A jury will resume deliberations today in the trial of two men facing federal industrial espionage charges for allegedly taking photographs of tire-making machinery at a Goodyear Tire and Rubber Co. plant in Kansas in order to duplicate the equipment.
Federal prosecutors and defense lawyers presented closing arguments Wednesday in the case of Clark Alan Roberts and Sean Edward Howley, then U.S. District Judge Thomas W. Phillips sent the case Wednesday afternoon to the jury of eight men and four women for deliberations, which ended the day without a verdict.
Phillips ordered jurors to resume deliberations at 9 a.m. today.
Roberts and Howley are standing trial on a 10-count indictment alleging that they conspired to steal and make use of trade secrets. In closing arguments, prosecutors portrayed the case as one of blatant theft of information from Goodyear to help a competing Chinese tire company gain an economic advantage. Defense attorneys said it was really more of a civil case that didn’t belong in federal criminal court.
“It was a bad business decision to take those photos,” said Tom Dillard, attorney for Roberts. “But that doesn’t make it a federal offense.”
Thomas Dougherty, an attorney for the U.S. Justice Department, disagreed.
“The defense may not like it, but it is a federal crime to steal trade secrets,” Dougherty said. “It is not just a bad business decision; it is a theft.”
Dougherty and Greg Weddle, assistant U.S. attorney, contend that Roberts, who was head engineer for Greenback-based Wyko Tire Technology Inc., and Howley, an engineer in training there, arranged a visit to a Goodyear plant in Topeka May 30-31, 2007, so Howley could use his cellphone camera to take seven photos of an over-ply down machine used for a crucial phase of producing large tires used on mining and earth-moving equipment.
Wyko had a contract with a Chinese tire manufacturer to provide such a machine, and Wyko was having trouble producing one within the 20 weeks stipulated in the contract, prosecutors said.
Defense attorneys do not deny the men took the photographs but challenged the idea that the over-ply down machine met the legal definition of a trade secret. In the 1990s, Goodyear had sent an example of the machine to Wyko, a Goodyear supplier, for possible modification and improvement and Wyko kept the machine for three years, the attorneys said.
“You can’t steal that machine if you already have it,” said Doug Trant, Howley’s attorney.
In 2000, Goodyear sent Roberts detailed photographs of the over-ply down machine, Dillard said. Defense attorneys said neither the machine nor the photos came with any confidentiality agreement, but prosecutors said there was fine-print language in the purchase orders sent with those items that restricted their use.
Earlier in the trial, which began Dec. 1, Trant suggested that Goodyear was using the federal government to do its dirty work.
“If Goodyear needs to sue him, they ought to sue him,” Trant said.
Both sides agreed that Goodyear was warned by a Wyko employee that Roberts and Howling were planning a trip to Topeka to photograph sensitive equipment there. Prosecutors counted this as evidence of the defendants’ plan to steal trade secrets. Defense attorneys questioned why Goodyear didn’t try to stop them after being tipped off.
Roberts and Howley are being tried under the Economic Espionage Act of 1996, which Congress enacted out of concerns that foreign countries try to steal U.S. trade secrets, the ease with which technology makes it possible for disgruntled employees to steal a company’s privileged information and other factors.
The act sets out guidelines to define a trade secret, and one of the crucial tasks of the jury will be to see if the over-ply down machine meets them. Something is a trade secret under the act if the owner took reasonable measures to ensure secrecy, the protected information would not be generally known or readily accessible to the public, and if the owner would derive some “independent economic value” from keeping the information secret.
Business writer Ed Marcum may be reached at 865-342-6267.
A couple cannot agree what color to paint the kitchen. Two cubicle-mates are arguing over a radio station. A teenager wants a later curfew, but mom and dad say no.
Neither side wants to give in. What now?
Two local entrepreneurs have the answer: let the court of popular opinion make the call.
Kevin Wielgus of Carol Stream and Angelo Rago of DesPlaines, both 36, are the co-founders of JabberJury, an online community that allows users to air and settle conflicts using a jury of their peers and the world at large.
Unlike real court proceedings, JabberJury’s resolution process is designed to be fun.
“It’s human nature to eavesdrop on the couple arguing one table over at a restaurant,” Rago said. “Every good story has a hero, a villain and a conflict. And we all have an opinion.”
Parties who want to strengthen their case can invite witnesses and submit evidence, just like in a real trial. JabberJurors can use all this support to better decide who they think is right or wrong.
Users who post a case and win or vote for a side and win or even invite friends to become JabberJurors can earn Jabbies, a virtual online currency, which can be redeemed for prizes.
Participants also can choose to donate their winnings to various charities.
Wielgus and Rago came up with the idea for JabberJury one night after Rago had an argument with his former girlfriend, which Wielgus and his wife witnessed.
Rago’s girlfriend began sending him numerous text messages, criticizing his behavior.
Rago was frustrated, figuring she was telling her friends about the situation and they were unfairly passing judgment on him.
“Angelo said, ‘I bet if we ask everybody in this bar they’d agree I’m right if they heard both sides of the story,’” Wielgus recalls. “He said, ‘There has to be a way to ask everybody.’”
Both Wielgus and Rago, friends since 2002, realized with the rise of social media there was a way.
“It went on from there,” Wielgus said. “Angelo and I talked more in the next two weeks than we did in the last two years.”
The duo hope the site will be fully up and running in the next few weeks.
“Hopefully in time for all of your Christmas arguments,” Wielgus said.
Sen. Dianne Feinstein wants to prosecute Julian Assange for espionage.
The founder of WikiLeaks “intentionally harmed the U.S. government,” says Feinstein, who chairs the Senate Intelligence Committee. By releasing 250,000 State Department cables, he also violated the 1917 Espionage Act by transmitting “information which the possessor has reason to believe could be used to the injury of the United States or to the advantage of any foreign nation,” Feinstein, D-Calif., charged in a Wall Street Journal opinion piece Tuesday.
To John Perry Barlow, co-founder of San Francisco’s Electronic Frontier Foundation, “The first serious infowar is now engaged. The field of battle is WikiLeaks.” The Mill Valley resident (according to his Facebook profile) tweeted to followers: “You are the troops.”
If there’s any doubt which side Barlow is on, he helpfully provides a list of “mirror” sites that carry the material originally posted on the disabled WikiLeaks official site. “Let a thousand mirrors shine,” Barlow tweeted.
On the other hand, Larry Sanger, co-founder of San Francisco’s Wikipedia (no relation), says Assange is “an international outlaw,” and believes the New York Times and other papers that have taken feeds from WikiLeaks have “done something that could be really damaging to the United States.”
And so it goes.
Setting aside the debate on rights and wrongs, there is one thing of which we can be reasonably certain. Given what Rodric Braithwaite, a former British ambassador in Moscow, calls “the inherent openness of modern technology,” it’s difficult to see how the wave WikiLeaks represents can be stopped.
Indeed, the next tranche, Assange has promised, will hit U.S. corporations, beginning with a major bank. To follow: more from the financial industry, plus the energy and pharmaceutical sectors, he told Forbes.com this month. Based on his record, Assange probably isn’t just blowing smoke.
I’m not in a position to pontificate on the damage the leaks have supposedly done to U.S. foreign relations or to the practice of diplomacy as we know it. Nor, for example, whether information, contained in the cables, detailing potential terrorist targets around the world, endangers our war with al Qaeda. But I’m sure I’ve read about the Chinese government hacking into Google before.
Defense Secretary Robert Gates has called the current batch “embarrassing” and “awkward,” but not a “game changer.” The diplomatic fallout, he believes, will be “fairly modest.”
However, Gates was considerably angrier about earlier releases on the Iraq and Afghan wars, and with good reason. As noted by Harold Evans, former editor of the Times of London, “reckless disclosures” contained in 76,000 military documents about Afghanistan “identified dozens of Afghans credited with providing intelligence to the U.S. and thereby exposed them to a Taliban beheading.”
Evans was probably referring to a recent London Times report, which found WikiLeaks had not only identified individuals, but also their villages and their fathers’ names.
An example from the current release relates to a Los Angeles dentist, Hossein Vahedi, whose daring escape on horseback from Iran was recounted in one of the released cables. Vahedi, 75, lost his passport while visiting his parents’ graves and some family members in Iran in 2008.
“To protect his family and friends from retribution by the (government of Iran) after his absence was noted, he spoke to none of them of his escape plans,” the cable from the U.S. Mission in Turkey stated.
Well, now the government of Iran knows. “This is very bad for my family,” Vahedi told the New York Daily News when he learned the cable had been leaked. “How could this be printed?”
In addition to Assange and his enablers, the question might also be asked of others, including U.S. Army Pfc. Bradley Manning, now in solitary confinement at a military base in Quantico, Va.
Manning, 23, a reportedly unhappy low-level intelligence analyst in Iraq, has admitted packaging on rewriteable CDs and sending along to WikiLeaks more than 350,000 classified documents to which he had access on Pentagon-run computer systems.
“If you had unprecedented access to classified networks 14 hours a day, 7 days a week, for 8-plus months, what would you do?” Manning said in an instant message to a U.S. computer hacker.
Braithwaite called Manning’s alleged feat “an embarrassing technical failure” on the part of the Pentagon. “It is the job of governments to keep their secrets secret,” he wrote in the Financial Times.
The hacker, Adrian Lamo, who had done time for breaking into a New York Times computer, turned Manning in to the authorities as “an act of conscience.”
Blogging at sfgate.com/columns/bottomline. Facebook page at sfg.ly/doACKM. Tweeting @andrewsross. E-mail bottomline [at] sfchronicle [dot] com.
This article appeared on page D – 1 of the San Francisco Chronicle
The son of one of the highest-ranking CIA officers to betray his country dodged a prison sentence Tuesday after making a deal with prosecutors to help build their case against his father.
Nathan Nicholson apologized in court for his role in a scheme to get his father’s Russian handlers to pay the man he once idolized: Harold “Jim” Nicholson, who is serving 24 years at a federal prison in Oregon for his 1997 espionage conviction.
U.S. District Judge Anna Brown sentenced Nathan Nicholson to 5 years on probation and 100 hours of community service after agreeing with a joint recommendation by prosecutors and defense attorneys who said he was manipulated and groomed by his father.
“Once this defendant was confronted, he did not hesitate to accept responsibility,” Brown said in court.
Nathan Nicholson had already pleaded guilty to acting as an agent of a foreign government at his father’s bidding and conspiracy to commit money laundering, and Brown said his actions will remain with him for the rest of his life.
‘I want to be my own man’
The 26-year-old told The Associated Press and The Oregonian newspaper that he had idolized his father, but “after this, I want to be my own man now. I don’t want to live in someone’s shadow.”
In a case that unfolded like a fictional thriller, from 2006 to 2008 the 26-year-old former Army paratrooper traveled the world at his father’s bidding to meet with Russian agents — in San Francisco, Mexico City, Peru and Cyprus — to collect payments the father believed were long overdue.
His father trained Nathan in CIA tradecraft, advising him to hide money from the Russians in different places, to never deposit more than $500 in his bank account, and to pay for trips in cash to avoid a paper trail.
It began in the summer of 2006 when the incarcerated Harold Nicholson asked his son to help him contact the Russian government for “financial assistance,” a sort of pension for his past work. Nathan Nicholson, then 22, was a student at Lane Community College.
The younger Nicholson was excited about the prospect of doing clandestine work for his father, according to the sentencing memo.
Harold Nicholson told his son to go to the nearest Russian consulate to make initial contact, and over the next two years, the son met with Russian agents six times. Prosecutors say Russian agents agreed to meet with the younger Nicholson because they wanted to learn how the FBI caught his father and to obtain information about the CIA.
Nathan Nicholson was paid a total of about $47,000 by the Russians.
The imprisoned ex-spy encouraged his son by praising his work, saying “he had performed as well as, or better, than some of the CIA employees” he had trained for the agency, according to the sentencing memo.
But as he jetting around to his meetings with them, the FBI was already on to the father and the son. In February 2002, a “concerned citizen” told the FBI that Harold Nicholson may have tried to contact Russian agents through other inmates and an investigation was begun, leading to an indictment in January 2009.
Harold Nicholson pleaded guilty Nov. 8 to the same charges as his son. He faces sentencing Jan. 18.
Dad caught in 1996
Harold Nicholson had risen to CIA station chief before he was arrested in November 1996 at Dulles International Airport in Virginia with 10 rolls of film he had intended to hand over to Russian agents. Federal officials say that before his arrest, he had been trotting around the globe to hand off documents to the Russians and that he was paid for his work.
Nathan Nicholson said he was about 10 when he first learned his father worked for the CIA. At the time, Harold Nicholson was an instructor at a CIA training camp in Williamsburg, Va.
The family had moved around a lot, and Nathan said he rarely saw his father but soaked up his stories about Harold Nicholson’s own military career in the Army.
In their sentencing memo, federal prosecutors said the elder Nicholson had “significant emotional power” over the son, using his skills to “groom and manipulate him” while in prison.
Nathan Nicholson said he now wants to rebuild his life — a “very frugal” existence on VA benefits and financial aid at Oregon State University, where he’s studying computer science.
“I want to restore the honor that was lost,” he said.
Connecticut Sen. Joe Lieberman has been blasting WikiLeaks over the past week and successfully pressured Amazon.com to kick the organization’s content off its servers.
Lieberman kept up the attack on Tuesday. During a Fox News interview, Lieberman claimed that WikiLeaks is responsible for the “most serious violation of the Espionage Act in our history” and should be indicted in a U.S. court. But Lieberman then suggested that news organizations that published leaked material — originally obtained by WikiLeaks — may have also violated the Espionage Act.
“I’m not here to make a final judgment on that,” Lieberman said. “But to me the New York Times has committed at least an act of bad citizenship, but whether they have committed a crime, I think that bears very intensive inquiry by the Justice Department.” You can watch a clip of the Lieberman interview here, via Business Insider.
“We believe that our decision to publish was responsible journalism, legal, and important to a democratic society,” Times spokeswoman Danielle Rhoades Ha told The Cutline, noting that the paper’s editors addressed such issues in their note to readers that accompanied the WikiLeaks stories.
Lieberman and other politicians have been grabbing headlines lately for denouncing WikiLeaks and talking about throwing the site’s editor-in-chief, Julian Assange, in jail. But legal scholars are quick to point out the difficulty in actually shutting down the online organization or successfully trying Assange for espionage.
Lieberman isn’t the only senator talking about espionage. California’s Diane Feinstein similarly argued in the Wall Street Journal on Tuesday that Assange should be tried under the 1917 act.
Salon’s Glenn Greenwald shot back at the Assange critics who are invoking the Espionage Act. Greenwald pointed out that “every line of pro-prosecution rationale cited by Feinstein applies equally to journalists … especially the newspapers from around the world which are publishing all of the same diplomatic cables as WikiLeaks is, and which are publishing them before WikiLeaks even does.”
There’s a common misconception in the coverage on WikiLeaks — that the organization simply dumped 250,000 State Dept. cables online. That’s not the case. WikiLeaks has published less than 1,000 cables, and Greenwald is correct in noting that news organizations actually vetted the cables and published them before WikiLeaks put them online.
For that reason, Greenwald asked, “how can it possibly be that WikiLeaks should be prosecuted for espionage, but not the New York Times, or the Guardian, or any other newspaper that publishes these cables?”
Assange also questioned Tuesday why his organization— rather than news organizations publishing the material — is the one dealing with the “most vicious attacks and accusations from the U.S. government and its acolytes.”
WikiLeaks, a shadowy organization operating primarily overseas, is an easy target for U.S. political leaders. But Lieberman and other senators talking up the Espionage Act may find it much tougher getting support to go after the Times, or any news organization that relies on leaked documents to inform the public.
