv

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

oe le) ee 1

Es ars n.d 04 00 9 0:0 b owe se 4 1

CE SENS bp abcess ccesecsseess 2

CONSTITUTIONAL AND

- STATUTORY PROVISIONS ............... 2

STATEMENT OF THE CASE ............... 4

REASONS FOR GRANTING THE WRIT ........ 7

I. THE DECISION IS INCONSISTENT WITH THIS

COURT’S OPINIONS IN OLIVER v. UNITED

STATES, 80 L.Ed.2d 214 (1984); MARSHALL v.

BARLOW’S INC., 436 U.S. 307 (1978); AIR POL-

LUTION VARIANCE BOARD v. WESTERN AL-

FALFA CORPORATION, 416 U.S. 861 (1974); AND

KATZ v. UNITED STATES, 389 U.S. 347 (1967) . . 9

A. Detailed Aerial Photography Versus Mere

Aerial Observation............... 10

B. A Secured, Developed Industrial Facility

Is Not An Open Field ............ 11

C. The Open Fields Doctrine Has Limited,

If Any, Application To Cases Where

Sophisticated, Intrusive Surveillance De-

vices Are Employed To Seek Evidence

Without Consent Or Judicial Authority. . 12

iv

Page

Il. SECTION 114(a) OF THE CLEAN AIR ACT DOES

NOT AUTHORIZE, EITHER EXPLICITLY OR BY

LACK OF PROHIBITION, THE USE OF AERIAL

PHOTOGRAPHY AS AN _ INVESTIGATION

TOG £65505 46 554 ea 14

A. The Decision Is Inconsistent With Con-

gressional Intent As Shown By The Plain

Meaning Of The Statutory Language .. 15

B. The Decision Is Inconsistent With The

Clean Air Act’s Provision Protecting

Trade Secrets And With Existing Tort

And Criminal Law............... 16

RP Fer eee PCr rrr oeres 17

PE, +445 Rhee ee ee A-1-G-4

TABLE OF AUTHORITIES

CASES:

Air Pollution Variance Board v. Western Alfalfa

Corp., 416 U.S. 861 (1974) ....... - 9, 10, 13, 18

Chevron, U.S.A., Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. __, 81 L.Ed.2d 694

GE 6 sat bie weve cere cues aeetenes 16

Consumer Product Safety Commission v. G.T.E.

Sylvania, Inc., 447 U.S. 102 (1980) ......... 16

DuPont v. Christopher, 431 F.2d 1012 (5th Cir.

WE she edaeeavecastieueanasseayes 17

Federal Trade Commission v. Raladam Company, 283

ee RE rene eee ee 16

Hester v. United States, 265 U.S. 57 (1924)...... 12

Katz v. United States, 389 U.S. 347 (1967) .. 9, 13, 18

Kewanee Oil Company v. Bicron Corporation, 416

OE rere Sree eee 8, 17

Marshall v. Barlow's Inc., 436 U.S. 307 (1978) 9, 13, 18

Oliver v. United States, _. U.S. __, 80 L.Ed.2d 214

PSUR T TOPE ee ee te 9, 12, 18

Olmstead v. United States, 277 U.S. 438 (1928) .. 13

United States v. Kim, 415 F. Supp. 1252 (D.Ha.

| APCS Petes eee ETE eT 10, 13

United States v. Taborda, 635 F.2d 131 (2nd. Cir.

ee eee re ee ee 2 ee a 10, 13

STATUTES:

CEE og 0 cess oe oe 0460 8960404 3ee 5

Lo a) errs eer ee eo 4

i ot | er rs re ee 15

Lk Te re ae ee a ee 15

y Lig Sl) ree 2

| ae ee ae ee ee 4

LE eS) Se errrrr rrr er ce eee se 4

dl ree ae ee 4

i | es a ee 4

RT |) eee ee ee 4

42 U.S.C. § 7414(a) (§ 114 Clean Air Act) 2,7, 14-16

Stk le >). ee 3, 4, 16

Page

Sed ED 06 6c ee ee CEN Chea 17

ta , PCC CERT ETE 17

i | FPPPCEEETERIELE CELT ee 17

REGULATIONS:

ee ees ee ee ee 15

oe 2 Rk YY f eorrrre Sere ee ee 16

UNITED STATES CONSTITUTION:

Fourth Amendment ............ et a oe

13, 14, 17, 18

MISCELLANEOUS:

La Fave, SEARCH AND SEIZURE § 2.4 (1978) ... 12

Restatement of Torts § 757 (1939) ........... 17

No.

IN THE

Supreme Court of the United States

a

October Term, 1984

THE DOW CHEMICAL COMPANY,

Petitioner,

versus

UNITED STATES OF AMERICA

BY AND THROUGH ADMINISTRATOR,

ENVIRONMENTAL PROTECTION AGENCY,

Respondent.

—

PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

—— an

Petitioner respectfully prays that a Writ of Certiorari

issue to review the opinion of the United States Court

of Appeals for the Sixth Circuit decided and filed Nov-

ember 9, 1984.

OPINION BELOW

The opinion of the Court of Appeals decided and filed

on November 9, 1984 (Appendix A), has been reported

at 749 F.2d 307.

2

JURISDICTION

Jurisdiction of this Court to review the decision of the

United States Court of Appeals for the Sixth Circuit is

founded upon 28 U.S.C. § 1254(1).

The opinion of the Court of Appeals (Appendix A),

was decided and filed on November 9, 1984. A Petition

for Rehearing was not filed.

CONSTITUTIONAL AND STATUTORY PROVISIONS

U.S. Const. amend. IV provides:

The right of the people to be secure in their

persons, houses, papers, and effects, against un-

reasonable searches and seizures, shall not be

violated, and no Warrants shall issue, but upon

probable cause, supported by Oath or affirma-

tion, and particularly describing the place to be

searched, and the persons or things to be seized.

Subsection 114(a) of the Clean Air Act, 42 U.S.C.

§ 7414(a), provides:

Authority of Administrator

or authorized representative

For the purpose (i) of developing or assisting in

the development of any implementation plan

under section 7410 or section 7411(d) of this title,

any standard of performance under section 7411

of this title, or any emission standard under

section 7412 of this title, (ii) of determining

whether any person is in violation of any such

standard or any requirement of such a plan, or

(iii) carrying out any provision of this chapter

(except a provision of subchapter II of this chap-

3

ter with respect to a manufacturer of new motor

vehicles or new motor vehicle engines) —

(1) The Administrator may require any person

who owns or operates any emission source

or who is subject to any requirement of this

chapter (other than a manufacturer subject

to the provisions of section 7525(c) or 7542 of

this title) with respect to a provision of sub-

chapter II of this chapter to (A) establish and

maintain such records, (B)r.1ke such

reports, (C) install, use, an. maintain such

monitoring equipment or methods, (D) sam-

ple such emissions (in accordance with such

methods, at such locations, at such intervals,

and in such manner as the Administrator

shall prescribe), and (E) provide such other

information as he may reasonably require;

and

(2) the Administrator or his authorized repre-

sentative, upon presentation of his creden-

tials —

(A) shall have a right of entry to, upon, or

through any premises of such person

or in which any records required to be

maintained under paragraph (1) of this

section are located, and

(B) may at reasonable times have access to

and copy any records, inspect any moni-

toring equipment or method required

under paragraph (1), and sample any

emissions which such person is re-

quired to sample under paragraph (1).

Subsection 114(c) of the Clean Air Act, 42 U.S.C.

§ 7414(c), provides:

4

Availability of records, reports, and information

to public; disclosure of trade secrets

Any records, reports or information obtained

under subsection (a) of this section shall be avail-

able to the public, except that upon a showing

satisfactory to the Administrator by that person

that records, reports, or information, or particular

part thereof, (other than emission data) to which

the Administrator has access under this section if

made public, would divulge methods or pro-

cesses entitled to protection as trade secrets of

such person, the Administrator shall consider

such record, report, or information or particular

portion thereof confidential in accordance with

the purposes of section 1905 of Title 18, except

that such record, report, or information may be

disclosed to other officers, employees, or author-

ized representatives of the United States con-

cerned with carrying out this chapter or when

relevant in any proceeding under this chapter.

STATEMENT OF THE CASE

The genesis of this case was EPA’s surreptitious

acquisition ‘of aerial reconnaissance photographs of

Dow’s entire 2,000 acre fenced and secured Midland,

Michigan, manufacturing facility for use as evidence in

a Clean Air Act enforcement action concerning emis-

sions from Dow’s two power houses. For reasons of

worker safety, economics, maintenance and industry

custom, many of the process areas within the Dow Mid-

land facility are open-air plants. After learning of the

flyover from the EPA contractor, Dow brought this

action under 28 U.S.C. § 1331* to preserve its privacy

* Jurisdiction was also based on 28 U.S.C. §§ 1337, 1361, 2201,

2202 and 5 U.S.C. § 701.

5

interests and to protect the internal details, confidential

business information and trade secrets of its cpen-air

operations from public disclosure through the Freedom

of Information Act (5 U.S.C. 552) or any other

mechanism.

Dow has been manufacturing chemicals at its Midland

facility since the 1890’s. The 3.25 million dollar (1977

dollars) security system for the 2,000 acre manufacturing

facility is described in the District Court opinion [536 F.

Supp. 1355, 1364-1365] (Appendix B, pp. B-19-21). That

system ranges from an eight (8) foot high perimeter fence

and a twenty-four (24) hour security force of at least

twenty-five (25) people, to motion detectors at strategic

locations within the facility. Dow’s security measures to

protect against aerial photography, which include explicit

direction to the Dow security department to watch for sus-

picious aircraft (multiple passes) and follow-up was des-

cribed to the Court of Appeals (Jt. Appen., Ct. App., 291-

306). The Court, however, found that Dow takes no pre-

cautions against aerial observation (Appendix A, p. A-8).

Dow welcomed the EPA into Dow’s secured Midland

facility for a two (2) to three (3) hour inspection on

September 9, 1977. During the visit, which was part of

EPA’s ongoing investigation of emissions from Dow’s

two power houses, EPA was denied nothing it requested

to see. After the visit, Dow provided schematic drawings

of the power houses to EPA per its request.

On December 2, 1977, EPA contacted Dow and

requested a second, repetitive on-site inspection — but

this time with a camera. Dow refused the repetitive in-

spection and the taking of photographs. The possibility

of EPA’s getting a warrant was discussed.

Without further communication to Dow, on February

7, 1978, EPA caused the flyover of Dow’s entire Midland

facility and the taking of high resolution, vivid color

aerial photographs with a precision, floor-mounted, cer-

6

tified mapping camera. In six (6) passes over the plant

and approximately seventy-five (75) photographs, EPA

captured not only Dow’s two thousand (2,000) acre

fenced manufacturing area, but also Dow’s research and

corporate office areas, the Dow Corning Company facil-

ity, and nearly all of the city of Midland. Items and

equipment as small as one-half ('2) inch in diameter are

discernable from the original (unenlarged) contact prints

using simple, hand-held magnification. Many of these

minute, but observable items are located in interior

regions of the plant which are surrounded by buildings

and other structures which make observation from any-

where but directly above, a near physical impossibility.

EPA ordered the aerial reconnaissance photographs of

the Dow facility for use as direct evidence in a Clean Air

Act enforcement action against Dow relating to the

power house emissions. None of the photographs depic-

ted power house emissions.

Despite the District Court’s finding that items and

equipment, which were both inside the fence and

neither visible from the ground nor from the air with the

naked eye, were depicted in astonishing detail, the

Court of Appeals did not recognize the critical distinc-

tion between mere (unaided) aerial observation and

detailed aerial photography. The unaided human eye

and mind cannot perceive or capture for later study the

complex web of pipes, vessels and equipment of one

plant, much less many plants on 2,000 acres. The aerial

photographs at issue did.

Dow recognizes that planes fly over or near its plant.

But, there is no support in fact or in the record for the

Court of Appeals’ finding that the Midland plant is on a

take-off and landing pattern for an airport (Appendix A,

pp. A-8, 9).

7

The District Court granted Dow’s Motion for Partial

Summary Judgment and found that EPA’s actions of cap-

turing the entire facility in vivid detail (to the point of

discerning items '2 inch in size) after consent for an

inspection had been refused and without judicial au-

thorization was a violation of Dow’s reasonable expecta-

tion of privacy and an unreasonable search in violation

of the Fourth Amendment. The District Court also found

that aerial photography is outside of EPA’s inspection

authority since the practice of aerial photography cannot

comply with the plain language of Section 114(a)(2) of

the Clean Air Act, which authorizes EPA to present

credentials then enter to, upon or through a site to

inspect records, check monitoring equipment, or take

samples.

On November 9, 1984, the Court of Appeals reversed

in toto the District Court’s opinion. Despite the fact that

EPA admitted its activity was a search, the Court of

Appeals found that there was no search. The Court of

Appeals held that even though Dow had a privacy in-

terest to be free from ground level intrusion, Dow had

no reasonable expectation to be free from the aerial spec-

tator. The Court also held that “[a]lthough the [Clean

Air Act] does not expressly authorize enhanced aerial

observation, the language of Section 114 clearly does not

foreclose this technique.” (Appendix A, p. A-14).

No petition for rehearing was filed.

REASONS FOR GRANTING THE WRIT

This case should be granted certiorari because: a) this

Court's existing Opinions have not been followed; b) the

immediate cost to Dow and many others similarly situ-

ated to attempt to protect their privacy is extremely high

and there is little chance, at any cost, of obtaining

8

continuing protection as intrusive technology increases;

and c) nonparticularized and general searches by means

of aerial photography are frequently occurring and will

continue indefinitely without review, judicial oversight,

or legislative authority/safeguards since the searches are

carried out in a wholly surreptitious manner and hence

will not be challenged.

The Court of Appeals’ decision is inconsistent with

accepted precedents of this Court, common sense, and

public policy. The decision poses a tremendous eco-

nomic problem to the chemical industry. If complex

manufacturing facilities are deemed to be open fields in

which the owners have no reasonable expectation of

privacy with respect to visually enhanced intrusions,

then companies such as Dow cannot maintain that their

technology discernible through such visually enhanced

means has been maintained secret. Making reasonable

efforts to maintain the secrecy of a trade secret is a

condition precedent to alleging that information or tech-

nology in fact constitutes a protectable trade secret.

Kewanee Oil Company v. Bicron Corporation, 416 U.S. 470,

476 (1974). The decision cracks open the door to legaliz-

ing industrial espionage.

The Court of Appeals’ decision wiil soon engender

serious economic (privacy protection cost) and public

policy (privacy loss) problems and cause citizens to

engage in non-productive activity, such as attempting to

cover all or a portion of huge outdoor production pro-

cesses despite the common sense factors of worker

safety, plant maintenance and unit cost dictating against

such action. All to prevent government agents from

doing what they ought not do in the first place.

9

THE DECISION IS INCONSISTENT WITH THIS COURT’S

OPINIONS IN OLIVER v. UNITED STATES, 80 L.Ed.2d 214

(1984); MARSHALL v. BARLOW’S INC., 436 U.S. 307 (1978);

AIR POLLUTION VARIANCE BOARD v. WESTERN AL-

FALFA CORPORATION, 416 U.S. 861 (1974); AND KATZ v.

UNITED STATES, 389 U.S. 347 (1967)

__ It is axiomatic that commercial and industrial estab-

lishments have a reasonable expectation of privacy and

are entitled to Fourth Amendment protection in their

non-public areas. Marshall v. Barlow's Inc., 436 U.S. 307

(1978); Katz v. United States, 389 U.S. 347 (1967); and

Oliver v. United States, _. U.S. —_, 80 L.Ed.2d 214 (1984).

The Court of Appeals’ opinion is a radical departure

from those cases.

The Court of Appeals did find that Dow has an expec-

tation of privacy at ground level:

Here Dow had an actual expectation of privacy in

certain parts of its plant, privacy which included

the freedom from certain kinds of intrusion. Dow

took great pains to be free from ground level

intrusion by building a perimeter security fence

and employing security guards. 536 F. Supp. at

1364-65. Hence, Dow had a kind of actual privacy

expectation in these parts of its plant, a privacy

interest to be free from ground level intrusions

from the street. (Appendix A, p. A-8).

Despite its finding of a reasonable expectation of

privacy at ground level, the Court of Appeals aban-

doned consistency and common sense and found that

Dow had no reasonable expectation of privacy from the

air. The Fourth Amendment is thus eviscerated as far as

open-air industry is concerned. To reach this remarkable

conclusion, the Court ignored the distinction between

10

mere aerial observation and detailed aerial photography,

held that EPA’s admitted search was not a search at all,

held that Dow’s security measures to protect against

aerial photography were nonexistent, found that the

Dow facility was on an airport flight pattern despite no

support in fact or in the record, and held the secured,

developed industrial complex to be an open field.

A. Detailed Aerial Photography Versus

Mere Aerial Observation 4

The Court of Appeals ignored the critical distinction

between mere aerial observation and detailed aerial pho-

tography. Mere aerial observation (naked-eye) is akin to

a government agent watching a house from a public

park, or an EPA smoke reader observing a plume from

a public right-of-way. Air Pollution Variance Board v.

Western Alfalfa, 416 U.S. 861 (1974). Sophisticated aerial

photography, which perceives and captures detail which

is inaccessible to the unaided human eye or mind, is

analogous to using a telescope or telephoto lens to peer

into a structure to a degree where the details of human

activity are visible. Cf. United States v. Kim, 415 F. Supp.

1252 (D.Ha. 1976) [government use of telescope enabling

agents to determine reading material of suspect through

an apartment window is an unreasonable search], and

United States v. Taborda, 635 F.2d 131 (2nd Cir. 1980)

[enhanced viewing through a window into interior of a

home with a high-powered telescope unlawful].

As a public policy and common sense matter, the loca-

tion of the “window”, that is, to the street or to the sky,

should not matter. Once the human relations that create

the need for privacy are established, and the reasonable

expectation of privacy is recognized, the reasonableness

of the search is judged by the government's actions.

11

The EPA aerial reconnaissance photographs taken by

a floor-mounted certified mapping camera captured

Dow’s entire Midland facility (and most of Midland) in

such vivid detail as to defy the label of mere aerial

observation. Those pictures, which depict the inner

workings of the open-air manufacturing plants within

the fenced and secured Midland facility, are the product

of extremely intrusive, aided and constitutionally offen-

sive scrutiny. The photographs are the equivalent of

technical process drawings and blueprints — the very

heart of Dow’s business. EPA searched the interior

regions of the Dow facility — areas where the public has

no right to be. EPA “saw” the minute details of interior

portions of the plant not merely by means of the aerial

perspective, but through the aid of sophisticated visual

enhancement and capture via aerial photographs.

B. A Secured, Developed Industrial Facility

Is Not An Open Field

It is contrary to common sense and public policy that

an industrial facility can be deemed to be an open field

from the sky, but not from the ground. An area is either

an open field or it is not. It cannot logically be both.

Having Fourth Amendment rights at ground level is a

meaningless mockery if a more intrusive, non-particular-

ized, sucreptitious search method is available without

restriction upon government agents.

In its Opinion, the Court of Appeals references Dow’s

buildings and the spaces between those buildings

(Appendix A, pp. A-4, 6, 8-13). The Court overlooks the

complex mass of pipes, vessels and equipment which

comprise Dow’s outdoor manufacturing areas, the detail

of which Dow is trying to protect, and which are neither

buildings nor open spaces between buildings. Those

multi-million dollar outdoor plants are the basis of

12

Dow’s business, its competitive edge, and the fruits of

its inventors and engineers. They are protected by

Dow’s multi-million dollar security system and our legal

system.

Until the Court of Appeals’ decision, a secured and

developed industrial facility had never been held to be

an open field. The District Court specifically rejected the

applicability of the open fields exception to this case. 536

F. Supp. at 1358, n.5 (Appendix B, ¢. B-6). Since Hester

v. United States, 265 U.S. 57 (1924), the open fields

doctrine has been generally applied to rural, agricultural

land. Some courts have interpreted “field” well beyond

its literal meaning to include wooded areas, deserts,

_ vacant lots in cities, and open beaches, but never a

developed, secured industrial complex. See, I.W.

LaFave, Search and Seizure § 2.4 at 332 (1978). In those

cases the land is usually “developed” only in an agricul-

tural sense. The security and expectation of privacy

question usually revolves around agricultural-type fen-

cing and posting.

In Oliver v. United States, supra, this Court specifically

included “offices and commercial buildings” and “an

office or commercial structure” within the protection of

the Fourth Amendment, as opposed to “open fields.”

Id., p. 224, and p. 224 n.8. The Sixth Circuit opinion

misapprehends and misapplies the open fields doctrine

of Hester as reaffirmed in Oliver, in derogation of Peti-

tioner’s Fourth Amendment rights.

C. The Open Fields Doctrine Has Limited, If Any,

Application To Cases Where Sophisticated, Intru-

sive Surveillance Devices Are Employed To Seek

Evidence Without Consent Or Judicial Authority

The open fields doctrine must be limited both to the

nature of the site inspected and to the unaided or un-

13

enhanced viewing application of Hester and Oliver. As

Justice Brandeis cautioned in his dissent in Olmstead v.

United States, 277 U.S. 438 (1928), and as the Court

accepted in Katz, the Fourth Amendment must be

capable of wider application than the mischief which

gave it birth. Once it is decided that society recognizes

a reasonable expectation of privacy in a commercial

establishment, Marshall v. Barlow's Inc., supra, then that

protection ought not depend on the intrusive means

selected by the government.

Enforcement officials can observe (unaided) the

perimeter or exterior or plainly visible aspects of a

home, factory or apartment as much as they want. Air

Pollution Variance Board v. Western Alfalfa Corp., supra;

Marshall v. Barlow's Inc., supra. In fact, the EPA deployed

a smoke reader to the Dow facility after the September

1977 inspection and before the February 1978 flyover (Jt.

Appen., Ct. App., 91). However, when the government

uses observation or detection aids to intrude in minute

detail into the interior areas of a protected place, that

action has been held to be unconstitutional. United States

v. Taborda, supra, 635 F.2d at 137; United States v. Kim,

supra. The use of sophisticated photographic equipment

in this case is comparable to the wire-tap in Katz.

The expectation of privacy only has to be reasonabie,

not total. The law protects the reasonable expectation of

privacy, not the perfect security system. The perfect

security system has no need for protection. If achieve-

ment rather than expectation of privacy were the only

thing protected by the Fourth Amendment, then that

Amendment would be a nullity.

Dow has thirty-seven (37) manufacturing locations in

nineteen (19) states. Those locations encompass about

two hundred and ten (210) separate manufacturing units,

most of which are open air plants. The one representa-

14

tive plant discussed in this case covers thirty (30) acres,

and although deemed not practical by the plant manager/

engineer, would have cost at least $15,000,000 to roof in

1978. See Appendix F, excerpt of J. Wait’s 5/10/78 Depos-

ition, pp. 13-14 (F-1-F-2), for a brief summary of atten-

dant practical problems. The current cost of protecting

all, or a part of, two hundred and ten (210) plants would

be astronomical and unreasonable in view of Dow’s

existing multi-million dollar security system.

As the Court in Katz v. United States, supra, 389 U.S.

at 351, recognized: “What a person knowingly exposed to

the public, even in his own home or office, is not a

subject of Fourth Amendment protection. [Cite omitted. ]

But what he seeks to preserve as private, even in an area

accessible to the public, may be constitutionally pro-

tected” (emphasis added).

Il.

SECTION 114(a) OF THE CLEAN AIR ACT DOES NOT

AUTHORIZE, EITHER EXPLICITLY OR BY LACK OF PRO-

HIBITION, THE USE OF AERIAL PHOTOGRAPHY AS AN

INVESTIGATION TOOL

The Court of Appeals agrees that Section 114 of the

Clean Air Act does not expressly authorize enhanced

aerial observation (Appendix A, p. A-14). However, some

misplaced analogies are used to hold that the language

of Section 114 does not foreclose the technique. First

cited are data gathering methods which are distinguish-

able since they do not entail observing on-site details of

an industrial facility.

Next is a comparison with “other law enforcement

officers.” Even if the EPA is deemed to be a law enforce-

ment agency rather than an administrative agency, law

enforcement agencies are bound by the Constitution and

15

statutes which authorize and limit their activities. For

example, the Omnibus Crime Conirol And Safe Streets

Act defines the “why” and the “when” of warrants for

wiretaps. 18 U.S.C. § 2510 et seq. Other administrative

agencies, such as OSHA, have regulations that some-

what define and limit the agency’s statutory inspection

authority. 29 C.F.R. § 1903 et seq. EPA has no compar-

able regulations guiding the discretion of its inspectors.

The Court of Appeals’ analogy to military inves-

tigators is especially inappropriate. Not only does the

military operate under a different system of justice, but

it is expressly prohibited from aiding in civilian law

enforcement. 18 U.S.C. § 1385. Also, unlike the EPA,

the military generally keeps its files from public scrutiny.

In balancing citizens’ right to privacy and the EPA’s

investigation and enforcement needs, detailed aerial

photography is clearly a loser. There is absolutely no

particularity attendant to aerial photography. The camera

is switched on and the “run” is made, capturing every-

thing around the point of interest. Many people's pri-

vacy in addition to Dow’s was invaded in this case.

More economic, lawful and reliable alternatives exist.

Smoke-readers are used by the EPA. Under Section 114

(a)(1) the Agency has the authority to request a wealth

of information from a site owner or operator. Although

costly to the Agency to obtain, the aerial photographs in

this case showed no plume. The method is a hit-or-miss,

unreliable evidentiary tool.

A. The Decision Is Inconsistent With Congressional

Intent As Shown By The Plain Meaning Of The

Statutory Language

By statute, the EPA must present credentials, then enter

fo, upon or through the property for the purpose of

checking records, monitoring equipment or sampling emissions.

16

Section 114(a)(2) [42 U.S.C. § 7414(a)(2)]. None of the

statutory prerequisites or purposes delineated by Con-

gress are met by aerial phctography.

The Court of Appeals’ decision that the language of

Section 114 does not foreclose the use of aerial photo-

graphy as an on-site inspection technique is contrary to

the plain meaning of the statutory language. Consumer

Product Safety Comm. v. GTE Sylvania, Inc., 447 U.S. 102,

108 (1980).

Congress has directly spoken on the precise question

at issue; that is, the manner and purposes of a site

inspection under the Clean Air Act. Section 114(a)(2).

Congress’ unambiguously expressed intent must be

given effect. Chevron, U.S.A., Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. —, 81 L.Ed.2d 694, 703

(1984). “If broader powers be desirable, they must be

conferred by Congress. They cannot be merely assumed

by administrative officers; nor can they be created by the

courts in the proper exercise of their judicial functions.”

Federal Trade Commission v. Raladam Company, 283 U.S.

643, 649 (1931).

B. The Decision Is Inconsistent With The Clean Air

Act’s Provision Protecting Trade Secrets And

Existing Tort And Criminal Law

The Court of Appeals’ decision annihilates the protec-

tion for trade secrets offered by the Clean Air Act.

Section 114(c) (42 U.S.C. § 7414(c)) and 40 C.F.R. § 2.201

et seq. The Agency’s use of aerial photography abrogates

any trade secret protection since the person photo-

graphed has no notice of the Agency’s acquisition of the

photographs and no opportunity to claim that the pho-

tographs contain confidential business information.

The decision is also counter to the criminal law on

theft of trade secrets and the law of torts on misappro-

17

priation of trade secrets. The Restatement of Torts § 757

(1939) (Appendix C), is the basis of trade secret defini-

tion and protection. “The law also protects the holder of

a trade secret against disclosure or use when the know-

ledge is gained, not by the owner's volition, but by

some ‘improper means,’ Restatement of Torts § 757(a),

which may include theft, wiretapping, or even aerial

reconnaissance.” Kewanee Oil Company v. Bicron Corpora-

tion, supra, 416 U.S. at 475-476 (footnote omitted).

DuPont v. Christopher, 431 F.2d 1012 (5th Cir. 1970), cert.

den. 400 U.S. 1024 (1971), cites the Restatement of Torts

§ 757 and discusses the tortious taking of trade secrets

from a plant under construction by aerial photographs.

See also the Uniform Trade Secrets Act (Appendix D),

which was approved by the National Conference of

Commissioners on Uniform State Laws in 1979, and has

been adopted by at least seven (7) states. In part, a trade

secret under the Uniform Act (§ 1(4)) must not be

readily ascertainable by proper means, and subject to

efforts that are reasonable under the circumstances to

maintain its secrecy. Although Michigan has not yet

adopted the Uniform Trade Secrets Act, Michigan Com-

piled Laws (M.C.L.) § 752.772 (Appendix E), makes it a

crime to steal a trade secret. Photographs are explicitly

recognized in M.C.L. § 752.771 (Appendix E), as one

means of stealing trade secrets. It is also illegal to invade

one’s privacy by means of surveillance in Michigan.

M.C.L. § 750.539a and d (Appendix E).

CONCLUSION

The wide-spread ramifications of holding that a multi-

million dollar developed and secured industrial facility is

an open field, and hence outside of the protection of the

Fourth Amendment, is especially grim. Industrial privacy

18

and trade secret prutection from sophisticated surveil-

lance into open-air operations are lost. The potential for

abuse by the government is manifest. Searches will be

indiscriminate with no judicial authorization, no re-

straint on frequency, and no restraint on the nature or

scope of the surveillance.

The Court of Appeals, in reversing the District Court,

condoned the violation of Petitioner's right to be pro-

tected against unreasonable search and seizure as guar-

anteed by the Fourth Amendment, and granted the

Respondent carte blanche to conduct general searches

contrary to existing constitutional restraints and legisla-

tive direction.

In view of this Court’s decisions in Katz v. United

States, Marshall v. Barlow's Inc., Air Pollution Variance

Board v. Western Alfalfa, and Oliver v. United States, the

Open Fields Doctrine was misapplied and Petitioner's

reasonable, constitutionally justified, expectation of pri-

vacy was violated.

For reasons stated above, this Petition for Writ of

Certiorari should be granted.

Respectfully submitted,

By: JANE M. GOOTEE, Esq.

Counsel of Record

BERNDT W. SANDT, Esq.

The Dow Chemical Company

1111 Washington Street

Midland, Michigan 48674

(517) 636-2663

Counsel for Petitioner

Dated: February 7, 1985

TABLE OF CONTENTS OF APPENDIX

Page

APPENDIX A

Opinion of the U.S. Court of Appeals

eee Tee A-1l

APPENDIX B

Opinion of the U.S. District Court

for the Eastern District of Michigan ...... B-1

APPENDIX C

Excerpts from Restatement of Torts § 757 (1939)... C-1

APPENDIX D

Uniform Trade Secrets Act .............. D-1

APPENDIX E

Relevant Michigan Compiled Laws:

Mich. Comp. Laws § 750.539a andd..... E-1-E-2

Mich. Comp. Laws § 752.771 ........... E-2

Mich. Comp. Laws § 751.772 ........... E-3

APPENDIX F

Excerpt from Deposition of J. Wait,

EE sat 5. wah 06 bo 6-00 a ce fa F-]

APPENDIX G

Non-Fully Owned Subsidiaries And Affiliates Of

The Dow Chemical Company As Of

EES CIES 6 60-6 eG e's v8 v0 i o's G-1

)

A-1

APPENDIX TO PETITION FOR CERTIORARI

APPENDIX A

OPINION

(United States Court of Appeals

for the Sixth Circuit)

(Decided and Filed November 9, 1984)

(DOW CHEMICAL COMPANY, Piaintiff-Appellee, v.

UNITED STATES OF AMERICA, by and Through ANNE

M. BURFORD, ADMINISTRATOR, ENVIRONMENTAL PRO-

TECTION AGENCY, Defendant-Appellant — No. 82-1811;

ON APPEAL from the United States District Court for the

Eastern District of Michigan.)

Before: LIVELY, Chief Judge; MERRITT, Circuit Judge;

HORTON, District Judge. *

MERRITT, Circuit Judge.

In investigating Dow Chemical Company for possible

violations of the Clean Air Act, the Environmental Pro-

tection Agency caused aerial photographs of Dow’s 2000-

acre Midland, Michigan plant to be made by a private

aerial survey company. Upon learning of the EPA fly-

over, Dow sought declaratory and injunctive relief in the

United States District Court for the Eastern District of

Michigan. On cross-motions for partial summary judg-

ment, the District Court held that EPA’s detailed aerial

photography was an unreasonable search and seizure

under the Fourth Amendment. The District Court per-

manently enjoined EPA from conducting future aerial

* The Honorable Odell Horton, Judge of the United States District

Court for the Western District of Tennessee, sitting by designation.

A-2

surveillance and photography of Dow’s Midland, Michigan

plant. We hold that the photographic flyover did not

consititute a Fourth Amendment search and was not

outside the EPA’s statutory authority.

I.

The EPA began an investigation of Dow’s Midland,

Michigan plant during the latter part of 1977. The inves-

tigation focused on whether emissions from two coal-

burning power houses violated the federal air quality

standards established under the Clean Air Act.

On September 9, 1977, EPA made an on-site inspec-

tion of Dow’s power plants. EPA later requested and

received from Dow schematic drawings depicting both

the physical layout of the power houses and the boilers

and turbines within the power houses. EPA then called

Dow to arrange a second inspection. Dow refused to

grant entry for this inspection upon hearing that EPA

inspectors planned to take photographs of the plant.

After being denied entry, EPA informed Dow that it

would consider seeking a search warrant to gain access

to the plant.

EPA did not secure a warrant; instead, on February 6,

1978, EPA contracted with Abrams Aerial Survey Corpo-

ration, a private company located in Lansing, Michigan,

to take aerial photographs of the Dow plant. EPA’s

stated purposes for the aerial surveillance were to create

visual documentation of smokestack emissions and to

obtain perspectives on the layout of the plant and its

relationship to the surrounding geographic area. EPA

directed Abrams to take the pictures at particular

altitudes and angles; EPA informed Abrams that emis-

sions would be more visible in early morning or late

afternoon, but left the actual time of the flight to

Abrams’ discretion.

A-3

Abrams performed the overflight in the afternoon on

February 7, 1978. The aircraft made at least six passes

over the plant at altitudes of 12,000, 3,000, and 1,200

feet. Abrams used a Wild RC-10 aerial mapping camera

to take approximately 75 color photographs of various

parts of the Dow plant. Because of Abrams’ sophisti-

cated photographic equipment, the photographs contain

vivid detail and resolution; some of the photographs can

be enlarged to a scale of 1 inch equals 20 feet or greater,

without significant loss of detail or resolution. The

District Court found that when enlarged in this manner

and viewed under magnification, the photographs show

equipment, pipes and power lines as small as 4 inch in

diameter.

EPA did not notify Dow either before or after the

flight. When Dow learned of the event a few weeks

later, from sources other than EPA, Dow filed this

action.

The District Court reasoned that once it is established

that an administrative search occured, “[t]he question

[turned] on whether EPA’s authority under the Clean

Air Act meets ‘the sufficiently comprehensive and de-

fined’ criteria of Donovan v. Dewey . . . or whether the

search violated a reasonable expectation of privacy.” 536

F. Supp. at 1360. The District Court concluded that

Marshall v. Barlow's Inc., 436 U.S. 307, 313 (1978),

controlled the present case, and that an administrative

search requires a warrant, unless the search falls into

one of several narrow and well-defined exceptions to the

warrant requirement. In the District Court’s view, EPA’s

search of Dow’s chemical plant did not fit any of these

exceptions. Hence, the Court found that EPA’s aerial

photography of Dow’s Midland plant was an unreason-

able search proscribed by the Fourth Amendment.

A-4

Although the Court “[was] fairly certain that the Fourth

Amendment issue raised in this case is properly re-

solved on the basis of an administrative inspection

analysis alone,” 536 F. Supp. at 1363, nevertheless, it

considered it useful to “alternately review the facts

(in Dow) under the framework of Katz.” Id. According

to the District Court, the search of Dow’s Midland

plant was unreasonable because EPA’s aerial photography

invaded Dow’s reasonable expectation of privacy in the

“interior regions of its plant” — meaning by this phrase,

the open, outdoor spaces between plant buildings. The

Court concluded that the photographic equipment used

by EPA’s agents constituted “enhanced viewing” that

invaded Dow’s reasonable expectation of privacy in

these outdoor regions. Additionally, the search was

unreasonable because EPA’s needs in preventing pollu-

tion, though legitimate, were outweighed by Dow’s

reasonable expectation of privacy.

Lastly, the District Court held that the Clean Air Act

did not authorize EPA to institute aerial surveillance

of chemical plants. Hence, by conducting such surveil-

lance, EPA exceeded its statutory authority under the Act.

Therefore, two questions are presented by this appeal.

First, we must decide the constitutional issue of whether

there was an unreasonable search under the Fourth

Amendment. Second, did EPA exceed its statutory

authority under the Clean Air act by conducting the

aerial photography?

Il.

The Fourth Amendment provides for “people to be

secure in their persons, houses, papers and effects

against unreasonable searches . . . and [that] no warrant

shall issue but upon probable cause . . ..” U.S. Const.

A-5

amend. IV. The U.S. Supreme Court held nearly twenty

years ago that these protections apply, at least in part,

when a governmental agency conducts an administrative

search of a commercial facility. Camara v. Municipal

Court, 387 U.S. 523 (1967); See v. City of Seattle, 387 U.S.

541 (1967). More recently, in Marshall v. Barlow's Inc.,

436 U.S. 307 (1978), the Court clarified the law con-

cerning administrative searches and held that when

government action constitutes a Fourth Amendment

“search,” the agency must get an administrative

warrant, or, subject to certain exceptions, the search will

be deemed unreasonable.’ If the government action in

this case — EPA’s aerial photography of Dow Chemi-

cal’s Midland, Michigan plant — constitutes a Fourth

Amendment “search,” then Barlow’s controls, and EPA’s

warrantless search violated Dow’s Fourth Amendment

rights. If, on the other hand, the aerial photography was

not a search, then EPA’s aerial observation did not

violate the Fourth Amendment. The question before this

court then is whether EPA’s aerial photography was

sufficiently intrusive to constitute a “search” triggering

the warrant clause of the Fourth Amendment.

' Exceptions to the Barlow's administrative warrant requirement

have been made in industries like the alcoholic beverage industry,

which has long been “subject to close supervision and inspection.”

Colonnade Corp. v. United States, 397 U.S. 72, 77 (1970), and the fire-

arms industry, which has also been subject to pervasive and

comprehensive government regulation. United States v. Biswell,406

U.S. 311 (1972). Implicit in these exceptions to the warrant require-

ment is the notion of implied consent. Another exception has been

carved out when a statute, by explicitly requiring a warrantless

search, “establishe[d] a predictable and guided federal regulatory

presence.” Donovan v Dewey, 452 U.S. 594, 604 (1981) (Supreme

Court upholds constitutionality of section 103(a) of the Mine Safety

and Health Act requiring that mine safety inspectors make warrani-

less searches). Inherent in this exception is a test that balances the

strength of the federal regulatory interest, on the one hand, with the

reasonable expectation of privacy of the commercial entity on the

other. The government has not argued for the application of any of

these exceptions to this case.

A-6

The issue of whether there was a search is a threshold

requirement of Fourth Amendment analysis. To be enti-

tled to Fourth Amendment protection, it is first neces-

sary to determine whether there was a “search,” a term

of art with special constitutional significance. Tradition-

ally, in defining what constituted a search, the Supreme

Court interpreted the Fourth Amendment as primarily

protective of property rights; a trespass was a necessary

condition for determining whether a search had occur-

red. See Olmstead v. United States, 277 U.S. 438 (1928)

The Supreme Court modified this property based con-

cept in Katz v. United States, 389 U.S. 347 (1967). Katz

defines what constitutes a search with a two-prong test:

first, the person claiming Fourth Amendment protection

must prove that he or she had an actual, or a subjective,

expectation of privacy in the area intruded upon by the

government. Second, that subjective expectation must be _

one that society would deem reasonable. The Katz

doctrine therefore protects an individual's actual privacy

interest when that interest is reasonable. In the instant

case, we must determine whether the government's

aerial photography of Dow’s Midland plant intruded

upon Dow’s actual and reasonable expectation of privacy

in the spaces between its buildings, or in the words of

the District Court, “in the interior regions of its plant.”

Before applying the Katz analysis to this case, it is

important to note that the word “reasonable” is used in

Fourth Amendment analysis in two different ways, and

that these two ways must be separated in order to avoid

confusion. A “reasonable search” is different from a

“reasonable expectation of privacy.” The former refers to

whether “probable cause” existed or whether the officers

exceeded the limits of the warrant. The latter determines

whether there was a Fourth Amendment “search” at all

and focuses on whether the human relationships that

A-7

normally exist at the place inspected are based on inti-

macy, confidentiality, trust or solitude and hence give

rise to a “reasonable” expectation of privacy. The District

Court may have confused or conflated these two when

it stated that it “[was] fairly certain that the Fourth

Amendment issue raised in this case is properly re-

solved on the basis of an administrative inspection

analysis alor -” without reference to an analysis under

Katz. 536 F. Supp. at 1363. But in order for an admini-

strative inspection to trigger the Fourth Amendment,

there must be a search in the constitutional sense of that

term. Hence, Katz must be discussed for Katz defines in

terms of privacy interests what a search is for Fourth

Amendment purposes.

III.

Establishing an actual expectation of privacy requires

two elements. First, it must be established what a

person had an expectation of privacy in, for example, a

home, office, phone booth or airplane. Second, it must

be established what the person wanted to protect his

privacy from, for example, non-family members, non-

_ employees of a firm, strangers passing by on the street

or flying overhead in airplanes. The New York Stock

Exchange, a place which illustrates the two types of

expectations, permits only members and employees on

the floor but welcomes the public observer from above.

A useful test of whether a person has a privacy

interest in a certain place is whether there are any

“objective manifestations of any claimed privacy expecta-

tions.” Dow Chemical Co. v. United States, 536 F. Supp.

1355, 1364 (E.D. Mich. 1982). See also United States v.

Taborda, 635 F.2d 131, 137 (2nd Cir. 1980) (looking into a

dwelling window with telescopic lenses invades Fourth

Amendment privacy inw rest). The objective manifestations

A-8

of a privacy expectation must be in some place and an

expectation to be free from a certain kind of intrusion.

Here Dow had an actual expectation of privacy in

certain parts of its plant, privacy which included the

freedom from certain kinds of intrusion. Dow took great

pains to be free from ground level intrusion by building

a perimeter security fence and employing security

guards. 536 F. Supp. at 1364-65. Hence, Dow had a kind

of actual privacy expectation in these parts of its plant,

a privacy interest to be free from ground level intrusions

from the street. But Dow did not take any precautions

against aerial intrusions, even though the plant was near

an airport and within the pattern of planes landing and

taking off. If elaborate and expensive measures for

ground security show that Dow has an actual expecta-

tion of privacy in ground security, as Dow argues, then

taking no measure for aerial security should say some-

thing about its actual privacy expectation in being free

from aerial observation. Certainly, no one could reason-

ably expect Dow to build a dome over its entire Midland

plant in order to establish its expectation of privacy, free

from aerial intruders. But it does not follow that Dow

could not take any measures at all to shield outdoor

spaces from aerial observers. Dow could have shielded

the critical spaces in between its buildings, if it had an

actual expectation of privacy from aerial observation of

these regions. A comparison of the precautions a person

does take with the precautions he might take, when

such precautions are feasible and not unreasonably

expensive, is a factor to be considered in determining

his privacy expectation from the kind of intruder about

whom he is complaining. Dow has described no trade

secret or confidential relationship outside its building

walls that the observer from above would compromise,

and Dow’s objective behavior does not indicate an

expectation to be free from the aerial spectator.

A-9

IV.

We are not convinced that Dow had an actual expecta-

tion of privacy from the air, but even if Dow did have

such an expectation the expectation was unreasonable.

On this question, the District Court erred in dismissing

defendant's “open field” argument. Dow’s Midland plant

is 2000 acres, located in an urban area near an airport

and within the pattern of planes landing and taking off.

Both the size and location of an entity must be taken

into account in order to determine whether it is objec-

tively reasonable to expect privacy in all or part of that

entity. Dow’s size and location militate against regarding

an expectation of privacy free from aerial observation as

reasonable. When the entity observed is a multi-building

complex, and the area observed is the outside of these

buildings and the spaces in between the buildings, and

when the complex is near an airport and within the

pattern of planes landing and taking off, it is difficult to

see how a reasonable person would have privacy expec-

tations in the outside of the buildings and the spaces

between the buildings.

Although the analogy is not perfect, Dow’s Midland

plant is much more like “open fields” than it is a home

or office. When the area observed is like an open field,

an inspection which would otherwise be a search be-

comes a non-search for Fourth Amendment purposes.

Hester v. United States, 265 U.S. 57 (1924); Air Pollution

Variance Board v. Western Alfalfa Corp., 416 U.S. 861

(1974). The Supreme Court recently reaffirmed the “open

fields” doctrine and interpreted it in light of Katz. Oliver

v. United States, 104 S.Ct. 1735 (1984). The Court held

that individuals cannot demand privacy rights for

activities conducted in what are essentially open fields.

The context or conditions for privacy are not present

there, and such demands are not reasonable. Id. In

A-10

affirming this Court in Oliver, the Supreme Court made

reference to and quoted with apparent approval from a

passage in our opinion, the full text of which reads as

follows:

The Fourth Amendment and other laws protecting

privacy create the conditions and the context for

many relationships based on intimacy, friendship

and trust. These laws establish an environment

in which individual emotional and mental pro-

cesses can develop freely without surveillance or

interference. The legal principles that protect

privacy, therefore, do not protect the desert

island, the mountain top or the open field —

even one that the owner posted with a “no tres-

pass” sign. The human relations that create the

need for privacy ‘do not ordinarily take place in

these settings. The only significant interest at

stake here — a property owner's interest in ex-

cluding others from his possessions — is not

sufficient alone to bring into play legal principles

protecting privacy.

United States v. Oliver, 686 F.2d 356, 360 (6th Cir. 1982)

(en banc). Our reasoning there leads to the conclusion

here that the interior spaces outside Dow’s buildings are

not places in which one may have a reasonable privacy

expectation.

It is true that certain outside areas associated with a

home or dwelling have traditionally received Fourth

Amendment protection as falling within the “curtilage.”

Thus, the Fourth Amendment has been held to apply to

the search of a smokehouse located within a fenced

yard, see Robertson v. United States, 165 F.2d 752 (6th Cir.

1948), and to a honeysuckle patch situated within a

fence 150 feet from a home. See United States v. Van

Dyke, 643 F.2d 992 (4th Cir. 1981).

A-11

It can be argued here that the areas in between Dow’s

buildings formed a sort of industrial curtilage, and there-

fore should receive Fourth Amendment protection.

However, to apply the curtilage doctrine to this 2000-

acre manufacturing complex would be a distortion of the

principles on which the doctrine rests. The doctrine of

curtilage is grounded in the peculiarly strong concepts of

intimacy, personal autonomy and privacy associated

with the home. The home is fundamentally a sanctuary,

where personal concepts of self and family are forged,

where relationships are nurtured and where people nor-

mally feel free to express themselves in intimate ways.

The potent individual privacy interests that inhere in

living within a home expand into the areas that enclose

the home as well. The backyard and area immediately

surrounding the home are really extensions of the

dwelling itself. This is not true simply in a mechanical

sense because the areas are geographically proximate. It

is true because people have both actual and reasonable

expectations that many of the private experiences of

home life often occur outside the house. Personal inter-

actions, daily routines and intimate relationships revolve

around the entire home place. There are compelling

reasons, then, for applying Fourth Amendment protec-

tion to the entire dwelling area.

Dow has legitimate privacy interests in many aspects

of its corporate life. Dow has strong expectations of

privacy within its offices and inside its enclosed facil-

ities. These interests are not so powerful that they auto-

matically apply to the exterior of Dow’s plant. In the

home setting, Fourth Amendment protection applies to

adjoining areas because of the unique privacy interests

associated with dwelling places, and because of our

traditional understanding that home life is not confined

A-12

the physical structure of the house. The areas —

between industrial buildings do not normally share the

same uses.

Although Dow has a reasonabie expectation of privacy

in the interior of its plant buildings and offices, this is

not to say that such a privacy interest has equal force to

that which inheres in a dwelling. Indeed, the Court's

ruling in Marshall v. Barlow's Inc., supra, that a lesser

showing of probable cause is required to secure an

administrative warrant, is evidence of this difference.

The Court has noted that a commercial owner's privacy

interest “differs significantly from the sancitity accorded

an individual’s home.” Donovan v. Dewey, 452 U.S. 594,

598-99 (1981). Dow’s reasonable privacy interest in the

interior of its buildings does not extend into the areas

between the buildings because, unlike the home setting,

there is no compelling reason in terms of privacy to

justify this extension. After a diligent search we have

found no cases applying the curtilage concept to the

commercial setting. Although there may be some places

for research and development or employee interaction

which justify an extension of the concept, we hold that

the common law curtilage doctrine does not apply to

this particular manufacturing setting.

V.

Finally, much is made of the government’s use of

sophisticated photographic equipment from the air. The

District Court found that such sophisticated technology

violated Dow’s Fourth Amendment rights because the

extreme detail of the photographs enabled a viewer to

observe “more than the human eye could ever see.” 536

F. Supp. at 1367.

A-13

The government conducts a search when it uses “en-

hanced viewing of the interior of a home,” because it

impairs “a legitimate expectation of privacy and encoun-

ters the Fourth Amendment’s warrant requirement.”

United States v. Taborda, 635 F.2d 131, 139 (2nd Cir.

1980). Had the EPA’s aerial photography of Dow’s plant

intruded inside the plant offices, file rooms and eating

areas, it would be proscribed by Taborda.* As we have

already discussed, it is unpersuasive, however, to com-

pare the spaces in between Dow’s buildings as anything

like the interior of a home or its curtilage. The « *1tdoor

spaces of a chemical plant are simply a necessary reature

of a plant, a complex of buildings, having several dispa-

rate buildings. Dow has not described what privacy inter-

ests contained in these spaces make enhanced viewing

violative of the Fourth Amendment.

Vi.

The District Court also erred in upholding Dow’s

contention that EPA’s use of enhanced aerial observation

as an inspection technique exceeded the agency’s au-

thority under the Clean Air Act. The District Court held

that section 114 of the Clean Air Act, 42 U.S.C. § 7414,

does not authorize aerial photography as an inves-

tigatory tool “even by reasonable implication.” 536 F.

Supp. at 1374. This finding was based on the court's

statutory interpretation of section 114(a)(2)(A), which

2 Our reasoning in this regard is similar to that of the Ninth

Circuit in United States v. Allen, 633 F.2d 1282 (9th Cir. 1980). In

Allen, aerial agg tie were taken of the exterior of ranch build-

ings and grounds. When enlarged, these photographs showed

details of drug smuggling operations. The Ninth Circuit held that the

warrantless helicopter surveillance of the coastal ranch was not a

search under the Fourth Amendment. The Court observed that the

case did not present PP cages expectations associated with the inter-

iors of residences or structures.” 633 F.2d at 1289.

A-14

provides that “upon presentation of credentials,” the

EPA has a “right of entry to, upon, or through any

premises.” 42 U.S.C. § 7414(a)(2)(A). In holding that

enhanced aerial surveillance was not impliedly author-

ized by section 114, the court found that the language

of the statute pointed to the conclusion that Congress

meant only to authorize “land-based examination of

emission sources.” 536 F.Supp. at 1374.

Although the statute does not expressly authorize

enhanced aerial observation, the language of section 114

clearly does not foreclose this technique. Congress has

delegated general investigative authority to EPA under

the Clear Air Act. EPA investigators may go to the

library to research a company, talk to its employees and

former employees and observe the plant from different

vantage points without making an “entry” on the pre-

mises which requires notification. Other law enforce-

ment officers who use aerial observation in their work,

e.g., drug enforcement and traffic officers, coast guard

and property tax mapping officials, do not have to

announce their presence in advance or present creden-

tials. Like these officers, EPA investigators should be

permitted to use aerial photography as a part of their

general investigative authority. Congress need not ex-

pressly delegate this authority to EPA just as it need not

expressly delegate it to the FBI or the DEA or to military

investigators. So long as these investigators operate in

the public air space and do not intrude into areas

protected by the Fourth Amendment, they may use an

airplane and a camera without presentation of creden-

tials to the owners of property over which they fly.

Accordingly, the judgment of the District Court is

reversed. Costs are asseessed against appellee.

B-1

APPENDIX B

MEMORANDUM OPINION AND ORDER

(United States District Court —

Eastern District of Michigan,

Northern Division)

(Dated April 19, 1982)

(The DOW CHEMICAL COMPANY, Plaintiff, v. UNITED

STATES OF AMERICA, By and Through Anne M. GOR-

SUCH, Administrator, Environmental Protection Agency,

Defendants — Civ. No. 78-10044)

JAMES HARVEY, District Judge.

I.

INTRODUCTION

This case involves a constitutional and statutory

challenge to the use of warrantless aerial photo-

graphy of a chemical manufacturing plant by the

Environmental Protection Agency (EPA). The Dow

Chemical Company (Dow) asserts that this activity

by the EPA constitutes an unreasonable search in

violation of the Fourth Amendment, a taking and

misappropriation of trade secrets in violation of the

Fifth Amendment, and the use of an inspection

tool which is outside the scope of EPA’s statutory

authority under Sections 113 and 114 of the Clean

Air Act, 42 U.S.C. §§ 7413-7414 (1980). Dow seeks

a declaratory judgment and injunctive relief.

B-2

Il.

FACTS

The Dow Chemical Company owns and operates a

2000 acre manufacturing plant in Midland, Michigan. In

the latter part of 1977 EPA, the governmental agency

primarily charged with administering and enforcing the

federal pollution laws, was conducting an investigation

of Dow to check emissions from the power houses

located inside Dow’s facility for possible violations of

federal air quality standards.

In September of 1977, EPA made an on-site inspection

of the power houses at Dow’s plant. After the inspection

EPA requested, and later received, schematic drawings

of the power houses from Dow.

In December of 1977 EPA again contacted Dow and

requested a subsequent entry for purposes of inspecting

the power houses. Prior to making this request EPA had

already begun preparations for a planned enforcement

action against Dow.’ EPA informed Dow that as part of

the inspection it would be taking photographs of the

Dow layout and facility. Dow objected to EPA’s inten-

tion to take photographs and therefore denied EPA’s

request for entry. In response, EPA suggested to Dow

that it would consider seeking a search warrant to gain

entrance to the plant.

Rather than institute a civil action or seek a search

warrant, EPA decided to obtain aerial photographs of

Dow’s facility. On February 6, 1978, EPA contracted

with Abrams Aerial Survey Corporation (Abrams), a

private company located in Lansing, Michigan, to take

. A clean air act enforcement action was eventually filed and is

presently awry binpagh aby cmarery Stewart A. Newblatt of this

District. United v. Dow Chemical Company, No. 80-10011 (ED

Mich., filed January 25, 1980).

RECT AV

)

B-3

aerial photographs of the Dow plant. EPA specifically

informed Abrams as to the altitude, location, and direc-

tion from which the photographs were to be taken.

In the afternoon of February 7, 1978 Abrams flew over

Dow’s plant as directed. The aircraft made at least 6

passes over the plant at altitudes of 12,000, 3,000, and

1,200 feet. Abrams used a sophisticated Wild RC-10

aerial mapping camera to take approximately 75 color

photographs of various parts of the Dow plant.”

The Court has carefully examined all of the photo-

graphs and has been struck by their vivid detail and

resolution. As amply demonstrated by Dow ata hearing

before the Court, some of the photographs taken from

directly above the plant at 1,200 feet are capable of

enlargement to a scale of 1 inch equals 20 feet or greater,

without significant loss of detail or resolution. When

enlarged in this manner, and viewed under magnifica-

tion, it is possible to discern equipment, pipes, and

power lines as small as 2 inch in diameter. Many of

these minute, but observable items are located in interior

regions of the plant which are surrounded by buildings

and other structures which make observation from any-

where but directly above, a near physical impossibility.°

2 It is important to an understanding of this case to provide a

description of the highly effective equipment used by Abrams. The

i used was a twin engine Beechcraft, which Abrams describes

as able to “provide omg ta stability, fast mobility and flight

endurance required precision photography.” Handbook on Aerial

Surveys & Photogrammetry — Abrams ial Survey Corporation. The

camera used by Abrams cost in excess of $22,000.00 and is described

by the company as the “finest precision aerial camera available.” Id.

The camera was mounted to the floor inside the aircraft and was

capable of taking several photographs in precise and rapid succes-

sion. Id.

3 Throughout its brief, EPA has used the term exterior to describe

the areas depicted in the photographs. Dow has implied that these

(continued on following page)

ILABLE COPY ©

B-4

Dow was not aware of the EPA flyover either before

or during its occurrence. When it subsequently became

aware of this event a few weeks later, from sources

other than EPA, Dow immediately instituted this action.

Il.

JURISDICTION AND ISSUES PRESENTED

The Court has jurisdiction over the subject matter

herein pursuant to 28 U.S.C. § 1331, 5 U.S.C. § 702, and

28 U.S.C. §§ 2201-2202.

This action presents 3 central issues for the Court's

consideration:

I. Whether the EPA flyover and aerial photo-

graphy of Dow’s facilities constitutes an un-

reasonable search in violation of the Fourth

Amendment;

II. Whether aerial photography of Dow’s plant

by EPA constitutes a taking of property (trade

secrets) without due process in violation of

the Fifth Amendment; and

Ili. Whether EPA exceeded its statutory authority

under Sections 113 and 114 of the Clean Air

Act in using warrantless aerial photography

as an investigatory tool.

This matter is presently before the Court on cross mo-

tions for summary judgment. Dow seeks summary judg-

ment on the Fourth Amendment and statutory issues,

and EPA seeks entry of summary judgment on all issues.

(continued from preceding page)

B-5

This case is appropriate for summary judgment on the

Fourth Amendment and Clean Air Act questions, since

the material facts relative to these claims are not in

dispute, and a decision thereon can be rendered as a

matter of law. F.R.Civ.P. 56(c). See Felix v. Young, 536

F.2d 1126, 1130 (CA 6, 1976). As to the Fifth Amend-

ment claim, however, and for reasons more fully

described later in this opinion, infra, genuine issues of

material fact exist which render disposition of that

question by summary judgment inappropriate. See

Willetts v. Ford Motor Co., 583 F.2d 852, 855 (CA 6, 1978).

For the reasons stated below, the Court concludes that

the EPA flyover and aerial photography violated Dow’s

rights under both the Fourth Amendment and the Clean

Air Act. Partial summary judgment on these issues will

therefore be entered in favor of Dow and against EPA.

IV.

DISCUSSION

FOURTH AMENDMENT

[1] The first clause of the Fourth Amendment to the

United States Constitution provides that, “the right of

the people to be secure in their persons, houses, papers,

and effects, against unreasonable searches and seizures,

shall not be violated .. .” As the very language of this

amendment makes clear, the Constitution does not pro-

scribe all governmental searches and seizures, only

those that are unreasonable.

Dow puts forth at least 3 analytical arguments in

support of its position that the overhead flight and aerial

photography by EPA constituted an unreasonable

search: first, under Coolidge v. New Hampshire, 403 U.S.

443, 91 S.Ct. 2022, 29 L.Ed.2d 564 (1971), that a warrant-

less search is per se unreasonable; second, under Marshall

B-6

v. Barlow's Inc., 436 U.S. 307, 98 S.Ct. 1816, 56 L.Ed.2d

305 (1978) that this was an unreasonable warrantless

inspection; and third, under Katz v. United States, 389

U.S. 347, 88 S.Ct. 507, 19 L.Ed.2d 576 (1967), that EPA

violated Dow’s reasonable expectation of privacy. The

Court will separately address each of these contentions.

Before turning to Dow’s first assertion, the Court

wishes to point out that the EPA has admitted, both in

its briefs and at oral argument, that the flyover consti-

tuted both a “quest for evidence”* and a “search” of

Dow’s plant. (EPA Brief at 9; Transcript of oral argument

at 44).° EPA has also admitted that the search was

conducted without first securing a warrant. Id. With

these two premises established, the Court need only

determine whether the search was unreasonable within

the meaning of the Fourth Amendment.

A. Per Se Unreasonable

[2] Subject only to “a few specifically established and

well-delineated exceptions,” warrantless searches have

been recognized as per se unreasonable and therefore

violative of the Fourth Amendment. Katz v. United

States, 389 U.S. 347, 357, 88 S.Ct. 507, 514, 19 L.Ed.2d

576 (1967); Schneckloth v. Bustamonte, 412 U.S. 218, 219,

93 S.Ct. 2041, 2043, 36 L.Ed.2d 854 (1973); Coolidge v.

New Hampshire, 403 U.S. 443, 454-455, 91 S.Ct. 2022,

2031-2032, 29 L.Ed.2d 564 (1971). On the basis of this

* EPA was admittedly attempting to gather evidence for a

planned enforcement proceeding against Dow. An action was later

filed and is still pending. See note 1 supra.

5 Paradoxically, EPA later asserts that the “open fields” exception

of Hester v. United States, 265 U.S. 57, 44 S.Ct. 445, 68 L.Ed. 898

(1924) applies to this case, making EPA’s actions a “non-search” and

taking it outside the protection of the Fourth Amendment. (EPA

Brief at 13-15). The Court, however, rejects the applicability of the

“open fields” exception to this case and therefore independently

concludes that a search occurred. See Discussion, Section IV(D) infra.

B-7

principle, Dow asserts that EPA’s aerial search of its

facility, without prior judicial scrutiny or oversight, is per

se unreasonable.°® Relying upon Donovan v. Dewey, 452

U.S. 594, 101 S.Ct. 2534, 69 L.Ed.2d 262 (1981), EPA

responds that warrantless searches of commercial estab-

lishments are not per se prohibited by the Fourth

Amendment, but are only impermissible if they violate

a legitimate expectation of privacy.

In the area of administrative inspections, wherein this

case “roughly” fits, the Supreme Court appears to have

retreated somewhat from the hard and fast conclusion

that warrantless searches are per se unreasonable.” In

Marshall v. Barlow's Inc., 436 U.S. at 313, 98 S.Ct. at

1820, the Court, in tracing some of its earlier decisions,

used the phrase “generally unreasonable” to describe

warrantless administrative searches. Later in the same

opinion the Court stated that “the reasonableness of a

warrantless search ... will depend upon the specific

enforcement needs and privacy guarantees of each

statute.” Id. at 322, 98 S.Ct. at 1825. In its most recent

® Dow’s position in this regard is not without sound policy

considerations to support it. As the Supreme Court stated in Katz,

389 U.S. at 359, 88 S.Ct. at 515:

Wherever a man may be, he is entitled to know that he will

remain free from unreasonable searches and seizures. The

government agents here ignored ‘the procedure of antece-

dent justification ... that is central to the Fourth Amend-

ment,’ a procedure that we hold to be a constitutional

precondition of the kind of electronic surveillance involved

in this case.

See also Marshall v. Barlow's Inc., 436 U.S. at 323, 98 S.Ct. at 1825.

This “constitutional pre-condition” is the genesis of this Court's ulti-

mate conclusion in this case that at a minimum, EPA should have

secured an ex parte warrant before carrying cut the aerial search. See

note 20 and accompanying text, infra.

” The Sixth Circuit, however, continues to adhere to the principle

that warrantless administrative searches are per se unreasonable.

United States v. Blue Diamond Coal Co., 667 F.2d 510 (CA 6, 1981).

B-8

decision in this area, the Court in Donovan v. Dewey, 452

U.S. at 599, 101 S.Ct. at 2538, 69 L.Ed.2d at 269-270, an-

nounced that:

... the Fourth Amendment protects the interest

of the owner of property in being free from

unreasonable intrusions onto his property by

agents of the government. Inspections of

commercial property may be unreasonable if they

are not authorized by law or are unnecessary for

the furtherance of federal interests.

* * *

, a warrant may not be constitutionally

required when Congress has reasonably deter-

mined that warrantless searches are necessary to

further a regulatory scheme and the federal

regulatory presence is sufficiently comprehensive

and defined that the owner of commercial prop-

erty cannot help but be aware that his property

will be subject to periodic inspections undertaken

for specific purposes. °

On the basis of this authority, the Court agrees with

the EPA that, under the facts of this case, the Fourth

Amendment inquiry does not end — with a decision

adverse to the government — once it is established that

a warrantless administrative search occurred. The

question must turn on whether EPA’s authority under

the Clean Air Act meets the “sufficiently comprehensive

8 This Court's citation of the language above is not to suggest

that the Court finds a parallel between the authority of the EPA

under the Clean Air Act, 42 U.S.C. § 7401 et seq., and the Depart-

ment of Labor under the Federal Mine Safety and Health Act, 30

U.S.C. § 801 et seq.; it does not. The language is quoted only as

support for the Court’s determination that a warrantless administra-

tive inspection is not per se unreasonable, and that a more sensitive

reading of the Fourth Amendment is required in this case.

B-9

and defined” criteria of Donovan v. Dewey, supra, or

whether the search violated a reasonable expectation of

privacy. See United States v. Taborda, 635 F.2d 131, 136

(CA 2, 1980); United States v. DeBacker, 493 F.Supp. 1078,

1081 (WD Mich., 1980).

B. Administrative Inspection

The question of the reasonabieness of a commercial

entity’s expectation of privacy is necessarily intertwined

with, and must be considered in the context of, the

Supreme Court's decisions in the area of administrative

inspections.” Most recent in this relatively short line of

authority is Marshall v. Barlow's Inc., supra, and Donovan

v. Dewey, supra.

Dow asserts that Barlow’s, wherein the Court held that

a warrantless administrative inspection under the Occu-

pational Safety and Health Act, 29 U.S.C. § 657(a) (1970)

(OSHA) violated the Fourth Amendment, controls this

case. EPA, on the other hand, maintains that Dewey,

which upheld a warrantless administrative search under

the Federal Mine Safety and Health Act, § 103(a), 30

U.S.C. § 813(a) (1977) (FMSHA), controls the present

facts. For the reasons expressed below, the Court holds

that this case is governed by the principles and rationale

of Barlow’s.

The Fourth Amendment prohibition against unreason-

able searches was extended to administrative inspections

of private commercial property nearly a decade and a

half ago. Camara v. Municipal Court, 387 U.S. 523, 87

S.Ct. 1727, 18 L.Ed.2d 930 (1967); See v. City of Seattle,

387 U.S. 541, 87 S.Ct. 1737, 18 L.Ed.2d 943 (1967). The

° As the Court stated in Marshall v. Barlow's Inc., 436 U.S. at 313,

98 S.Ct. at 1820, citing Katz v. United States, supra, “certain industries

have such a history of government oversight that no reasonable

expectation of privacy could exist. . .”

B-10

reason for this extension was found in the basic purpose

of the amendment, which is “to safeguard the privacy

and security of individuals against arbitrary invasions of

government officials.” Camara, 387 U.S. at 528, 87 S.Ct.

at 1730. Unlike searches of private homes, however,

which generally must be conducted pursuant to a war-

rant in order to be reasonable, “legislative schemes

authorizing warrantless administrative searches of

commercial property do not necessarily violate the

Fourth Amendment.” Dewey, 452 U.S. at 598, 101 S.Ct.

at 2538, 69 L.Ed.2d at 268.

The touchstone of any decision on the legality of a

warrantless administrative search is a consideration of

the type of business involved, and an analysis of the

“pervasiveness and regularity” of the applicable legisla-

tive scheme. Dewey, supra, 452 U.S. at 604, 101 S.Ct. at

2541, 69 L.Ed.2d at 273. Barlow's and its progeny, Camara

and See, created the general rule that absent consent, a

warrant is constitutionaily required before an administra-

tive inspection may be conducted. From this general

rule, certain narrowly defined exceptions have been

carved out. In Colonnade Catering Corp. v. United States,

397 U.S. 72, 73, 90 S.Ct. 774, 775, 25 L.Ed.2d 60 (1970),

the Supreme Court recognized that because the alcoholic

beverage industry had long been “subject to close super-

vision and inspection,” Congress enjoyed “broad power

to design such powers of inspection ... as it deems

neccessary to meet the evils at hand.” Id. at 76-77, 90

S.Ct. at 776-777. Similarly, in United States v. Biswell, 406

U.S. 311, 92 S.Ct. 1593, 32 L.Ed.2d 87 (1972), the Court

concluded that the federal statute regulating firearms

provided a sufficiently comprehensive and predictable

inspection scheme that the warrantless inspections man-

dated under the statute did not violate the Fourth Am-

endment. Id. at 316, 92 S.Ct. at 1596. Most recently, in

Donovan v. Dewey, supra, the Court held that “warrant-

B-11

less inspections required by the Mine Safety and Health

Act do not offend the Fourth Amendinent. Id. 452 U.S.

at 602, 101 S.Ct. at 2539, 69 L.Ed.2d at 271. The Court

explained that:

... the Mine Safety and Health Act applies to

industrial activity with a notorious history of

serious accidents and unhealthful working condi-

tions. The Act is specifically tailored to address

those concerns, and the regulation of mines it

imposes is sufficiently pervasive and defined that

the owner of such a facility cannot help but be

aware that he ‘will be subject to effective inspec-

tion’ . . . First, the Act requires inspection of all

mines and specifically defines the frequency of

inspection.

... Second, the standards with which a mine

operator is required to comply are ali specifically

set forth in the Act or in Title 30 of the Code of

Federal Regulations.

... Thus, rather than leaving the frequency and

purpose of inspections to the unchecked discre-

tion of government officers, the Act establishes a

predictable and guided federal regulatory pre-

sence. Like the gun dealer in Biswell, the oper-

ator of a mine ‘is not left to wonder about the

purposes of the inspector or the limits of his

task.’ ;

Id. 452 U.S. at 603, 101 S.Ct. at 2540, 69 L.Ed.2d at 272

(citations omitted). '°

‘© Even prior to the Supreme Court's decision in Dewey, the Sixth

Circuit had upheld a similar warrantless inspection of a sand and

gravel quarry. Marshall v. Nolichuckey Sand Co. Inc., 606 F.2d 693 (CA

6, 1979), cert. denied, 446 U.S. 908, 100 S.Ct. 1835, 64 L.Ed.2d 261

(1980).

B-12

EPA relies heavily on the language of Dewey"', but

makes no argument that EPA’s authority to regulate the

chemical industry under the Clean Air Act constitutes a

sufficiently “predictable and guided federal regulatory

presence” as to include it as an exception to the general

rule prohibiting warrantless administrative inspections.

This is understandable, since it is clear to this Court that

no such plausible argument can be made.

Unlike the government's control over the alcohol, fire-

arms, and mining industries, the chemical industry is

not “pervasively regulated” by EPA under the Clean Air

Act. EPA’s authority to regulate entities such as Dow is

more closely akin to the authority of the Department of

Labor under OSHA which the Supreme Court reviewed

in Barlow's. The Court described that authority as

follows:

(OSHA) imposes health and safety standards on

all businesses engaged in or affecting interstate

commerce that have employees . . . and author-

izes representatives of the Secretary to conduct

inspections to ensure compliance with the act. . .

However, the Act fails to tailor the scope and

frequency of such administrative inspections to

the particular health and safety concerns posed

by the numerous and varied businesses regulated

by the statute.

Donovan v. Dewey, 452 U.S. at 601, 101 S.Ct. at 2539, 69

L.Ed.2d at 270 (citations omitted).

1! EPA’s reliance on Dewey appears to be for the proposition that

the lesser degree of Fourth Amendment protection accorded

commercial premises in general, and the federal regulation of the

chemical industry in particular, undercuts and thereby diminishes

Dow’s reasonable expectation of privacy. This assertion is addressed

by the Court later in this opinion. See Discussion, Section IV(C) infra.

B-13

As one commentator, himself a former Assistant Re-

gional Counsel for the EPA accurately observed:

EPA, like OSHA, regulates all kinds of indus-

tries. Once again, the test is not whether the

industry is regulated, but whether it is pervasively

regulated. Although certain environmental stat-

utes, the Federal Water Pollution Control Act

(FWPCA), for example, are licensing statutes in

the very broadest sense, such licensing and regu-

lation is distinguishable from that which was

present in Colonnade or Biswell. The scope of the

FWPCA is much more akin to the kind of regula-

tion that exists under the auspices of OSHA.

Both OSHA and EPA regulate a broad spectrum

of different industries pursuant to legislative

mandates. However, those myriad businesses are

not necessarily highly regulated industries which

may be said by implication to consent to warrant-

less inspections. In that sense, Barlow's, Inc.'s

finding of the non-applicability of this exception

in an OSHA context also applies to EPA.

Martin, EPA and Administrative Inspections, 7 Fla.St.L.Rev.,

123, 131-132 (1979).

The only statutory provision authorizing administra-

tive inspections in the Clean Air Act is Section 114, 42

U.S.C. § 7414.'* This provision potentially applies to any

number of different industries. By its terms it neither

requires or defines the type or frequency of inspections,

ner contains standards by which they are to be con-

ducied. In fact, on its face, this provision does not

2 Section 114 of the Clean Air Act provides in pertinent part that:

(a) For the purpose ... (ii) of determining whether any

person is in violation of any such standard or any require-

(continued on following page)

B-14

appear to allow forced entry without some form of prior

judicial oversight.'* The Supreme Court has already

recognized this limitation in the Clean Air Act in its

Barlow's decision wherein it observed:

Some statutes already envision resort to federal-

court enforcement when entry is refused, em-

ploying specific language in some cases...

(an) example is the Clean Air Act, which

grants federal district courts jurisdiction “to

require compliance” with the Administrator

of the Environmental Protection Agency’s

attempt to inspect under 42 U.S.C. § 7414,

when the Administrator has commenced “a

civil action” for injunctive relief or to re-

cover a penalty.

436 U.S. at 321 n.18, 98 S.Ct. at 1825 n.18 and accom-

panying text.

In addition, the legislative history of the Clean Water

Act, 33 U.S.C. §§ 1251-1376, also supports the observa-

tion that forced entry, or warrantless inspection, is not

(continued from preceding page)

ment of such a plan, or (iii) carrying out any provision of

(2) the Administrator or his authorized representative,

upon presentation of his credentials —

(A) shall have a right of entry to, upon, or through

any premises of such person or in which any

records i to be maintained under para-

graph (1) of this section are located, and

(B) may at reasonable times have access to and copy

any records, i any monitoring equipment or

method under paragraph (1), and sample

any emissions which such person is required to

sample under paragraph (1).

13 See note 27 and accompanying text, infra.

B-15

contemplated under the Clean Air Act. The Senate

Report to the Act states that “As under the Clean Air Act,

the Committee expects that authority to enter will be

used judiciously and upon any challenge to entry the

Committee expects the Administrator to obtain the nec-

essary warrant.” S.Rep.No. 92-44, 92d Cong., Ist Sess.

62, reprinted in [1972] U.S.Code Cong. & Ad.News 3668,

3729 (emphasis added).

The inescapable conclusion of the foregoing judicial

and legislative pronouncements is that the holding and

rationale of Barlow’s controls in this case. Therefore,

EPA’s warrantless aerial search of Dow’s plant cannot

withstand Fourth Amendment scrutiny. The repugnance

of this form of warrantless inspection activity was well

stated by the Supreme Court in Barlow's, 436 U.S. at 323-

324, 98 S.Ct. at 1825-1826:

The authority to make warrantless searches

devolves almost unbridled discretion upon execu-

tive and administrative officers, particularly those

in the field, as to when to search and whom to

search. A warrant, by contrast, would provide

assurances from a “eutral officer that the inspec-

tion is reasonable under the Constitution, is

authorized by statute, and is pursuant to an ad-

ministrative plan containing a specific neutral

criteria. Also, a warrant would then and there

advise the owner of the scope and objects of the

search, beyond which limits the inspector is not

expected to proceed. These are important func-

tions for a warrant to perform, functions which

underlie the Court’s prior decisions that the

Warrant Clause applies to inspections for

compliance with regulatory statutes. “

* It is indeed curious that in the present case EPA argues that

its warrantless search of Dow was not inconsistent with the Barlow's

(continued on following page)

B-16

For these reasons, the Court concludes that EPA’s aerial

photography of Dow’s facilities, in an admitted quest for

evidence, constituted an unreasonable search in viola-

tion of the Fourth Amendment.

In the typical administrative inspection case the

Court’s Fourth Amendment inquiry would halt at this

point. This case, however, is not “typical” in any sense

of the word. We are not here dealing with an ordinary

on-site administrative search, neither are we faced with

one of the more common Fourth Amendment challenges.

Indeed, the Court’s research suggests that, con-

sidering the facts before it, it is venturing into unchar-

tered constitutional territory.

(continued from preceding page)

decision, when a published EPA memorandum suggests that as a

matter of agency policy, its position is otherwise:

Barlow's clearly establishes that the owner does have the

right to ask for a warrant under normal circumstances.

Therefore, refusal to allow entry for inspectional purposes

will not lead to civil or criminal penalties if the refusal is

based on the inspector's lack of a warrant and one of the

exemptions discussed in Part C does not apply. If the owner

were to allow the inspector to enter his establishment only

in response to a threat of enforcement liability, it is quite

possible that any evidence obtained in such an inspection

would be inadmissible. An inspector may, however, inform

the owner who refuses entry that he intends to seek a

warrant to compel the inspection. In any event, when entry

is refused, the inspector should leave the premises

immediately and telephone the designated Regional Enforce-

ment Attorney as soon as possible for further instructions.

The Regional Enforcement Attorney should contact the U.S.

Attorney's Office for the District in which the establishment

desired to be inspected is located and explain to the appro-

priate Assistant United States Attorney the need for a

warrant to conduct the particular inspection.

EPA Memorandum on Inspection Procedures, 41 Envir.Rep. (BNA) 2451,

2452 (April 11, 1979). It is undisputed that in this case, Dow specific-

ally refused EPA’s request for entry prior to the flyover.

B-17

Both Dow and EPA devoted much of their attention,

in briefing and arguing this case, to an analysis of the

present facts under the Supreme Court's decision in Katz

v. United States, 389 U.S. 347, 88 S.Ct. 507, 19 L.Ed.2d

576 (1967) and subsequent interpretive decisions. The

Fourth Amendment analysis, as applied to this case,

focuses on the question of whether Dow had a reason-

able expectation of privacy which was violated by EPA’s

flyover and photography of Dow’s plant.

The Court is fairly certain that the Fourth Amendment

issue raised in this case is properly resolved on the basis

of an administrative inspection analysis alone. Given,

however, the atypical nature of this case, the fact that

the parties have explored the Katz analysis at length,

and the additional fact that this analysis raises several

important sub-issues and policy considerations, the

Court will alternatively review the facts before it under

the framework of Katz.

C. Expectations Of Privacy

[3] In Katz v. United States, 389 U.S. at 351-352, 88

S.Ct. at 511-512, the Supreme Court observed that:

the Fourth Amendment protects people, not

places. What a person knowingly exposes to the

public even in his own home or office, is not a

subject of Fourth Amendment protection . . . But

what he seeks to preserve as private, even in an

area accessible to the public, may be constitution-

ally protected.

Justice Harlan, in a concurring opinion which has

since become the prevailing formulation for evaluating

the legality of a search, see Rakas v. Illinois, 439 U.S. 128,

99 S.Ct. 421, 58 L.Ed.2d 387 (1978); United States v.

Bailey, 628 F.2d 938 (CA 6, 1980); erected a twofold

requirement to determine whether one possesses an

B-18

expectation of privacy which is protectable under the

Fourth Amendment. This test was best described by

Justice Blackmun in Smith v. Maryland, 442 U.S. 735, 736,

740, 99 S.Ct. 2577, 2578, 2580, 61 L.Ed.2d 220 (1979):

... the application of the Fourth Amendment

depends on whether the person invoking its pro-

tection can claim a ‘justifiable,’ a ‘reasonable,’ or

a ‘legitimate expectation of privacy’ that has been

invaded by government action . . . This inquiry,

as Mr. Justice Harlan aptly noted in his Katz

concurrence, normally embraces two discrete

questions. The first is whether the individual, by his

conduct, has ‘exhibited an actual (subjective) expecta-

tion of privacy,’ 389 U.S. at 361 [88 S.Ct. 507 at

516, 19 L.Ed.2d 576] — whether, in the words of

the Katz majority, the individual has shown that

‘he seeks to preserve [something] as private.’ Id.

at 351 [88 S.Ct. 507 at 511, 9 L.Ed.2d 576]. The

second question is whether the individual's subjective

expectation of privacy is ‘one that society is prepared

to recognize as “reasonable.”’ id., at 361 [88 S.Ct.

507 at 516, 19 L.Ed.2d 576] — whether, in the

words of the Katz majority, the individual's

expectation, viewed objectively, is ‘justifiable’

under the circumstances. (citations omitted; em-

phasis added).

This Court must now apply this two-part test to the

facts before it.

1. DOW'S PRIVACY EXPECTATION

[4, 5] The extent of any claimed privacy expectation

must be evaluated in light of the identity of the party

seeking to invoke the protections of the Fourth Amend-

ment. Donovan v. Dewey, supra; GM Leasing Corp. v.

United States, 429 U.S. 338, 97 S.Ct. 619, 50 L.Ed.2d 530

B-19

(1977). While the expectation of privacy that the owner

of commercial property enjoys “differs significantly from

the sanctity accorded an individual’s home,” Id., it is

clear that a commercial establishment may possess a

protectable privacy expectation under the Fourth

Amendment. Marshall v. Barlow's Inc., supra.

[6] The first part of the Katz test appears to require

that a party’s actual state of mind be determined.

Various courts, however, have interpreted this aspect of

the test as an “objective” rather than a “subjective”

requirement. United States v. Taborda, 635 F.2d 131, 137

(CA 2, 1980); United States v. Kim, 415 F.Supp. 1252,

1256-1257 (D.Haw., 1976); accord United States v. Bailey,

628 F.2d 938, 942-943 (CA 6, 1980). This Court agrees

with this interpretation, and concludes that the essence

of the first prong of the test is that the party “must have

acted in such a way that it would have been reasonable

for him to expect that he would not be observed.”

United States v. Taborda, supra. Therefore, the Court must

look to objective manifestations of any claimed privacy

expectation.

[7] The first and most obvious indicia of a privacy

expectation is ownership. Wilson v. Health and Hospital

Corporation of Marion City, 620 F.2d 1201, 1212-1213 (CA

7, 1980). Dow’s ownership of the Midland complex is

undisputed. Ownership of property alone, however, is

insufficient to claim an expectation of privacy. The

owner must demonstrate that the premises were kept in

a closed and secured condition. Id.

Dow cites the following measures as evidence that it

has manifested and exhibited an expectation of privacy

in its plant:

1. A chain-link fence at least 8 feet high installed

completely around the production facility;

10.

B-20

gates for ingress and egress at various inter-

vals in the fence have an attendant (guard) on

duty when any given gate is in operation to

admit or allow people to leave the facility;

closed-circuit television surveillance for con-

tinuously monitoring the various entrance and

exit gates and to monitor the area along the

fence surrounding the facility;

alarm systems which will indicate unauthor-

ized entry at various locations;

motion detectors at strategic locations to indi-

cate movement of personnel in certain re-

stricted areas within the facility;

roving patrols which travel throughout the

facility and guard the perimeter to augment

the other security systems;

liaison with local public law enforcement offi-

cials including radio communication to assist

in the apprehension of persons engaged in

unlawful activities relating to the production

facility;

a requirement that employees entering the

facility must exhibit an identification bade [sic]

in every instance of entry;

a requirement that non-employees who wish

to visit the facility must be approved and must

obtain a visitors pass including a bade [sic]

which must be exhibited at all times while in

the facility;

a requirement that non-employees who have

been approved to visit be greatly restricted in

their movements and that some areas of the

facility remain off-limits to all non-employees;

11.

12.

13.

14.

15.

B-21

a requirement that cameras by anyone other than

an authorized representative of Dow are prohibited

at all times and in all places in the facility;

a requirement that persons visiting for techni-

cal reasons must obtain a technical pass which

provides among other things that the visitor

will not disclose any technical information

learned as an incidence to his visit;

a staffing program such that security person-

nel are on duty twenty-four hours a day and

seven days a week with at least twenty-five

such people on duty at all times and with

about fifty people on duty during normal duty

hours;

a security budget whereby Dow spent at least

3.25 million dollars in each of the last ten

years on the security of the Midland produc-

tion facility; and

a disposal or drawings etc, that requires that,

in the event the engineering drawings and/or

blueprints of a specific production plant were

to be disposed of, for example, at the conclu-

sion of construction, the drawings and/or

blueprints would be packaged and incinerated

under the direction of security personnel who

would also witness the incineration.

In addition, Dow points out that its employees and

contractors sign secrecy agreements, and that its plant

layout is designed in such a way that the more sensitive,

proprietary areas are not visible to persons on the public

right-of-way outside the fence. (Dow Brief at 11-12).

EPA responds to these assertions by arguing that Dow

has sought only to restrict access to its plant and to

protect its trade secrets from the eyes of its competitors,

B-22

it has not attempted to conceal the exterior of its plant

from view. Therefore, EPA maintains that Dow has

failed to satisfy the first prong of Katz. This Court

cannot agree.

As previously explained’, EPA’s reference to the

exterior of. Dow’s plant mischaracterizes what was actu-

ally captured in the aerial photographs. The photo-

graphs depict internal regions of the plant in such vivid

detail, capable of further enlargement and magnification,

as to defy simply being described as views of the exterior

of the facility. When these photographic results are

combined with the uncontroverted fact that Dow de-

signed its plant so as to conceal the more sensitive,

proprietary areas in the inner regions of the complex,

EPA’s position loses its persuasive weight.

The Court in Katz, 389 U.S. at 351-352, 88 S.Ct. at 511-

512, specifically stated that what a person “seeks to

preserve as private, even in an area accessible to the public,

may be constitutionally protected.” (emphasis added).

Dow would never be able to show that it possesses a

legitimate privacy expectation in its entire plant. Obvi-

ously, much of the plant is observable by the general

public, both from the ground and from the air. But what

is visible to the public are areas which Dow, either

purposely or due to some commercial or architectural

impracticability, has decided to allow the general public

to see. Notwithstanding this common sense limitation,

Dow may still possess an expectation of privacy with

respect to interior regions of its facility.

The Fourth Amendment should not be read as to re-

quire the citizens or businesses of this nation to take

unreasonable measures to protect themselves from sur-

reptitious governmental searches. This Court is not pre-

15 See note 3 and accompanying text, supra.

B-23

pared to conclude that Dow must build a dome over its

entire plant before it can be said to have manifested or

exhibited an expectation of privacy. See United States v.

Allen, 633 F.2d 1282, 1289 (CA 9, 1980), cert. denied,

U.S. —, 102 S.Ct. 133, 70 L.Ed.2d 112 (1981). Rather,

what Dow “seeks to preserve as private,” and then takes

reasonable precautions to safeguard, is entitled to the

protection of the Fourth Amendment. Katz v. United

States, supra. On this basis, the Court finds that Dow has

satisfied the first prong of the Katz test.

2. REASONABLENESS OF DOW’S

PRIVACY EXPECTATION

The more difficult question to decide in this case is the

second prong of Katz: whether Dow’s expectation of

privacy is one that society is prepared to accept as

reasonable. EPA proposes several factors which should

be considered in resolving this inquiry.'° On the basis

of these factors, EPA’s position is that even if Dow has

exhibited an expectation of privacy, it is not one that

society accepts as reasonable.

Some of the factors proposed by EPA pertain either to

the issue of whether Dow manifested a privacy expecta-

tion’” or whether the “open fields” exception to the

Fourth Amendment, Hester v. United States, 265 U.S. 57,

44 S.Ct. 445, 68 L.Ed. 898 (1924), is applicable to this

‘© The factors proposed by EPA include:

1. Lawfulness of Location From Which Observation

was made

Equipment Used to Make the Observation

Type of Location Observed

Nature of Objects or Activities Observed

Efforts to Conceal Objects or Activities from View

Frequency of Overflights

al ‘heptytuuhad tana bdeenettnt

ee

B-24

case.'® Some of its suggested factors, however, do go to

the question of reasonableness and therefore merit some

discussion.

In describing the “type” and “nature” of the location

observed as 2 factors to be considered, EPA argues that

“it is hard to imagine anything larger or more con-

spicuous than a 2000 acre chemical manufacturing plant

located in an urban area of a city.” (EPA Brief at 20). As

stated previously, the Court would agree that Dow

could not possess a reasonable expectation of privacy in

its entire plant. It may, however, exhibit such an expec-

tation with respect to internal areas of the plant.

While not a Fourth Amendment case, the holding of

the Fifth Circuit in E.I. duPont de Nemours & Co. Inc. v.

Christopher, 431 F.2d 1012 (CA 5, 1970), cert. denied, 400

U.S. 1024, 91 S.Ct. 581, 27 L.Ed.2d 637 (1971), which the

Supreme Court cited approvingly in Kewanee Oil Co. v.

Bicron Corp., 416 U.S. 470, 476 n. 5, 94 S.Ct. 1879, 1883

n. 5, 40 L.Ed.2d 315 (1974), is instructive. duPont filed an

action against a competitor, under Texas law, for using

aerial surveillance and photography to obtain its trade

secrets. In ruling in duPont’s favor that aerial photo-

graphy was an improper method of discovering trade

secrets, the Court reasoned that:

... Wwe realize that industrial espionage of the

sort here perpetrated has become a popular sport

in some segments of our industrial community.

However, our devotion to free wheeling indus-

trial competition must not force us into accepting

the law of the jungle as the standard of morality

expected in our commercial relations. Our toler-

ance of the espionage game must cease when the

18 This is true of at least factors 1 and 2, perhaps all of them. See

Discussion, Section IV(D) infra.

B-25

protections required to prevent another's spying

cost so much that the spirit of inventiveness is

dampened. Commercial privacy must be protected

from espionage which could not have been reasonably

anticipated or prevented. We do not mean to imply,

however, that everything not in plain view is

within the protected vale, nor that all information

obtained through every extra optical extension is

forbidden. Indeed, for our industrial competition

to remain healthy there must be breathing room

for observing a competing industrialist. A

competitor can and must shop his competition

for pricing and examine his products for quality,

components, and methods of manufacture. Perhaps

ordinary fences and roofs must be built to shut out

incursive eyes, but we need not require the discoverer

of a trade secret to guard against the unanticipated,

the undetectable, or the unpreventable methods of

espionage now available.

* + *

To require duPont to put a roof over the un-

finished plant to guard its secret would impose

an enormous expense to prevent nothing more

than a school boy’s trick. We introduce here no

new or radical ethic since our ethos had never

given moral sanction to piracy. The market place

must not deviate far from our mores. We should

not require a person or corporation to take unreason-

able precautions to prevent another from doing that

which he ought not to do in the first place. Reason-

able precautions against predatory eyes we may

require, but an impenetrable fortress is an

unreasonable requirement, and we are not dis-

posed to burden industrial inventors with such a

duty in order to protect the fruits of their efforts.

Id. at 1016-1017 (emphasis added).

B-26

This statement of policy reasons in support of a state

tort law decision nonetheless provides guidance to the

Court here. As in duPont, the present case also involves

claims of trade secret appropriation. The rationale of

duPont supports this Court’s belief that commercial

privacy may be expected and exhibited, and may be

deemed reasonable and legitimate by society. Just as

duPont need not be required to take “unreasonable

precautions” to prevent aerial photography of its plant

as a prerequisite to a tort action, likewise Dow should

not be so required in order to claim the protection of the

Fourth Amendment.

Society has spoken in this area through Congress, the

State Legislatures, and the courts. Federal law, under

the Trade Secrets Act, 18 U.S.C. § 1905, makes it a crime

for government employees to disclose trade secret infor-

mation. The Clean Air Act itself, in Section 114(c), 42

U.S.C. § 7414(c), addresses this concern for propriety

information. Moreover, EPA has adopted regulations

providing for protection of trade secrets. 40 CFR 2.201-

2.309. Michigan law, in addition to recognizing a tort

action, also makes it a crime to appropriate trade secrets,

M.C.L.A. § 752.772, as well as to invade one’s privacy

by means of surveillance. M.C.L.A. §§ 750.539a-539b.

These legislative and judicial pronouncements are reflec-

tive of a social acceptance of Dow’s privacy expectation

as reasonable.

There is some dispute in this case as to whether use

of sophisticated aerial photography equipment consti-

tutes visually enhanced surveillance.'"? Dow suggests

that “a sophisticated aerial camera, in the hands of a

government agent, is even more constitutionally repug-

nant than a telescope because it enables the searcher to

permanently capture the image for later detailed study

19

supra note 2.

B-27

at leisure.” (Dow Brief at 42). EPA, on the other hand,

posits that this equipment captures nothing more than

that which is already visible to the naked eye. (EPA

Brief at 17-18; Transcript of oral argument at 29-32).

Having examined the photographs, the Court is

unable to agree with EPA’s position that “the camera

can’t see what the eye can’t see” Id. On the contrary,

when flying at 1,200 or 5,000 feet, the eye can discern

only the basic sizes, shapes, outlines, and colors of the

objects below. In this case, the finest precision aerial

camera available was used to take the EPA photographs.

The camera successfully captured vivid images of Dow’s

plant which EPA could later analyze under enlarged and

magnifie’ conditions. In doing so, the camera saw a

great dv. more than the human eye could ever see. The

court therefore would agree with Dow that the use of a

sophisticated aerial camera is, at a minimum, on a par

with other methods of visually enhanced surveillance in

terms of its intrusiveness.

In United States v. Taborda, 635 F.2d 131 (CA 2, 1980),

the Second Circuit was faced with the issue of whether

observation by means of a high-powered telescope con-

stituted the type of intrusion against which the Fourth

Amendment protects. Consistent with Katz, the Court

concluded:

. . . Observation of objects and activities inside a

person’s home by unenhanced vision from a loca-

tion where the observer may properly be does

not impair a legitimate expectation of privacy.

However, any enhanced viewing of the interior of a

home does impair a legitimate expectation of privacy

and encounters the Fourt Amendment's warrant

requirement, unless circumstances create a tradi-

tional exception to that requirement. Id. at 139

(emphasis added).

B-28

See also United States v. Kim, 415 F.Supp. 1252, 1254-1256

(D.Hawaii, 1976). Since the present case involved an

intrusion into the interior of Dow’s palnt, as the Court

has previously defined that term, the enhanced viewing

in this case similarly encounters the Fourth Amend-

ment’s warrant requirement.

[8] Turning the question of “reasonableness” around

for a moment — i.e. looking at the reasonableness of the

government's actions — it is likely that society would

view many forms of visually enhanced surveillance by

the government as unreasonable. This is particularly so

when it is used in a non-criminal context. See United

States v. Bailey, 628 F.2d 938, 944 (CA 6, 1981). In this

age of ever-advancing and potentially unlimited tech-

nology the government should be made aware that it

does not possess carte blanche authority to utilize

sophisticated surveillance methods to keep watch over

citizens or businesses not suspected of any criminal

activity. As the government's arsenal of technologically-

advanced surveillance equipment expands, so too the

protections of the Fourth Amendment should broaden in

response. United States v. Holmes 521 F.2d 859, 866 (CA

5, 1975), United States v. Kim, 415 F.Supp. at 1257.

The Court is reminded of the powerfully eloquent

dissent of Justice Douglas in United States v. White, 401

U.S. 745, 756, 760-761, 91 S.Ct. 1122, 1128, 1130-1131, 28

L.Ed.2d 453 (1971):

Electronic surveillance is the greatest leveler of

human privacy ever known. How most forms of

it can be held ‘reasonable’ within the meaning of

the Fourth Amendment is a mystery. To be sure,

the Constitution and Bill or Rights are not to be

read as covering only the technology know in the

18th century. Otherwise its concept of ‘commerce’

would be hopeless when it comes to the manage

B-29

ment of modern affairs. At the same time the

concepts of privacy which the Founders enshrined

in the Fourth Amendment vanish completely

when we slavishly allow an all-powerful govern-

ment, proclaiming law and order, efficiency, and

other benign purposes, to penetrate all the walls

and doors which men need to shield them from

the pressures of a turbulent life around them and

give them the health and strength to carry on.

* + *

. . . Electronic aids add a wholly new dimension

to eavesdropping. They make it more penetrating

more indiscriminate, more truly obnoxious to a

free society. Electronic surveillance, in fact,

makes the police omniscient; and police omnisci-

ence is one of the most effective tools of tyranny.

These same concerns are not entirely absent from this

case. While the EPA did not engage in any form of “Star

Wars” surveillance, and only used equipment which was

commercially available, if this warrantless investigatory

method is countenanced in this case, where will courts

draw the line? In this regard the Court finds merit in the

language of Dean v. Superior Ct., 35 Cal. App.3d 112, 110

Cal.Rptr. 585, 588-589 (1973):

Expectations of privacy are not earthbound.

The Fourth Amendment guards the privacy of

human activity from aerial no less than terrestrial

invasion. At a recent but relatively primitive time,

an X-2 plane could spy on ground activities from

a height of 50,000 feet. Today’s sophisticated

technology permits overflights by vehicles orbiting

at an altitude of several hundred miles. Tomor-

row’s sophisticated technology will supply optic

and photographic devices for minute observations

B-30

from extended heights. Judicial implementations

of the Fourth Amendment need constant accom-

modation to the ever-intensifying technology of

surveillance. In analyzing claims of immunity

from aerial surveillance by agents of government,

the observer's altitude is a minor factor. Hori-

zontal extensions of the occupant’s terrestrial

activity form a more realistic and reliable measure

of privacy than the vertical dimension of altitude

... Reasonable expectations of privacy may as-

cend into the airspace and claim Fourth Amenc-

ment protection.

The conclusion of this brief turn-around of the

“reasonableness” question is that a society which views

certain forms of visually enhanced governmental surveil-

lance as unreasonable, would likely accept as reasonable,

Dow’s expectation to be free from this form of intrusion.

A final argument raised by EPA, which, at first blush,

is not without a good deal of merit, is that the public

interest in effective pollution control outweighs any pri-

vacy expectation which Dow may have. United States v.

Martinez-Fuerte, 428 U.S. 543, 555, 96 S.Ct. 3074, 3081, 49

L.Ed.2d 1116 (1976). In this regard EPA emphasizes the

utility of warrantless aerial overflights and photography

as a tool to monitor compliance with the federal pollu-

tion laws.

All of us certainly recognize the need for aggressive

and effective pollution control. In this regard we, as citi-

zens, certainly desire EPA to possess all the tools neces-

sary to carry out its legislative mandate to effectuate and

enforce the federal pollution laws. For 2 reasons,

however, EPA’s “public interest — pollution control”

argument does not outweigh Dow’s expectation of pri-

vacy under the facts of this case.

B-31

First, the Court finds very little pollution control

utility in the investigatory method used by EPA in this

case. EPA asserts that it had 2 purposes for the over-

flight: to get photographs of the “general layout of the

plant in relation to the power houses,” and to confirm

“excess emissions from the power houses.” (EPA Brief at

21). The facts are uncontroverted, however, that Dow

had earlier given schematic drawings of the power

houses to EPA voluntarily. EPA could have made fur-

ther requests for similar drawings, maps, or even photo-

graphs, of the general layout from Dow. Furthermore, it

is difficult to place credence in EPA’s assertion that a

goal of the aerial photography was to confirm excess

emissions. EPA had little or no control over when the

photographs would be taken by Abrams, and no knowl-

edge of whether there would be any emissions at the

moment they were taken.

A second reason militating against EPA’s position is

that it is difficult to justify a need for the agency to

conduct warrantless aerial searches. It appears to the

Court that at a minimum,”® an ex parte warrant proce-

dure would best strike the balance between Dow’s

expectation of privacy and EPA’s asserted need to

conduct surprise inspections of this sort. See generally

Note, Rationalizing Administrative Searches, 77 Mich.L.Rev.

1291, 1329 n. 184 (1979). As well stated by one com-

mentator, “since the normal inspection procedure for

EPA requires some advance preparation and advance

decisions concerning which facilities to inspect, the addi-

tional step of obtaining a search warrant does not seem

to be a tremendous burden in light of the constitutional

rights involve...’ Martin, EPA and Administrative Inspec-

tions, 7 Fla. St.L.Rev. 123, 130 (1979); see also EPA

20 See n. 27 infra

B-32

Memorandum on Inspection Procedures, 41 Envir.Rep.

(BNA) 2451, 2452 (April 11, 1979).

In terms of policy considerations, the public interest in

governmental compliance with constitutional and statu-

tory provisions is also involved in this case. United States

v. Martinez-Fuerte, supra. This consideration would

appear to lend support to Dow’s assertion that its pri-

vacy expectation is one which society is prepared to

accept as reasonable.

For all these reasons, the Court finds that Dow has

exhibited an actual expectation of privacy, ard that that

expectation is one the society is prepared to recognize as

reasonable. Therefore, under a Katz analysis, the Court

again concludes that EPA’s aerial photography of Dow’s

plant constituted an unreasonable search in violation of

the Fourth Amendment.

D. “Open Fields”

In Hester v. United States, 265 U.S. 57, 59, 44 S.Ct. 445,

446, 68 L.Ed. 898 (1924) the Supreme Court held that

“the special protection accorded by the Fourth Amend-

ment ... is not extended to the open fields.” In other

words a visual observation of something in plain view

— i.e. observable by members of the public — does not

constitute a search within the meaning of the Fourth

Amendment.”' This ruling was followed in Air Pollution

Variance Bd. v. Western Alfalfa Corp., 416 U.S. 861, 94

S.Ct. 2114, 40 L.Ed.2d 607 (1974), which involved a

constitutional challenge to a health inspector's warrant-

less observation of “plumes of smoke being emitted

1 The “plain view” doctrine of Coolidge v. New Hampshire, 403

U.S. 433, 464-468, 91 S.Ct. 2022, 2037-2039, 20 L.Ed.2d 564 (1971) is

not involved in this case. That doctrine is not a justification to

search, but a reason to extend an otherwise valid search. See Wilson

v. Health and Hospital Corporation of Marion City, 620 F.2d 1201, 1209

(CA 7, 1980).

B-33

from ... chimneys” on the premises of a corporation.

Id. at 863, 94 S.Ct. at 2115. The Court held that, “the

field inspector dia not enter the plant of offices . . . He

had cited what anvone in the city who was near the

plant could see in the sky — plumes of smoke .. .

[therefore] he was well within the ‘open fields’ exception

. approved in Hester.” Id. at 864-865, 94 S. Ct. at

2115-2116.

EPA asserts that the “open fields” exception applies in

this case and therefore validates its actions. In addition

to the foregoing authority, EPA cites 2 recent federal

cases, United States v. Allen, 633 F.2d 1288 (CA 9, 1980),

cert. denied, _. U.S. —., 102 S.Ct. 133, 70 L.Ed.2d 112

(1981), and United States v. DeBacker, 493 F.Supp. 1078

(WD Mich., 1980), and 9 state cases” in support of its

position. This Court finds the cases cited either distin-

guishable or nondispositive, and concludes that the

“open fields” exception does not apply in this case.

In United States v. Oliver, 657 F.2d 85 (CA 6, 1981), the

Sixth Circuit relying upon the rationale of Katz, held that

“the ‘open fields’ exception to the warrant requirement

can no longer be automatically invoked to validate a

warrantless search and seizure ...” Id. at 87-88. The

Court explained that “Katz shifted the emphasis of the

test [for determining the legality of a warrantless search]

from an inquiry into commonlaw property distinctions

22 People v. St. Amour, 104 Cal.App.3d 886, 163 Cal.Rptr. 187

(1980); People v. Lashmett, 71 Ill.App.3d 429, 27 Ill.Dec. 657, 389

N.E.2d 888 (1979); Burkholder v. Superior Court, 96 Cal.App.3d 421,

158 Cal.Rptr. 86 (1979); State v. Brighter, 589 P.2d 527 (Haw. 1979);

State v. Stachler, 570 P.2d 1323 (Haw. 1977); Plunkett v. City of

L.Ed.2d 787 (1978); People v. Superior Court, 37 Cal.App.3d 836, 112

Cal.Rptr. 764 (1974); Dean v. Superior Ct., 35 Cal.App.3d 112, 110

Cal.Rptr. 585 (1973).

B-34

to an inquiry in which the . . . reasonable expectations

of privacy became the focal point.” Id. It then concluded

that:

... Oliver's expectation of privacy was objec-

tively reasonable. Society’s interest in law enforce-

ment is not unduly hampered by requiring a warrant

prior to searching a private field which has been

reached through a private road exhibiting several “No

Trespassing” signs and blocked by @ locked gate,

unless there is an imminent threat of destruction

of the evidence or there exists a high probability

that the evidence will cause serious bodily harm.

We are presented with no such emergency situa-

tion here.

Id. at 87 (emphasis added). See also United States v.

Mullinex, 508 F.Supp. 512, 514 (ED Ky., 1980).

The Court has already found that Dow’s expectation

of privacy was objectively reasonable. In accordance

with Oliver, therefore, society's interest in the enforce-

ment of pollution laws is not unduly hampered by

requiring a warrant prior to EPA’s aerial search of a

private manufacturing plant which is reasonably secured,

especially after EPA is specifically refused entry.

Other factors take this case out of the “open fields”

exception as well. As previously stated, the exception

has the effect of making a plain view observation a non-

search. Such a result, however, would be anomalous in

this case. EPA has already admitted that it was engaged

in a “search” and a “quest for evidence.”~ Therefore,

the question before this Court is really limited to whether

that admitted search was unreasonable under the Fourth

Amendment.

23 See note 4 and text accompanying, supra.

B-35

The Court has already described why it finds that the

EPA aerial photographs “more closely approximate a

view of the interior of the plant than the exterior.”** This

distinction is relevant to the “open fields” inquiry. See

Wilson v. Health & Hospital Corporation of Marion City, 620

F.2d 1201, 1210 (CA 7, 1980). EPA was able to observe a

great deal more than “what anyone in the city who was

near the plant could see,” Air Pollution Variance Bd.,

supra, in its detailed aerial photographs. Granted, other

aircraft fly in the vicinity of the Dow plant on occasion.

The persons in those aircraft are likely able to observe

Dow’s plant below. But it is unlikely that those persons

are able to see minute, internal details of the plant,

without the type of equipment used by EPA.

One commentator, writing specifically about this case,

made the following observation:

The recently filed Dow Chemical case against

EPA seems to involve a fact situation where the

open fields exception may have some applicabil-

ity. However, aerial surveillance would seem to

push the exception too far. Although E.I. duPont

de Nemours and Co. Inc. v. Christopher, 431 F.2d

1012 (5th Cir., 1970), cert denied 400 U.S. 1024 [91

S.Ct. 581, 27 L.Ed.2d 637,] rehearing denied, 401

U.S. 967 [91 S.Ct. 968, 28 L.Ed.2d 250] (1971),

involved industrial espionage carried out by

means of aerial surveillance, what the court said

there would seem to apply at least in spirit to the

Dow Chemical case:

[We] realize that industrial espionage of the

sort here perpetrated has become a popular

sport in some segments of our industrial

24 See note 3 and text accompanying, supra.

B-36

community. However, our devotion to free

wheeling industrial competition must not

force us into accepting the law of the jungle

as the standard of morality expected in our

commercial relations.

431 F.2d at 1016. The important question that has

to be faced is what is constitutionally offensive

scrutiny. It would be fallacious to extend the

open fields exception to the facts in Dow because

if it were, advanced technology has given us

microphones and cameras that can make an

enclosed room an “open field.” Spatially based

criteria of eligibility for fourth amendment protec-

tion ignore the pertinent question as to what it is

we wish to see preserved from the offensive

scrutiny.

Martin, EPA and Administrative Inspections, 7

Fla.St.L.Rev. 123, 134 n. 50 (1979). This viewpoint is in

accord with the holding of United States v. Oliver, supra,

and this Court’s factual findings under Katz. See also

United States v. Taborda, 635 F.2d 131, 139 (CA 2, 1980).

The federal cases cited by EPA do not control this

case.*> While both involved aerial surveillance, both are

25 Neither do the state cases. supra note 22. All of the cases

involved aerial observation of contraband. The Sixth Circuit has

stated that, “for Fourth Amendment purposes, there is a clear

distinction between contraband and other property.” United States v.

Bailey, 628 F.2d 938, 944 (CA 6, 1980); but see United States v. Taborda,

635 F.2d 131, 138-139 n. 10 (CA 2, 1980). The Court has no quarrel

with the holding of these cases that, as a general proposition of law,

“a subjective desire to hide contraband from aerial surveillance is not

sufficient to establish the requisite reasonable expectation of

privacy.” People v. St. Amour, 163 Cal.Rptr. at 191. As applied to the

facts of this noncriminal case, however, that proposition cannot with-

stand constitutional scrutiny. Rather, this case fits within the holding

that, “in order to be constitutionally protected from overflights, the

person must show that the land in question is expected to be private

according to the common habits of persons engaged in [business].”

Id. Cl , Dow has made such a showing.

B-37

legally and factually distinguishable. In United States v.

Allen, 633 F.2d 1282, 1290 (CA 9, 1980), cert denied, —

U.S. —, 102 S.Ct. 133, 70 L.Ed.2d 112 (1981), the Court

found that “the defendants did not have a reasonable

expectation (of privacy)” due to the following factors:

... The Allen Ranch is virtually on the United

States sea-coast border . . . and Coast Guard heli-

copters routinely traversed the nearby air space

for several reasons, including law enforcement.

The residents of the Allen Ranch would, no

doubt, have been aware of these routine flights

and any reasonable person, cognizant of the

ranch’s proximity to the coastline and the Coast

Guard’s well-known function of sea-coast patrol

and surveillance, could expect that government

officers conducting such flights would be aided

by sophisticated electronic equipment. As such,

the residents could not reasonably bear a subjective

expectation of privacy from the Coast Guard's airborne

telephotographic scrutiny, particularly where, as

here, the objects observed were large scale modi-

fications of the Allen Ranch landscape and barn.

Id. (emphasis added). Further discussion of Allen is

unnecessary. Likewise, United States v. DeBacker, 493

F.Supp. 1078 (WD Mich., 1980) is also distinguishable.

There the Court found that, “defendant's relatively

minor expectations of privacy do not outweigh the value

to society in permitting such non-intrusive surveillance.”

Id. at 1081. Unlike this case, the aerial observation in

DeBacker was unenhanced by visual aids such as a

sophisticated camera. Also, the Court specifically noted

that “airplane flights over local farm lands at low alti-

tudes (200 feet) are not infrequent ...” Id. The same

cannot be said of flights over Dow’s chemical manufac-

turing facility. Accord, United States v. Mullinex, 508

F.Supp. 512, 514-515 (ED Ky., 1980).

B-38

For these reasons, the Court finds that the “open

fields” exception neither takes this case out of the

purview of the Fourth Amendment, nor in any way

alters this Court's earlier conclusion that EPA’s conduct

was unreasonable thereunder.

FIFTH AMENDMENT

[9] Dow has summarized its Fifth Amendment claim

as follows: “that the surreptitious reconnaissance flights

over Dow’s Midland plant . . ., together with the photo-

graphs taken of the plant by EPA and its contractor

constitute a taking of property [i.e. trade secrets and

other proprietary information] without due process of

law.” (Dow Response Brief at 2). On various factual and

jurisdictional grounds, EPA has moved for summary

judgment on this claim.

In its Reply Brief EPA states that it does “not disagree

with Dow’s assessment that disputed issues of fact still

remain with regard to the question of whether Dow in

fact has any trade secrets and whether any such trade

secrets are discernable in the aerial photographs

obtained by EPA .. .” (EPA Reply Brief at 8). For this

reason, the Court hereby DENIES EPA’s motion for

summary judgment on this claim. F.R. Civ.P.56(c)”°

26 As the Court reads the complaint regarding the Fifth Amend-

ment claim, the following material facts, as alleged by Dow, are still

in dispute:

1) Dow has protectable trade secrets in its Midland plant and

consequently, Dow has exercised the reasonable

degree of secrecy for the protection of such secrets.

2) The photographs taken by the EPA in its aerial surveillance

of the Dow gave the EPA possession of valuable

B-39

CLEAN AIR ACT

[10] Dow has raised 2 separate statutory sub-issues in

this case: first, whether EPA is authorized under Section

114 of the Clean Air Act, 42 U.S.C. § 7414, to use aerial

photography as an investigation tool; and second,

whether EPA’s sole and exclusive remedy when refused

entry is to seek injunctive relief under Section 113 of the

Clean Air Act, 42 U.S.C. § 7413. EPA’s position is that

Section 114 implictly authorizes it to use aerial photo-

graphy. EPA also contends that the agency is not

required to seek injunctive relief when entry is refused,

and need only secure an ex parte warrant. The Court

finds that only the former question — as to EPA’s

authority under Section 114 — is ripe for decision in this

case.” Therefore the Court will leave the latter issue for

another day.

A. Use of Aerial Photography

Section 114 of the Clean Air Act, 42 U.S.C. § 7414,

governs the authority of EPA to enter and conduct

(continued from preceding page)

The Court rejects EPA’s claim that it lacks subject matter jurisdiction

to issue the declaratory and injunctive relief sought by Dow. The

Court is vested with such jurisdiction under 28 U.S.C. § 1331, 5

U.S.C. § 702, and 28 U.S.C. §§ 2201-2202. See e.g. Public Service Co. of

Indiana v. U.S.E.P.A., 509 F.Supp. 720, 721 (SD Ind., 1981).

”” Under the facts of this case, an “actual controversy” regarding

the Section 113 issue has not been presented within the meaning of

the Declaratory Judgment Act, 28 U.S.C. § 2201. See Lake Carriers

Assoc. v. MacMullan, 406 U.S. 498, 506, 92 S.Ct. 1749, 1755, 32

L.Ed.2d 257 (1972). Had EPA secured, or even attempted to secure,

an ex parte warrant prior to the flyover, the issue would be justici-

Oe Dat ae Sentai eae eae i , this very issue

is about to ded by the United States Court of Appeals for the

B-40

inspections of emissions sources. In relevant part,

Section 114 provides:

(a) For the purpose ... (ii) of determining

whether any person is in violation of any such

standard or any requirement of such a plan, or

(iii) carrying out any provision of this chapter

(2) the Administrator or his authorized represen-

tative, upon presentation of his credentials —

(A) shall have a right of entry to, upon or

through any premises of such person or in

which any records required to be main-

tained under paragraph (1) of this section

are located, and

(B) may at reasonable times have access to and

copy any records, inspect any monitoring

equipment or method required under para-

graph (1) and sample any emissions which

such person is required to sample under

paragraph (1).

This statute expressly authorizes EPA to enter a facility to

determine whether the applicable Clean Air Act require-

ments are being complied with, to have access to

records and reports, to inspect any emissions monitoring

equipment, and to sample emissions. The question

before the Court in this case is what implied authority is

granted to EPA under the statute.”®

8 At the outset EPA maintains that its actions did not ccnstitute

an “entry.” This Court agrees. The real issue, however, is not

whether the aerial surveillance constituted an entry, but whether

Section 114 authorizes EPA to use overflights as an investigatory

tool.

B-41

EPA asserts that where Congress has delegated broad

authority to an agency to implement a statute, such

delegation carries with it the implicit authority for the

agency to use all means and measures to effectuate the

legislatively mandated end. American Trucking Assoc. v.

United States, 344 U.S. 298, 308-313, 73 S.Ct. 307, 313-

316, 97 L.Ed. 337 (1952). Dow responds that the legisla-

tive scheme established in the Clean Air Act is expressly

and narrowly tapered to consist primarily of self-

reporting amd consented-to inspections.

As intimated previously, this Court believes that EPA

should be granted broad authority to carry out its legis-

lative mandate to enforce the federal pollution laws.

Congress recognized this need when it amended the

Clean Air Act in 1970:

The purpose of the legislation . . . is to speed up,

expand, and intensify the war against air pollu-

tion in the United States with a view to assuring

that the air we breathe throughout the Nation is

wholesome once again. The Air Quality Act of

1967 (Public Law 90-148) and its predecessor acts

have been instrumental in starting us off in this

direction. A review of achievements to date,

however, make abundantly clear that the strat-

egies which we ‘ave pursued in the war against

air pollution have been inadequate in several

important respects, and the methods employed

in implementing those strategies often have been

slow and less effective than they might have been.

H.R.Rep.No. 91-1146, 91st Cong. 2d Sess. 116, reprinted

in [1970] U.S.Code Cong. & Ad.News 5356. Despite this

recognition and statement of purpose, Congress did not

amend the statute to authorize EPA to use “all means

and measures” to monitor and enforce compliance with

the Act.

B-42

Nothing in the plain language of the statute, or its

sparse legislative history, suggests that Congress in-

tended that EPA be given authority to utilize aerial

surveillance and photography. In fact, 3 literal aspects of

Section 114 reveal a legislative will that EPA’s inves-

tigatory powers be limited to land-based examination of

emission sources.

Section 114(a)(2)(A) grants to EPA, or its “authorized

representative” :””

— a right of entry;

— to, upon, or through any premises;

— upon presentation of credentials.

An analysis of each of these phrases compels the conclu-

sion that aerial surveillance and photography by EPA is

not authorized under the statute, even by reasonable

implication.

A “right of entry” cannot be viewed as synonomous

with a “right to search.” Had Congress intended that

EPA be allowed to use aerial search techniques, it could

have considered granting the agency a broad “right to

search,” or could have specifically enumerated aerial

surveillance as among the permissible methods of moni-

toring and inspection. But a “right of entry,” in literal

terms, is something quite different. The noun “entry”

denotes the physical act of admission or ingress into a

given area. The fact that Congress used the phrase

“right of entry,” suggests to this Court a common sense

29 No issue has been raised in this case as to whether Abrams

was EPA’s “authorized representative.” See e.g. Bunker Hill v.

U.S.E.P.A, 658 F.2d 1280 (CA 9, 1981); Stauffer Chemical Co. v. E.P.A.,

647 F.2d 1075 (CA 10, 1981); United States v. Stauffer Chemical Co., 511

F.Supp. 744 (MD Tenn., 1981); appeal docketed no. 81-5311 (CA 6,

May 4, 1981); Public Service Co. Indiana v. U.S.E.P.A., 509 F.Supp.

720 (SD Ind., 1981).

B-43

interpretation, leading to the conclusion that EPA’s

intended inspection authority is land-based.

The phrase “to, upon or through any premises,”

further defines the nature of EPA’s statutory right of

entry. In conjunction with the term “entry,” the adverbs

“to, upon, or through” more logically reveal that Con-

gress had in mind an earthbound inspection scheme for

EPA, rather than one from above looking down.

Finally, it would be paradoxical for this Court to find

an implied right to use surreptitious overflights, in a

statute expressly requiring the “presentation of . . . cre-

dentials” by the inspecting EPA official. The Court is not

prepared to ratify a procedure whereby an EPA official

appears at the gate of a facility, presents his credentials,

and then directs the inspected party’s attenuuon to the

aircraft flying overhead. Again, this clear legislative

expression supports the conclusion that EPA exceeded

its statutory authority under Section 114 in carrying out

the flyover and aerial photography of Dow’s plant.

EPA relies on 2 recent cases, In Re Clean Air Act Inspec-

tion of Bunker Hill, 15 ERC 1063 (D Idaho, 1980), affirmed

sub. nom, Bunker Hill Co. v. U.S.E.P.A., 658 F.2d 1280

(CA 9, 1981) and Public Service Co. of Indiana Inc. v.

U.S.E.P.A., 509 F.Supp. 720 (SD Ind., 1981), for the

proposition that “EPA’s implicit authority to take photo-

graphs of a facility ... necessarily arises out of its

explicit authority in Section 114 of the Act” (EPA Brief

at 32-33). EPA’s position, and the authority on which it

relies, are sound. Section 114 can and should be read as

impliedly authorizing the use of photography of a

facility which is the subject of an on-site inspection.

Neither Section 114, nor the cases cited, however, im-

pliedly authorize surreptitious aerial photography.

B-44

Both the Bunker Hill and Public Service Company case

involved the taking of photographs during on-site, land-

based inspections by EPA. In separate conclusions of

law the Court in Bunker Hill held that:

10. The Environmental Protection Agency has

authority under Section 114 of the Clean Air Act

to take photographs of the facilities and equip-

ment it inspects.

11. The Bunker Hill Company cannot require the

Environmental Protection Agency or its private

contractors duly authorized as representatives of

the EPA Administrator to submit film to Bunker

Hill for development and screening for possible

confidentiality concerns. The Bunker Hill Com-

pany may, however, claim that any or all of the

information depicted in photographs taken by

EPA during a Section 114 inspection is confiden-

tial, and secure to such photographs the protec-

tions provided by 40 CFR 2.201 et seq.

15 ERC at 1066. Similarly, in Public Service Company, a

decision limited to its own facts, the Court held that

EPA’s taking of photographs to pinpoint and cite viola-

tions was “not improper.” 509 F.Supp. at 726. This

Court agrees with these holdings, but finds that they are

not dispositive of the issue in this case.

Aerial surveillance and photography is not authorized,

either expressly or impliedly, by Section 114 of the Clean

Air Act. To find otherwise would be to undermine the

apparent Congressional purpose that only land-based

inspections be utilized, to negate the specific require-

ment that EPA inspectors present their credentials at the

time of the inspection, and to circumvent the inspected

parties’ right to state claims of confidentiality. 42 U.S.C.

§ 7414(c); 40 CFR 2.201 et seq.

B-45

V.

CONCLUSION

In summary, the Court concludes that the EPA flyover

and aerial photography of Dow’s plant consitituted an

unreasonable search in vioiation of the Fourth Amend-

ment. In addition, the Court finds that EPA exceeded its

statutory authority under Section 114 of the Clean Air

Act, 42 U.S.C. § 7414, in using this method of inspection.

Accordingly, the Court hereby GRANTS Dow’s motion

for partial summary judgment and DENIES EPA’s cross-

motion for summary judgment. On this basis;

IT IS HEREBY ORDERED AND ADJUDGED that EPA is

permanently enjoined and restrained from conducting

future aerial surveillance and photography of the Dow

Chemical manufacturing facility in Midland, Michigan.

IT IS SO ORDERED.

C-1

APPENDIX C

EXCERPTS FROM RESTATEMENT OF TORTS § 757 (1939)

RESTATEMENT OF TORTS

* * *

§ 757. LIABILITY FOR DISCLOSURE OR USE

OF ANOTHER’S TRADE SECRET —

GENERAL PRINCIPLE.

One who discloses or uses another’s trade secret,

without a privilege to do so, is liable to the other if

(a)

(b)

(c)

(d)

Comment:

he discovered the secret by improper means,

or

his disclosure or use constitutes a breach of

confidence reposed in him by the other in

disclosing the secret to him, or

he learned the secret from a third person

with notice of the facts that it was a secret

and that the third person discovered it by

improper means or that the third person's

disclosure of it was otherwise a breach of his

duty to the other, or

he learned the secret with notice of the facts

that it was a secret and that its disclosure

was made to him by mistake.

** *

b. Definition of trade secret. A trade secret may consist

of any formula, pattern, device or compilation of infor-

mation which is used in one’s business, and which gives

him an opportunity to obtain an advantage over com-

C-2

petitors who do not know or use it. It may be a formula

for a chemical compound, a process of manufacturing,

treating or preserving materials, a pattern for a machine

or other device, or a list of customers. It differs from

other secret information in a business (see § 759) in that

it is not simply information as to single or ephemeral

events in the conduct of the business, as, for example,

the amount or other terms of a secret bid for a contract

or the salary of certain employees, or the security invest-

ments made or contemplated, or the date fixed for the

announcement of a new policy or for bringing out a new

model or the like. A trade secret is a process or device

for continuous use in the operation of the business.

Generally it relates to the production of goods, as, for

example, a machine or formula for the production of an

article. It may, however, relate to the sale of goods or

to other operations in the business, such as a code for

determining discounts, rebates or other concessions in a

price list or catalogue, or a list of specialized customers, or

a method of bookkeeping or other office management.

* + *

D-1

APPENDIX D

EXCERPTS FROM UNIFORM TRADE SECRETS ACT

UNIFORM TRADE SECRETS ACT

§ 1. [Definitions]

As used in this Act, unless the context requires other-

wise:

(1) “Improper means” includes theft, bribery, misrep-

resentation, breach or inducement of a breach of a

duty to maintain secrecy, or espionage through

electronic or other means;

(2) “Misappropriation” means:

(i) acquisition of a trade secret of another by a

person who knows or has reason to know that

the trade secret was acquired by improper

means; or

(ii) disclosure or use of a trade secret of another

without express or implied consent by a per-

son who

(A) used improper means to acquire knowledge

of the trade secret; or

(B) at the time of disclosure or use, knew or

had reason to know that his knowledge of

the trade secret was

(I) derived from or through a person who

had utilized improper means to ac-

quire it;

(II) acquired under circumstances giving

rise to a duty to maintain its secrecy

or limit its use; or

D-2

(III) derived from or through a person who

owed a duty to the person seeking re-

lief to maintain its secrecy or limit its

use; Or

(C) before a material change of his position,

knew or had reason to know that it was a

trade secret and that knowledge of it had

been acquired by accident or mistake.

(3) “Person” means a natural person, corporation,

business trust, estate, partnership, association,

joint venture, government, governmental subdivi-

sion or agency, or any other legal or commercial

entity.

(4) “Trade secret” means information, including a for-

mula, pattern, compilation, program, device,

method, technique, or process, that:

(i) derives independent economic value, actual or

potential, from not being generally known to,

and not being readily ascertainable by proper

means by, other persons who can obtain eco-

nomic value from its disclosure or use, and

(ii) is the subject of efforts that are reasonable

under the circumstances to maintain its secrecy.

* + *

§ 2. [Injunctive Relief]

(a) Actual or threatened misappropriation may be en-

joined. Upon application to the court, an injunc-

tion shall be terminated when the trade secret has

ceased to exist, but the injunction may be con-

tinued for an additional reasonable period of time

in order to eliminate commercial advantage that

otherwise would be derived from the misappropri-

ation.

D-3

(b) If the court determines that it would be unreason-

(c)

§ 3.

(a)

(b)

§ 4.

able to prohibit future use, an injunction may con-

dition future use upon payment of a reasonable

royalty for no longer than the period of time the

use could have been prohibited.

In appropriate circumstances, affirmative acts to

protect a trade secret may be compelled by court

order.

[Damages]

In addition to or in lieu of injunctive relief, a com-

plainant may recover damages for the actual loss

caused by misappropriation. A complainant also

may recover for the unjust enrichment caused by

misappropriation that is not taken into account in

computing damages for actual loss.

If willful and malicious misappropriation exists,

the court may award exemplary damages in an

amount not exceeding twice any award made

under subsection (a).

* + *

[Attorney's Fees]

If (i) a claim of misappropriation is made in bad faith,

(ii) a motion to terminate an injunction is made or re-

sisted in bad faith, or (iii) willful and malicious misap-

propriation exists, the court may award reasonable

attorney’s fees to the prevailing party.

** *

D-4

§ 5. [Preservation of Secrecy]

In an action under this Act, a court shall preserve the

secrecy of an alleged trade secret by reasonable means,

which may include granting protective orders in connec-

tion with discovery proceedings, holding in-camera

hearings, sealing the records of the action, and ordering

any person involved in the litigation not to disclose an

alleged trade secret without prior court approval.

* * *

§ 6. [Statute of Limitations]

An action for misappropriation must be brought with-

in 3 years after the misappropriation is discovered or by

the exercise of reasonable diligence should have been

discovered. For the purposes of this section, a con-

tinuing misappropriation constitutes a single claim.

* * *

§ 7. [Effect on Other Law]

(a) This Act displaces conflicting tort, restitutionary,

and other law of this State pertaining to civil liabil-

ity for misappropriation of a trade secret.

(bo) This Act does not affect:

(1) contractual or other civil liability or relief that

is not based upon misappropriation of a trade

secret; or

(2) criminal liability for misappropriation of a trade

secret.

* * *

§ 8. [Uniformity of Application and Construction]

This Act shall be applied and construed to effectuate

its general purpose to make uniform the law with re-

spect to the subject of this Act among states enacting it.

D-5

* + *

§ 9. [Short Title]

This Act may be cited as the Uniform Trade Secrets

Act.

§ 10. [Severability]

If any provision of this Act or its application to any

person or circumstances is held invalid, the invalidity

does not affect other provisions or applications of the

Act which can be given effect without the invalid provi-

sion or application, and to this end the provisions of this

Act are severable.

* * *

§ 11. [Time of Taking Effect]

This Act takes effect on ___, and does not apply to

misappropriation occurring prior to the effective date.

§ 12. [Repeal]

The following Acts and parts of Acts are repealed:

(1)

(2)

(3)

Historical Note

The Uniform Trade Secrets Act was approved by the

National Conference of Commissioners on Uniform State

Laws in 1979.

D-6

TABLE OF JURISDICTIONS WHEREIN ACT HAS BEEN ADOPTED

Jurtediction Lows a - Statutory Citation

Connecticut . 1963, No. 344 6-23-1963"

Deleware ...... 1982 [63 Del.

c. 218 415-1982 6 Deil.C. §§ 2001 to 2008.

indiana ........ 1982, No. 1257 2-25-1982" West's ALC. 24-2-3-1 to 242-3-8

Kaneas ........ 1981, c. 214 7-1-1981 K.S.A. 60-3320 to 60-3330.

Louisiana ...... 1981, No. 462 7-19-1981 LSA-R.S. 51:1431 to 51:1439.

Minnesota ..... 1980, ch. 504 1-1-1981 M.3.A. §§ 325C.01 to 325C.08.

Washington . 1981, c. 286 1-1-1982 West's RCWA 19.108.010 to 19.108.940.

Date of approval.

E-1

APPENDIX E

RELEVANT MICHIGAN COMPILED LAWS

M.C.L. § 750.539a and 750.539d

750.539a Definitions

Sec. 539a. As used in sections 539a to 539i:

(1) “Private place” means a place where one may rea-

(2)

(3)

(4)

sonably expect to be safe from casual or hostile

intrusion or surveillance but does not include a

place to which the public or substantial group of

the public has access.

“Eavesdrop” or “eavesdropping” means to over-

hear, record, amplify or transmit any part of the

private discourse of others without the permission

of all persons engaged in the discourse. Neither

this definition or any other provision of this act

shall modify or affect any law or regulation con-

cerning interception, divulgence or recording of

messages transmitted by communications common

carriers.

“Surveillance” means to secretly observe the activi-

ties of another person for the purpose of spying

upon and invading the privacy of the person

observed.

“Person” means any individual, partnership, cor-

poration or association. P.A.1931, No. 328, § 539a,

added by P.A.1966, No. 319, § 1, Eff. March 10,

1967.

E-2

750.539d Installation of device for observing, photographing

or eavesdropping in private place

Sec. 539d. Any person who installs in any private

place, without the consent of the person or persons enti-

tled to privacy there, any device for observing, photo-

graphing, or eavesdropping upon the sounds or events

in such place, or uses any such unauthorized installa-

tion, is guilty of a felony punishable by imprisonment in

a state prison for not more than 2 years or by a fine of

not more than $2,000.00, or both. P.A.1931, No. 328,

§ 539d, added by P.A.1966, No. 319, § 1, Eff. March 10,

1967.

M.C.L. § 752.771 AND M.C.L. § 752.772

TRADE SECRETS — STEALING, EMBEZZLING OR COPYING

752.771. Definitions

Sec. 1. As used in this act:

(1) “Article” means any object, material, device or

substance or copy thereof, including any writing,

record, recording, drawing, sample, specimen,

prototype model, photograph, microorganism,

blueprint or map.

(2) “Representing” means describing, depicting, con-

taining, constituting, reflecting or recording.

(3) “Trade secret” means the whole or any portion or

phase of any scientific technical information, de-

sign, process, procedure, formula or improvement

which is secret and of value; and a trade secret is

considered to be secret when the owner thereof

takes measures to prevent it from becoming avail-

able to persons other than those selected by the

owner to have access thereto for limited purposes.

~

E-3

(4) “Copy” means any facsimile, replica, photograph

or other reproduction of an article, and any note,

drawing or sketch made of or from an article.

P.A.1968, No. 329, § 1, Eff. Nov. 15.

**+* *

752.772. Depriving, withholding, etc., trade secrets;

penalty, misdemeanor

Sec. 2. Any person who, with intent to deprive or

withhold from the owner thereof the control of a trade

secret, or with an intent to appropriate a trade secret to

his own use or to the use of another, steals or embezzles

an article representing a trade secret or without author-

ity makes or causes to be made a copy of an article

representing a trade secret, is guilty of a misdemeanor

and shall be fined not more than $1,000.00 or impris-

oned for not more than 1 year, or both.

P.A.1968, No. 329, § 2, Eff. Nov. 15.

* *+ *

F-1

APPENDIX F

EXCERPT FROM DEPOSITION OF J. WAIT (DOW),

5/10/78, PAGES 13-14

** *

(13) * * * Q. Now, are you aware, sir, of any mea-

sures that could be taken to prevent aerial photography

of the chloralkali plant in Midland?

A. As it stands today I’m not aware.

Q. Can you envisage anything that could be done to

prevent aerial photography of the facilities?

A. I suppose it would be possible to build a roof

over such a plant.

Q. How large is the plant?

A. It covers 30 acres.

Q. From your standpoint as an engineer would that

be a practical alternative?

A. Absolutely not practical.

Q. Have you any idea what the cost would be to

roof the chloralkali plant in Midland?

A. It would be extremely difficult to estimate the cost

but I would think that you could not do it for less than

$15,000,000.

Q. Would there be anything required other than a —

other than the (14) erection of a roof over the facilities?

A. Well, the roof alone would introduce a lot of

problems. There would be a lot of side effects from such

a thing. But the roof alone would probably tend to hide

the biggest part of the operation.

Q. To maintain the operation of the chloralkali facil-

ity would you have to expend any sums of money for

items other than the roof itself?

A. Yes, the maintenance would become far more dif-

ficult. For example, today we use giant mobile cranes to

move equipment from one place to another during

F-2

routine maintenance. These cranes, some of them are as

high as 100 or 125 feet. Obviously a roof would not be

practical that high so large bridge cranes would have to

be installed permanently within the roof which would

be extremely expensive. The capacities of some of these

things would run into the range of a hundred thousand

pounds lift capability so it would be an extemely difficult

arrangement.

G-1

APPENDIX G

NON-FULLY OWNED SUBSIDIARIES AND AFFILIATES

OF THE DOW CHEMICAL COMPANY

AS OF DECEMBER 31, 1984

Subsidiaries and affiliates owned both directly and in-

directly have been included. The company italicized is the

direct owner of the companies listed below it. “Dow’s”

percent ownership is indicated by each company.

SUBSIDIARIES

The Dow Chemical Company

Alamo Land Company, Inc. (56%)

Gruppo Lepetit S.p.A. (99%)

L.I.F.E. (Laboratorios Industriales Farmaceuticos

Ecuatorianos) (59%)

Laboratorios L.I.F.E. del Salvador S.A. (100%)

Negocios e Industrias S.A. “Neisa” (100%)

Pacific Chemical Berhad (51%)

Pacific Cable Products Sendirian Berhad (51%)

Ivon Watkins-Dow Ltd (51%)

Société Industrielle de Plastic et de L’acier S.A. (99%)

The Cynara Company (90%)

Dow Chemical A.G.

(A.G. owned 100% by The Dow Chemical Company)

Petroquimica Dow S.A. (70%)

AFFILIATES

The Dow Chemical Company

Dow Corning Corporation (50%)

Dowell Schlumberger Corporation (50%)

G-2

Dowell Schlumberger Incorporated (50%)

Compagnie des Services Dowell Schlumberger (50%)

El Dorado Terminals Company (50%)

Agro Quimica Maringa S.A. (20%)

Bank Mendes Gans (29%)

Chemi-Trol Chemical Company (23%)

DOKI (49%)

Estireno del Zulia C.A. (25%)

Ibafon Chemical Ltd (40%)

Oasis Pipeline Company (30%)

Package Machinery Company (29%)

Piramides Brazil (22%)

Total Raffinaderij Nederland N.V. (20%)

Zoo Agro de Venezuela C.A. (49%)

Al Miyah Chemicals (Ltd.) (49%)

Baratek (50%)

Boersele Hydrocracker B.V. (45%)

Insul/Crete Company, Inc. (50%)

Joliet Marine Terminal (50%)

Long Beach Marine Terminal (50%)

Metal Mark Inc. (50%)

Oronzio De Nora Impianti Elettrochimici S.A. (50%)

Sinor Corradini Navarra S.A. (50%)

Technovest Inc. (20%)

Bio-Ciencia/Lavosier Analysis Clinicas (40%)

Dow Chemical A.G. (A.G. is

owned 100% by The Dow Chemical Company)

Polychem Ltd (25%)

Coral Navigation (Coral is

owned 100% by The Dow Chemical Company)

Chief Shipping Company (50%)

Dow Chemical Company Ltd

(Ltd is 100% owned by Dow Chemical A.G.)

Cromarty Petroleum Company Ltd (50%)

G-3

Dow Chemical of Canada Ltd (Canada Ltd is

100% owned by The Dow Chemical Company)

Dowell Schlumberger Canada Inc. (50%)

Fort Saskatchewan Ethylene Storage Limited (50%)

Lawrason’s Chemical, Ltd (20%)

Wabiskaw Explorations Limited (50%)

Maligne Resources Limited (Maligne is

100% owned by Dow Chemical of Canada Ltd)

MT Partnership (50%)

Dow Chemical Africa (Pty) Limited (Africa is

100% owned by Dow Chemical A.G.)

JV Chemicals (50%)

Dow Chemical International Energy Company (Energy is

100% owned by The Dow Chemical Company)

Canmar International Drilling Co. (50%)

Dow Chemical S.p.A. (S.p.A. is

100% owned by Dow Chemical A.G.)

Corradini Poliuretani S.p.A. (50%)

Dow Chemical Iberica S.A. (Iberica is

100% owned by Dow Chemical A.G.)

Transformadora De Etileno (50%)

Dow Quimica S.A. (Quimica is

100% owned by The Dow Chemical Company)

Estireno Do Nordeste (33%)

Expansao Correctora De Seguros Ltda (33%)

G-4

Merrell Dow Franca S.A. (Merrell Dow Franca is

100% owne i by Merrell Dow Pharmaceuticals Inc.)

Biotic Algérie, S.A. (49%)

Biotic Maroc (49%)

Dofinco, Inc. (Dofinco is

100% owned by The Dow Chemical Company)

DCS Capital Partnership (33%)

DCS Capital Corporation (100%)

Dow Financial Services Corporation (Financial Services is

owned 100% by The Dow Chemical Company)

Dow Banking Corporation (78%)

Dow Scandia Holdings Vimited (52%)

Dow MBF Limited (54%)

MBF Leasing Hong Kong (26%)

MBF Leasing Kuala Lumpur (29%)

MBF Leasing Singapore (49%)