Needless to say, the sometimes overlapping jurisdictions and competing goals of these two agencies, one leaning toward limiting export of military technology, the other inclined toward stimulating export commerce, had the potential to squeeze business executives earnestly trying to accommodate both goals and appease both agencies.
The defendants shipped the HIP control panel without seeking or receiving an export license. While neither HIP apparatus was itself the issue, prosecutors contended that the control panel could not be shipped without the defendants’ seeking an export license from Commerce, because that panel could operate the larger, as well as the smaller, HIP.
The determinative issue in the criminal case was whether the control panel was specially designed for a HIP of over five inches in diameter (which itself would have required an export license). The disagreement centered on the control panel that could operate both the larger and the smaller HIP and on the operative definition of the critical term “specially designed.” Commerce claimed that the control panel shipped by the defendants from the U.S. was in effect part of the larger HIP and hence was subject to Commerce’s export control regulations requiring an export license.
The indictment stunned Lachman and Subilia. After decades of experience in the defense industry, they thought they had a relatively firm grasp of Commerce’s arcane regulations. They believed, with good reason, that the transaction was entirely legal. Giving the case an even deeper aura of unreality was the fact that the control panel that caused the whole imbroglio was a non-computerized, non-automated, off-the-shelf piece of equipment that could readily be obtained from multiple sources. Rarely, it seemed, had so much legal fuss been made over so little. Lachman, in particular, was incensed and offended. He was a devout American patriot. He took great offense at the implication that he would conduct business that would jeopardize the nation’s security. The eventual recipient of the transaction was, after all, the Indian government—then and now the world’s largest democracy and, despite its then-membership in the “non-aligned nations” camp, fundamentally an American ally. Some unscrupulous exporters will sell military equipment to the highest bidder and then wash their hands, but Walter Lachman was not one of them. Like many in his line of work, he viewed his profession as a noble cause. Now he found himself, his colleague, and his two companies charged with violations of export regulations supposedly fashioned to protect the nation’s security. In 1995, the jury convicted.
Seeking to clear their names, Lachman and Subilia enlisted the counsel of attorney and Harvard Law School legal scholar Alan Dershowitz. I became involved through Dershowitz, as did three of my colleagues: Andrew Good and Philip Cormier of the Silverglate & Good firm, and Michael Schneider, former research assistant to Dershowitz and later a founding partner of the boutique criminal law firm of Salsberg & Schneider. While reviewing the charges against the various defendants and the trial transcript, the defense team discovered the troubling ambiguity in the Commerce provisions under which prosecutors charged and convicted Lachman and Subilia. The wording of the Commerce regulation left unanswered the critical question of whether it covered items that had dual uses and hence were not “specially designed” for military uses.
During the trial, long before we got involved in the case, Judge Woodlock had instructed jurors to follow the “plain meaning” definition of the term “specially designed.” Woodlock observed that any apparatus built “so that it could have an end use in connection with ballistic missile components having a nuclear capability” would be considered “specially designed.” This meant that even if the equipment had a dual use, it would nonetheless be considered “specially designed” for the military use and hence would be covered by the export control regulations. Using these definitions, the jury had convicted, since there was no question that the control panel was capable of dual uses. Indeed, the dual use capability of the panel was precisely the reason Lachman and Subilia did not seek an export license.
Just before sentencing, in August 2003, Lachman and Subilia’s new defense team found and presented evidence that in other instances the Commerce Department itself, during the same period, often interpreted the “specially designed” language so as to exclude dual use items from the licensing requirement. We found statements made by the U.S. delegation at meetings with allied nations seeking to cooperate in controlling the export of strategic defense components, statements made by Commerce officials at educational seminars that were open to the public, and internal understandings among Commerce officials.
It was the evidence in the first category, official positions taken by the U.S. delegation to the Coordinating Committee on Multilateral Export Controls (“COCOM”), that was in many ways the most disturbing. It turned out that the U.S. delegation to COCOM conveyed to the nation’s allies the American position on the meaning of “specially designed” as “equipment used solely for a particular purpose,” thereby excluding dual use items from the export controls.12 There was a reason, however, why Lachman’s and Subilia’s trial lawyers had no idea that the government had earlier asserted, as official American policy, a definition precisely the opposite of the incriminating one that it successfully urged upon Judge Woodlock and the jury at the trial: the COCOM proceedings were classified and hence not available to trial counsel.
The new defense team learned of this sleight-of-hand by happenstance, aided by some dogged investigative follow-through. The American position taken at COCOM, which would have ended the trial even before it began had it been made known to the court, was declassified in Germany, one of the participating COCOM nations, when it was used in a public trial in Darmstadt. Almost comically, the Justice Department insisted that it could not produce in Judge Woodlock’s open court the original American version of this document because it remained classified in the United States, notwithstanding Germany’s declassification and use in court in Germany of the translated version. The American document, therefore, had to be used in the Lachman/ Subilia post-conviction litigation on a classified basis.
The evidence of the position taken by government officials at industry seminars was almost as startling. Witnesses discovered by the new legal team revealed that Commerce Department officials, appearing at public educational seminars frequented by members of industry, taught that a “product or component is only specially designed for a certain product or purpose if it can only be used for that product or purpose.”13 The former Commerce officials who brought this revelation to the attention of the court told the judge that this “was the only meaning of the term ‘specially designed’ that was consistently used within” the Commerce Department.
The prosecutors were hardly pleased when confronted with the overwhelming evidence showing Commerce’s double standards in export regulation. They tried to argue that the information contained in the classified COCOM minutes was “simply in error,” and that the Commerce officials who spoke at public educational seminars were “not authorized to supply official definitions for terms.” But Judge Woodlock would have none of it. He concluded that “there was no determinable definition for the term ‘specially designed’…upon which a criminal proceeding could be mounted,” and sided with Commerce’s Inspector General who by then acknowledged the term to be ambiguous.
Judge Woodlock quoted a former Chief Justice of the United States, Morrison Waite, who wrote in 1876 that “it would certainly be dangerous if the legislature could set a net large enough to catch all possible offenders, and leave it to the courts to step inside and say who could rightfully be detained; and who should be set at large.”14 He concluded that Lachman and Subilia had not been given fair notice of what the law required, and tossed out the guilty verdict.
One of the opinions Woodlock cited as precedent for his decision was that of the Court of Appeals for the First Circuit in United States v. Anzalone,15 the ultimately unsuccessful prosecution of the aide to then-Boston Mayor Kevin H. White, where the court had observed that “the present ambiguity regarding coverage of th
e [cash transactions statute and regulations] has been created by the government itself.” Were Lachman and Subilia to appeal, after all, it would be that very court that would decide the case, and presumably it would feel bound by its earlier Anzalone opinion (discussed in Chapter One). Woodlock went on to quote yet another precedent, Lewis Carroll’s classic Through the Looking Glass:“When I use a word,” Humpty Dumpty said in a rather scornful tone, “it means just what I choose it to mean—neither more nor less.”
“The question is,” said Alice, “whether you can make words mean so many different things.”
“The question is,” said Humpty Dumpty, “which is to be master—that’s all.”16
The Department of Justice was not done with Lachman and Subilia, however. Because the acquittal had been entered by the trial judge after a conviction by the jury, the government had a right to appeal. And so the case went to the same appellate court that had tossed out Theodore Anzalone’s money laundering conviction in 1985 on grounds that it had been based on regulatory language that was too ambiguous. But the times, as well as some members on the Court of Appeals for the First Circuit, had changed.
The Court of Appeals issued its decision on October 25, 2004, 11 years after Lachman and Subilia were indicted. It reversed Judge Woodlock. “We hold,” wrote the court, “that the applicable…regulation was not unconstitutionally vague.” After admitting that dictionary definitions did not resolve the question, the First Circuit panel directed its attention to what it viewed as the purpose of the regulations. The regulatory scheme, the court concluded, “was designed to ensure that exports do not detrimentally affect the national security of the United States, while not unduly restricting legitimate trade.” The government’s definition is more in keeping with this goal, concluded the Court of Appeals, notwithstanding the evidence that Commerce itself had secretly interpreted the regulatory scheme (and had informally advised the industry) in a manner that matched Lachman and Subilia’s understanding and that Judge Woodlock finally adopted.
“We have concluded that the regulation is not ambiguous when construed in light of the statutory purpose,” wrote the Court of Appeals. It deemed the classified material demonstrating the government’s secret interpretation of the language to be irrelevant precisely because it was secret! It dismissed the Commerce members’ public statements at industry seminars to be irrelevant because they were not “official.” The regulation, the Court of Appeals concluded, “was reasonably susceptible to the construction that we have adopted” and hence “there is no basis for invalidating [the regulation] as failing to provide fair notice.” It did not seem to matter that Lachman’s and Subilia’s interpretation was no less reasonable than that of the government, and was in fact more in keeping with Commerce’s own long-held and often-expressed views. All that mattered was that the interpretation now being proffered by the government seemed more in keeping with America’s security interests as now understood by the Departments of Commerce and Justice—all this without Commerce’s being required to clarify the regulation, as it easily could have done, to cover “dual uses.”
The Court of Appeals thus answered the question posed by Judge Woodlock and Humpty Dumpty: the government was to be master, and that ended the case. More than a decade after his indictment, Walter Lachman was sentenced to three years probation, the first of which was to be spent under house arrest. Maurice Subilia was sentenced to six months home confinement, probation, and a $250,000 fine. The government, dissatisfied with the sentences, appealed them. In October 2004, while the defendants’ guilt was sealed, the defendants’ long nightmare still was not quite over. The case finally ended in January 2008, after the government withdrew its appeal as a result of an intervening, unrelated Supreme Court decision upholding the kind of sentencing discretion exercised by Judge Woodlock.
The sentencing hearing yielded little insight into why the government brought the prosecution in the first place. For one thing, it was learned that there was no evidence whatsoever that the “carbon-carbon” technology embodied in the HIP devices was at all useful to India’s atomic weapons program. The technology was relevant only in long-range intercontinental ballistic missiles, whereas the Indian program dealt in shorter-range delivery systems aimed at neighboring Pakistan and China. A government technical witness conceded that the HIP control panel that was at the heart of the prosecution was actually a very simple device (unlike the HIPs themselves which had been shipped lawfully) and could be made by any reasonably competent engineer. There was absolutely no national security-related reason to stretch the regulations to cover the shipment of such an easily manufactured, off-the-shelf, add-on device.
In finding the Commerce regulation “not ambiguous,” the Court of Appeals had found clarity in language that an ordinary person of reasonable intelligence could not help but see as ambiguous. In that regard, the Court of Appeals was playing the King in another Lewis Carroll classic, Alice’s Adventures in Wonderland. Alice cannot make sense of the White Rabbit’s nonsensical charges, stated in rhyming verse, against the Knave, on trial for stealing the Queen of Heart’s tarts:“If any one of them can explain it,” said Alice.… “I’ll give him sixpence. I don’t believe there’s an atom of meaning in it.”
The jury all wrote down on their slates, “She doesn’t believe there’s an atom of meaning in it,” but none of them attempted to explain the paper.
“If there’s no meaning in it,” said the King, “that saves a world of trouble, you know, as we needn’t try to find any. And yet I don’t know,” he went on, spreading out the verses on his knee, and looking at them with one eye: “I seem to see some meaning in them, after all.”17
Given the liberties prosecutors and federal judges took with statutory interpretation during the Cold War, it stood to reason that in the wake of the terrorist attacks of September 11, the “Silly Putty®” approach would become even more deeply entrenched.
The feds launched one of the first such prosecutions against Steven Kurtz, member of the cutting edge, internationally known Critical Art Ensemble (CAE) and also art professor at the State University of New York at Buffalo (SUNY/Buffalo). Kurtz woke up on May 11, 2004, to find his wife Hope lying, apparently dead, in bed. He dialed 911 and paramedics soon arrived. One of them noted the presence of laboratory equipment in the house, including Petri dishes with live microorganisms. He notified the local police, who showed up to investigate. Kurtz, with his wife’s body in the next room, demonstrated to the police the harmlessness of these biological specimens, explaining how he incorporated them into various pieces of his art. He even inserted his finger into the bright scarlet bacteria in one of the Petri dishes and put it in his mouth.18
It was all for naught. The police shortly notified the FBI. The next day, as he returned home from his late wife’s funeral, Kurtz was confronted by three carloads of FBI agents and others dressed in hazardous materials suits. A full-scale bioterrorism scare was in progress, conducted cooperatively by five regional offices of the FBI, the Joint Terrorism Task Force, the Department of Homeland Security, the Department of Defense, the Buffalo police and fire departments, and the New York State Fire Marshall’s office.19 Kurtz and one of his colleagues, University of Pittsburgh genetics professor Dr. Robert Ferrell, had become the subject of a nationwide federal criminal terrorism investigation.
Much controversy ensued in the local and national press, and on Websites and blogs, as to whether the authorities had overreacted, especially once they discovered that the bacteria in Kurtz’s Petri dishes were harmless organisms of the type found in profusion, for example, in the human gut. Kurtz had been using the bacteria, it turned out, in connection with a CAE project named “Gen Terra,” which, according to a New York Times description, “looked at genetic engineering of organisms from the perspective of a fictional corporation.”20 Members of CAE employ somewhat more grandiose terms for the project, which they claim is “dedicated to exploring the intersections between art, technology, radical politics and
critical theory.”
Federal investigators, led by William J. Hochul, Jr., the lead terrorism prosecutor in the Buffalo U.S. attorney’s office, interrogated other members of CAE and even looked into museums and other institutions that possessed artworks created by Kurtz. CNN reported, for example, the seizure of one Kurtz exhibit that “would allow gallery-goers to test for common genetic modifications in food.”21 The geographic reach of the investigation was determined largely by the success and renown of Kurtz’s artwork, which, the CAE explained on its Website for raising a defense fund, “had been displayed in museums and galleries throughout Europe and North America.”22
When the investigation was over, it was apparent that there was no prosecutable violation of the post-9/11 federal anti-terror statute under which the feds had been proceeding. Section 175 of the U.S. Biological Weapons Anti-Terrorism Act of 1989, enlarged in scope by Section 817 of the USA Patriot Act passed in the wake of the September 11 attacks,23 outlaws the possession of “any biological agent, toxin, or delivery system of a type or in a quantity that, under the circumstances, is not reasonably justified by a prophylactic, protective, bona fide research, or other peaceful purpose.”24 Even the most creative stretching of this statute would not cover artworks made of common and harmless bacteria, clearly for a “peaceful purpose.”
However, federal “catch-all” criminal statutes are always available to serve investigators’ and prosecutors’ agendas even when a particular activity does not fit within a more specific statute. Buffalo’s Kurtz and his Pittsburgh colleague Ferrell soon found themselves named in a four-count indictment, two counts for mail fraud and two for wire fraud.25 Because, the indictment alleged, the defendants used the instrumentalities of interstate commerce (a commercial interstate carrier for the mail fraud counts, and electronic computer communications for the wire fraud count) they were each subject to up to 20 years in prison (five years on each count).
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