"(3) Where the facilities from which, or the place where, the wire or oral communications are to be intercepted are being used, or are about to be used, or are leased to, listed in the name of, or commonly used by, a licensed physician, licensed lawyer, or practicing clergyman, or are premises used primarily for habitation or other domestic purposes, no warrant shall issue unless the judge, in addition to the requirements of section 3803, subsection (c) (1) or (2) of this Chapter determines that

"(A) such interceptions will be so conducted in such a way as to minimize or eliminate the number of interceptions of privileged wire or oral communications between licensed physicians and patients, licensed lawyers and clients, practicing clergymen and confidants, or husband and wife; and

"(B) there is a special need to authorize the interception of wire or oral communications over such facilities or in such places: Provided, That no such privileged wire or oral communication so intercepted shall be disclosed or used other than as it is necessary in the disclosure or use of wire or oral communications whose disclosure or use is authorized under this Chapter.

"(e) Contents of Order.-Each order granting leave to intercept any wire or oral communication shall specify

"(1) the nature and location of the communications facilities as to which, or the place where, leave to intercept is granted;

"(2) each offense as to which information is to be sought;

"(3) the identity of the agency authorized to intercept the communications; and

"(4) the period of time during which such interception is authorized.

"(f) Time Limit and Extensions of Order.-No order entered under this section may grant leave to intercept any wire or oral communication for any period exceeding forty-five days. Extensions of the order may be granted for periods of not more than twenty days each upon further application made in conformity to subsection (a) of this section and upon the findings required by subsection (c) of this section.

"(g) Emergency Interceptions.-Notwithstanding any other section of Chapter 120, or Chapter 240, Title 18, United States Code, any investigative or law enforcement officer who determines that an emergency situation exists requiring immediate action to intercept any wire or oral communication for which a warrant could be obtained under Chapter 240 and which would otherwise constitute, if intercepted, a violation of Chapter 120 solely because of the failure to obtain such warrant may intercept such wire or oral communication provided that an application for a warrant is made in accordance with Chapter 240, within forty-eight hours after the interception has occurred, or begins to occur, for the approval of the interception. In the event such application for approval is denied, the contents of any wire or oral communication intercepted shall be treated as provided for in section 3800 of this Chapter and in an inventory under section 3803 of this Chapter shall be filed.

"(h) Recording and Sealing of Contents of Intercepted Wire or Oral Communications and Applications. "(1) The contents of any wire or oral communication intercepted under the provisions of this Chapter shall, if possible, be recorded on tape or wire. Immediately upon the expiration of the period of the warrant, or renewals thereof, such tapes or wire recordings shall be made available to the judge issuing such warrant and sealed under his directions. Custody of the tapes or wire recordings shall be wherever the judge orders. They shall not be destroyed except upon an order of the issuing or denying judge and in any event shall be kept for ten years. Duplicate tapes or wire recordings may be made for use pursuant to the provisions of the section 3802 (a) and (b) of this Chapter for investigations. The presence of the seal provided for by this subsection, or a satisfactory explanation for the absence thereof, shall be a prerequisite for the disclosure of the contents of any wire or oral communication or evidence derived therefrom under section 3802 (c) or (d).

"(2) Applications made and orders granted under this Chapter shall be sealed by the judge. Custody of the applications and orders shall be wherever the judge directs. They shall not be disclosed except in accordance with this Chapter. They shall not be destroyed except on order of the issuing or denying judge and in any event shall be kept for ten years.

"(3) Any violation of the provisions of this subsection shall be punished as contempt of the issuing or denying judge.

"(i) Inventory.-Within a reasonable time but not later than one year after the termination of the period of the warrant or renewals thereof, the issuing judge shall cause to be served notice on the person or persons named in the warrant of—

"(1) the fact of the entry of the order;

"(2) the date of the entry and the period of authorized or approved interception; and

"(3) the fact that during the period wire or oral communications were or were not intercepted and recorded: Provided, That on an ex parte showing of good cause to a judge of competent jurisdiction the serving of a notice of inventory under this subsection may be postponed.

"(j) Notice of Intention. The contents of any intercepted wire or oral communication or evidence derived therefrom shall not be received in evidence or otherwise disclosed in any criminal proceeding in a Federal court, or in a State court, unless each defendant, not less than ten days before the trial, has been furnished with a copy of the court order under which the interception was authorized or by which the interception was approved. This ten day period may be waived by the judge if he finds that it was not possible to furnish the defendant with the above information ten days before the trial and that the defendant will not be prejudiced by the delay in receiving such information.

tee or other authority of the United States, or any State, or political subdivision thereof, may move to suppress the contents of any intercepted wire or oral communication or evidence derived therefrom on the grounds that—

"(A) the communication was unlawfully intercepted; (B) the order of authorization or approval under which it was intercepted is insufficient on its face;

"(C) there was no probable cause for believing the existence of the grounds on which the order of authorization or approval was issued; or

"(D) the interception was not made in conformity with the order of authorization or approval.

"Such motion shall be made before the trial, hearing, or proceeding unless opportunity therefor did not exist or the person was not aware of the grounds of the motion. If the motion is granted, the contents of the intercepted wire or oral communication or evidence derived therefrom

shall be treated as provided for in section 3800 of this Chapter.

"(2) In addition to any other right to appeal, the United States shall have the right to appeal from an order granting a motion to suppress under this Chapter where the United States Attorney shall certify to the judge or other official granting such motion that the appeal is not taken for purposes of delay. Any appeal under this Any appeal under this Chapter shall be taken within thirty days after the date the order was entered and shall be diligently prosecuted. "SEC. 3804. REPORTS CONCERNING INTERCEPTED WIRE OR ORAL COMMUNICATIONS.

"(a) Within thirty days after the refusal to grant or termination of the period of the warrant or renewals thereof, the issuing Federal or State judge shall cause to be transmitted to the Administrative Office of the United States Courts a report including―

"(1) the fact that an authorization or approval warrant was applied for;

"(2) the fact that it was granted as applied for or as modified;

"(3) the period of time including renewals for which it was issued;

"(4) the kind of warrant applied for under section 3803, subsection (c) (1) or (2) of this Chapter;

"(5) the offense or offenses specified in the warrant; and

"(6) the identity of the applying investigative or law enforcement officer's agency, and who authorized the application.

"(b) Within thirty days after the termination of the investigation, in connection with a warrant or renewal thereof was sought, or the trial or trials resulting therefrom, the Attorney General, or any Assistant Attorney General of the Department of Justice specially designated by the Attorney General, or the attorney general of the State, or the principal prosecuting attorney for any political subdivision thereof, shall cause to be transmitted to

the Administrative Office of the United States Courts a report including

"(1) the information specified in subsection (a) of this section;

"(2) the number of arrests resulting from the interceptions and the offenses for which the arrests were made; "(3) the number of trials resulting from the interceptions and the offenses for which the arrests were made; "(4) the number of motions to suppress made under this Chapter, and the number granted or denied; and "(5) the number of convictions resulting from the interceptions and the offenses for which the convictions were obtained.

"(c) In March of each year the Director of the Administrative Office of the United States Courts shall transmit to the Congress a full and complete report concerning the number of applications for authorization or approval which were made, granted, or denied during the preceding calendar year. Such report shall include a summary of the data required to be filed with the Administrative Office by subsections (a) and (b) of this section. "SEC. 3805. RECOVERY OF CIVIL DAMAGES AUTHORIZED.

"Any person whose wire or oral communication is intercepted, disclosed, or used in violation of section 2510 of Chapter 120, Title 18, United States Code, shall have a civil cause of action against any person who intercepts, discloses, or uses or procures any other person to intercept, disclose, or use such communication. Such person shall be entitled to recover from any such person or persons:

"(1) actual damages but not less than liquidated damages computed at the rate of $100 a day for each day of violation or a minimum recovery of $1,000;

"(2) punitive damages; and

"(3) attorney's fee and other litigation costs reasonably incurred: Provided, That good faith reliance on a court order shall constitute a complete defense.

"SEC. 3806. DEFINITIONS.

"As used in Chapters 120 and 240, Title 18, United States Code

"(1) The term "wire communication" means any communication made in whole or in part through the use of facilities for the transmission of communications by the aid of wire, cable, or other like connection between the point of origin and the point of reception furnished or operated by any person engaged as a common carrier in providing or operating such facilities for the transmission of interstate or foreign communications;

"(2) The term "oral communication" means any communication uttered within a private area not audible. outside of that area through the normal senses, or through subnormal senses corrected to not better than normal;

"(3) The term "moral turpitude" shall include, but not be limited to, murder, extortion, arson, bribery, per

jury, tax evasion, gambling (if that offense is punishable as a felony), the lending of money, or thing of value, at usurious rates, counterfeiting, bankruptcy, fraud, or any offense involving narcotics, or any conspiracy to commit any of the foregoing offenses;

"(4) The term "person aggrieved” means an individual who was a party to any intercepted wire or oral communication or any individual against whom the interception was directed;

"(5) The term "interstate communication" means any communication transmitted (a) from any State to any other State, or (b) within the District of Columbia or any possession of the United States;

"(6) The term "foreign communication" means any communication transmitted between the United States and any foreign country;

"(7) The term "State" means any State of the United States, the District of Columbia, the Commonwealth of Puerto Rico, and any possession of the United States;

"(8) The term "intercept" means the aural acquisition of the contents of any wire or oral communication through the use of any intercepting device by any person. other than the sender or receiver of such communication or a person given prior authority to by either;

"(9) The term "intercepting device" means any device or apparatus whatsoever other than an extension telephone instrument furnished to the subscriber or user by a communication common carrier in the ordinary course of its business as such carrier or a hearing aid or similar device which corrects subnormal hearing to not better than normal;

"(10) The term "contents," when used with respect to any wire or oral communication, includes any information. concerning the identity of the parties to such communication or the existence, contents, substance, purport, or meaning of that communication;

"(11) The term "person" means any officer, agent, or employee of the United States, or any State, or political subdivision thereof, or any individual, partnership, association, joint stock company, trust, or corporation;

"(12) The term "investigative or law enforcement officer" means any officer of the United States, or of a State, or political subdivision thereof, who is empowered by law to conduct investigations of or to make arrests for offenses described in section 3801 of this Chapter and any attorney authorized by law to prosecute or participate in the prosecution of such offenses; and

"(13) The term "judge of competent jurisdiction"

means

"(a) the chief judge of a United States district court, or such judge as he shall designate, or the chief judge of a United States court of appeals, or such judge as he shall designate, or the Circuit or Chief Justice of the United States, or such judge as he shall designate.

"(b) a judge of any court of general criminal jurisdiction of a State who is authorized by a statute of that State to enter orders granting leave to intercept any wire or oral communications."

SEC. 5.

STUDY

(a) Within one year prior to the termination of this Act, the Attorney General shall cause to be conducted by competent social scientists, an independent study of the operation of this Act. Following the completion of such study the Attorney General shall cause the results of such study to be reviewed by a Council of Advisers to be composed of nine individuals to be designated by him from all segments of life in the United States, including but not limited to, lawyers, teachers, artists, businessmen, newspapermen, jurists, policemen, and community leaders. Within sixty days following the completion of such review, the Attorney General shall report to the President and the Congress the results of such study and review together with the views and recommendations of the Council and the Attorney General.

(b) The Attorney General shall furnish to the Council an executive secretary and such secretarial, clerical, and other services as are deemed necessary to the conduct of its business. The Attorney General may call upon other agencies of the Government for statistical data, reports, and other information which will assist the Council in the performance of its duties.

(c) Appointed members of the Council shall be paid compensation at the rate of $50 per diem when engaged in the work of the Council, including travel time, and shall be allowed travel expenses and per diem in lieu of subsistence as authorized by law (5 U.S.C. 73b-2) for persons in the Government service employed intermittently and receiving compensation on a per diem, when actually employed, basis.

(d) Any member of the Council is hereby exempted, with respect to such appointment, from the operation of sections 281, 283, and 1914, Title 18, United States Code, and section 190 of the Revised Statutes (5 U.S.C. 99), except as otherwise specified in paragraph (2) of this subsection.

(2) The exemption granted by paragraph (1) of this subsection shall not extend

(A) to the receipt or payment of salary in connection with the appointee's Government service from any source other than the private employer of the appointee at the time of his appointment, or

(B) during the period of such appointment, to the prosecution or participation in the prosecution, by any persons so appointed, of any claim against the Government involving any matter with which such person, during such period, is or was directly connected by reason of such appointment.

SEC. 7. The text of section 605 of the Communications Act of 1934 (48 Stat. 1103, 47 U.S.C. 605) is amended to read as follows:

"No person receiving, or assisting in receiving, or transmitting, or assisting in transmitting, any interstate or foreign communication by wire or radio shall divulge or publish the existence, contents, substance, purport, effect, or meaning thereof, except through authorized channels of transmission or reception, to any person other than the addressee, his agent, or attorney, or to a person employed or authorized to forward such communication to its destination, or to proper accounting or distributing officers of the various communicating centers over which the communication may be passed, or to the master of a ship under whom he is serving, or in response to a subpoena issued by a court of competent jurisdiction, or on demand of other lawful authority; and no person not being authorized by the sender shall intercept any radio communication and divulge or publish the existence, contents, substance, purport, effect, or meaning of such intercepted communication to any person; and no person not being entitled thereto shall receive or assist in receiv

use the same or any information therein contained for his own benefit or for the benefit of another not entitled thereto; and no person having received any intercepted radio communication or having become acquainted with the contents, substance, purport, effect, or meaning of the same or any part thereof, knowing that such information was so obtained, shall divulge or publish the existence, contents, substance, purport, effect, or meaning of the same or any part thereof, or use the same or any information therein contained for his own benefit or for the benefit of another not entitled thereto: Provided, That this section shall not apply to the receiving, divulging, publishing, or utilizing the contents of any radio communication broadcast, or transmitted by amateurs or others for the use of the general public, or relating to ships in distress."

SEPARABILITY

SEC. 8. If any provision of this Act or the application thereof to any person or circumstance is held invalid, the other provisions of this Act and the application of any provision to other persons or circumstances shall not be affected thereby.

TERMINATION

SEC. 9. Upon the expiration of eight years following the enactment of this Act, the foregoing provisions of the Act other than section 5 shall terminate and thereafter shall have no force or effect.

At the level of national policy, if not of local practice, the dominant approach to organized crime is through indictment and conviction, not through regulation, accommodation, or the restructuring of markets and business conditions. This is in striking contrast to the enforcement of antitrust or food-and-drug laws, or the regulation of industries affecting the public interest. For some decades, antitrust problems have received the sustained professional attention of economists concerned. with the structure of markets, the organization of business enterprise, and the incentives toward collusion or price

THOMAS C. SCHELLING

B.A., University of California, 1943; Ph. D., Harvard University, 1951

Presently, Dr. Schelling is a Professor of Economics and a faculty member of the Center for International Affairs at Harvard University. Prior to joining the Harvard faculty in 1958, Professor Schelling was with the Department of Economics at Yale University for 5 years. Professor Schelling served from 1948 to 1953 with the Economic Cooperation Administration Mission in Denmark, the Office of the ECA Special Representative in Paris, the Special Assistant to the President for Foreign Affairs, the Office of the Director for Mutual Security, and the Foreign Operations Administration.

Professor Schelling has been a regular lecturer on military policy at several war colleges and the Foreign Service Institute. Also, he has been a consultant to the Departments of State and Defense, the Arms Control and Disarmament Agency, the RAND Corporation (he took a leave from Harvard during 1958–59 to serve with RAND), the Institute for Defense Analyses, and other organizations concerned with national security. He is a member of the Defense Science Board, Department of Defense, and a member of the advisory panel for the Bureau of European Affairs Department of State. During 1960-63, he served as a member of the Scientific Advisory Board of the U.S. Air Force. During 1961-64, he was a member of the Research Advisory Board of the Committee for Economic Development. He has been the author of many articles on economy. His most recent book, "Arms and Influence," was published by Yale University Press in May 1966.

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cutting. Racketeering and the provision of illegal goods (like gambling) have been conspicuously neglected by economists. There exists, for example, no analysis of the liquor industry under prohibition that begins to compare with the best available studies of the aluminum or steel industries, air transport, milk distribution, or public utility pricing.

Evidence of the lack of professional attention to the economy of the underworld is the absence of reliable data even on the magnitudes involved, of techniques for estimating them even of a conceptual scheme for distinguishing profits, income, turnover, transfers, waste, destruction, and the distribution of gains and losses due to crime. Yet a good many economic and business principles that operate in the "upperworld" must, with suitable modification for change in environment, operate in the underworld as well, just as a good many economic principles that operate in an advanced competitive economy operate as well in a Socialist or a primitive economy. They operate differently, though, and one has to look carefully to see them.

In addition to sheer curiosity there are good policy reasons for encouraging a more professional, "strategic" analysis of the criminal underworld, an analysis that would draw heavily on modern economics and business administration. Such an analysis, in contrast to "tactical" intelligence aimed at the apprehension of individual criminals, could help in identifying the incentives and the limitations that apply to organized crime, in evaluating the different kinds of costs and losses due to crime, in restructuring laws and programs to minimize the costs, wastes, and injustices that crime entails, and in restructuring the business environment in which organized crime occurs with a view to reducing crime or, at least, its worst consequences.

A number of questions need to be pursued. Many are professionally challenging and ought to appeal to economists and others whose talents and energies could be enlisted in the unending campaign waged by the authorities. concerned with law enforcement. As an example, what

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