International Trade Law News

Published by Jacobson Burton Kelley PLLC

Here is the latest update on the criminal export controls case involving Professor John Reece Roth and his alleged co-conspirators.

Dr. Roth Released on Bond Pending Appeal

Following Professor Roth's sentencing to 48 months in prison for violating the Arms Export Control Act (AECA) and being found guilty of one count of wire fraud, Professor Roth's defense counsel filed a Motion for Release Pending Appeal. On July 28, 2009, U.S. District Judge Thomas Varlan granted Professor Roth's motion and he will remain released on bond pending the outcome of the appeal to the Sixth Circuit Court of Appeals.

During the hearing on the motion, the U.S. Attorney's office conceded that Professor Roth is not likely to flee if released, he did not pose a risk to the community and did not contend that the appeal was for the purpose of delay. As a result, under the Bail Reform Act of 1984 the remaining question for Judge Varlan to consider was whether the appeal raises a substantial question of law or fact likely to likely to result in reversal, a new trial, a sentence that does not include a term of imprisonment, or a reduced sentence to a term of imprisonment less than the total of the time already served plus the expected duration of the appeal process.

In Professor Roth's motion, the defense argues that this appeal raised four substantial questions of law or fact, including:

1. Whether the items covered by the Indictment were defense services or technical data directly related to a defense article as those terms are defined in the United States Munitions List (“USML”);
   
2. Whether or not there was sufficient evidence to prove that the defendant willfully violated the AECA;
   
3. Whether the Court erred in refusing to instruct the jury on ignorance of the law as the defendant requested; and
   
4. Whether the Court was in error in denying the defendant’s motion to strike references in the Indictment to the national security interest of the United States.
   

Judge Varlan only addressed the second issue. After reviewing the various case law Judge Varlan found that that "there is a substantial question regarding the definition of willfully applicable to the AECA and the related issue of the extent to which ignorance of the law is a defense because there is a circuit split and the Sixth Circuit has not decided the substantial question of law." Specifically, Judge Varlan indicated that he reviewed the "available case law and determines that the level of knowledge defendant must have regarding the illegality of his action is an undecided issue and that there is not a clear trend such that the question could not be answered either way."*

As a result, Judge Varlan granted Roth's motion for release pending appeal since there is a substantial question of law that if resolved in Roth's favor would lead to a new trial and/or a reduction in Roth's sentence.

Dr. Roth's Release Order can be found here. Thanks to a loyal reader for providing this document to International Trade Law News.

Sentencing of Sherman and Atmospheric Glow Technologies

Two additional defendants in the case involving Dr. Roth have pleaded guilty and are awaiting sentencing.

Daniel Daniel Max Sherman, a physicist who was trained by Dr. Roth and was an employee, director and one of the original founders of Atmospheric Glow Technologies, Inc. , pleaded guilty to one count of conspiracy to violate the Arms Export Control Act. Sherman, who has been free on bond, will be sentenced on August 10th.

Atmospheric Glow Technologies, Inc. (AGT) will be sentenced by Judge Varlan on August 27th. AGT pleaded guilty in August 2008 to 10 counts of unlawfully exporting defense articles to a citizen of the People’s Republic of China in violation of the Arms Export Control Act. AGT, which for bankruptcy in 2008, was a plasma technology company located in Knoxville, Tennessee.

Thanks to another loyal reader for providing the updated information on the Sherman and Atmospheric Glow sentencing dates.

*Interestingly, in his review of the applicable case law Judge Varlan did not mention the recent Seventh Circuit decision in United States v. Pulungan, in which the court reversed the conviction on grounds that the evidence presented at trial was insufficient to show that the defendant knew that certain rifle scopes were "defense articles" that required export licenses since the rifle scopes were not included on the U.S. Munitions List and the Commodity Jurisdiction obtained by the manufacturer was not known to the defendant or the public.

Labels: Export Controls