A federal case against a Kentucky man accused of creating cellular extension phones is expected to go to trial in what may be the first U.S. criminal case attacking the emulation business.
A four-count indictment was issued against Don Billy Yates by a federal grand jury in November. Yates’ attorney, R. Burl McCoy, argues that no law was broken and asked the court to dismiss the case.
U.S. District Judge Karl Forester heard initial arguments earlier this month and told attorneys he would research the matter, in consideration of dropping the charges. The judge decided Dec. 13 to allow the government’s allegations.
“We intend to defend this case vigorously because there was no attempt to defraud,” said McCoy. “And we will win.”
The government’s case springs from an alleged Secret Service sting. In September, an undercover agent contacted Yates and asked Yates if he could program a cellular phone to emulate the same electronic serial number of another cellular phone. Yates allegedly told the agent he could and the two met. Yates then programmed the phone so the undercover agent could use his existing cellular number on another cellular phone, according to court documents.
Several weeks later, Yates was indicted on four charges, all including the allegation “with intent to defraud,” producing, using and trafficking in a counterfeit access device; having control and possession of device-making equipment; trafficking, having a telecommunications instrument that has been altered “to obtain unauthorized use of telecommunications service;” and possessing hardware and software used to alter telecom instruments to gain unauthorized service.
The Federal Communications Commission has stated that every cellular phone must have an original ESN. Assistant U.S. Attorney Thomas Self in Lexington said that while the extension user would still pay airtime used on an extension phone, cellular operators are defrauded of activation fees and monthly service fees.
Numerous civil cases have been filed this year against businesses that provide emulation services, but the Lexington case is believed to be the first time criminal charges have been filed for this alleged violation.
Horizon Cellular, doing business in Lexington as Cellular One, said it was alarmed to see the man advertising on cable TV and setting up booths at public events, so Horizon cooperated with the Secret Service.
