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Local hackers plead guilty to PayPal cyberattack


A Santa Rosa man and a Napa woman were among the 13 who have pleaded guilty in federal court in San Jose to charges related to a 2010 cyberattack against the online payment site PayPal.

The attacks were linked to Anonymous, an amorphous international affiliation of hackers and internet protesters.

Drew Alan Phillips, 28, of Santa Rosa, pleaded guilty Thursday to one count of intentional damage to a protected computer, a misdemeanor which carries a maximum penalty of one year in prison and a $100,000 fine, according to a statement released by the Department of Justice. Tracy Ann Valenzuela, 44, of Napa, pleaded guilty to one count of reckless damage to a protected computer, also a misdemeanor that carries a maximum penalty of a year in prison and a $100,000 fine.

The charges stem from a cyberattack the group Anonymous made against PayPal's website in December 2010. The so-called distributed denial of service attack limited PayPal's ability to serve its customers by flooding its system with useless commands.

Anonymous claimed responsibility for the attack, which impacted many major U.S. companies, according to the statement. The group said it struck in retribution for PayPal's suspension of WikiLeak's accounts after WikiLeaks released a large amount of classified State Department documents on its website in November 2010. The organization, which runs mainly off donations, claimed that PayPal, which is run by eBay, "tried to economically strangle WikiLeaks."

Valenzuela's attorney, James McNair Thompson, contended that his client's actions amounted to signing a petition to express her displeasure with Pay-Pal's treatment of WikiLeaks.

He said that Valenzuela essentially clicked a link on a website to register her disapproval. Doing so apparently caused some requests to be sent to PayPal that helped overwhelm the system.

"Clearly she didn't intend to damage the business," he said. "She did not enter this with the idea she was doing civil disobedience and prepared to go to prison. According to her plea, Valenzuela will not have to serve prison time if she does not violate the terms of the agreement, Thompson added.

George Ledin, a Sonoma State University computer science professor who specializes in computer security and malware, said he did not know the specifics of the case but he did not consider the actions against PayPal hacking. He likened what was done to a digital form of protest, like blockading a street or an entrance to a business. While he contended that the actions amounted to a form of protected free speech, he also acknowledged that it was "inevitable" that those involved in the cyberattack would be punished.

Phillips could not be reached by phone Monday afternoon and was not at the northwest Santa Rosa home listed as his residence on voter registration records. A sticker on the door read, "Come back with a warrant." It gave the web address for the Electronic Frontier Foundation, which bills itself as a nonprofit digital rights group.

In a 2011 New York Times article, Phillips acknowledged that he had joined an Anonymous-affiliated chat room and played around with the software used in the Pay-Pal attack. But while he said he was sympathetic to the attack against PayPal, he told the New York Times that he did not actually participate.

Eleven men and two women, five of them from California, were charged in the attacks. Ten of the defendants also pleaded guilty to a felony count of conspiracy, though if they do not violate the terms of their pleas, they can change that count to a misdemeanor.

All the defendants are currently out on bond. Phillips and Valenzuela's sentencing hearings will not take place until next December.

You can reach Staff Writer Jamie Hansen at 521-5205 or jamie.hansen @pressdemocrat.com. On Twitter at @JamieHansen.