By: Danielle McClellan
If you haven’t read our August 2009 article about Del Monte suing OFAC for “unreasonably delaying” their license approval, you really should after this article. It seems as though the courts are beginning to favor exporters over the complicated and time ensuing government regulators. Although the Del Monte case is in its very early stages and may not even amount to a victory for the aggravated exporter, this case however, has been finalized and the exporter won… well maybe not won, but won’t be going to jail or paying any huge penalty fines for violating the ITAR.
Doli Syarief Pulungan was convicted of trying to smuggle assault rifle scopes from the US to Indonesia. Pulungan apparently tried to get an “unnamed” friend and “unnamed” police chief in Wisconsin to buy 100 scopes for him; these scopes are designed to be used on M-16 and AR-15 assault rifles for close-quarters combat. There is no doubt that Pulungan was guilty of smuggling these scopes, in May 2008 he was convicted of violating the ITAR, specifically exporting/attempting defense articles without a license. Pulungan immediately appealed the case on grounds that the prosecutors never actually proved that the scopes in question were defense articles and governed by the ITAR.
Now this is where the case gets interesting and exporters worldwide may want to take note. The 7th Circuit U.S. Court of Appeals in Chicago overturned Pulungan’s guilty conviction on grounds that the ITAR regulations “were so vague, the defendant could not be held responsible for violating such vague regulations.” The appeals court went on to explain that, “the government failed to properly identify which specific items were subject to export control regulations, or to justify criteria for controlling them.” Apparently the vague, catch-all controls of the ITAR may have finally caught up with DDTC, the court stated that the State Department’s claim of “authority to classify any item as a “defense article,” without revealing the basis of the decision and without allowing any inquiry by the jury, would create serious constitutional problems.”
The appeals court wanted to make a point, and they did. They upheld that in regular circumstances a regulation is published for all the public to see so that people have an opportunity “to adjust their conduct to avoid liability.” But, “a designation by an unnamed official, using unspecified criteria, put in a desk of a drawer, and taken out only for use at a criminal trial, and immune from any evaluation by the judiciary, is the sort of tactic usually associated with totalitarian regimes.” This being said, many outside observers are suggesting this ruling may have an effect on export controls and violations, especially those surrounding the ambiguity of the ITAR which often gives the State Department tremendous leeway in determining what is or is not a “defense article.”