Business Frets Over Impact of China Spy Case
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.

SANTA ANA, Calif. — A major Chinese espionage case set to open today is causing concern among attorneys for major defense contractors and exporters, who contend that one of the prosecution’s key legal arguments upsets a long-standing interpretation of export laws and could wreak havoc in industry and elsewhere.
Opening arguments from the prosecution and defense are expected in federal court here this morning in the case of Chi Mak, an engineer accused, along with four of his family members, of conspiring to transfer naval technology to China.
In 2005, the FBI arrested Mr. Mak’s brother and sister-in-law at Los Angeles International Airport as they were about to board a flight to Hong Kong. Prosecutors contend that the couple was headed to meet with a Chinese government contact and had in their carry-on luggage a disk containing encrypted files Mr. Mak obtained about sensitive propulsion systems for submarines and other vessels.
The prosecution argument prompting worry in business circles stems from the government’s decision not to charge Mr. Mak and his counterparts with the theft of classified data but with violations of export control laws. Mr. Mak’s attorneys have asserted that the technologies he allegedly sought to export were all discussed at “publicly attended conferences.” However, the government contends that fact is irrelevant because a “public domain” exception in export law does not apply to countries like China, which was put under an arms embargo following the Tiananmen Square massacre in 1989.
“That is a bonkers interpretation,” an export law attorney in Washington, R. Clif Burns, told The New York Sun yesterday. “This would criminalize all kinds of things not considered by anyone to be criminal.”
Mr. Burns, an attorney with Powell Goldstein LLP and an adjunct professor of law at Georgetown, said eliminating the public domain exception would make it a crime to tell anyone who is a citizen of China, Cuba, Iran, or about 20 other countries basic facts that have an application in the defense field.
“Everyone knows that our fighter planes make a sonic boom when they break the sound barrier, but, if you told a Chinese person that, it would be a crime,” Mr. Burns said skeptically. The attorney said the government’s legal interpretation, if enforced or observed, would throw many technology-oriented courses at universities into disarray. “You would have to exclude Chinese students from that class,” he said.
Mr. Burns said he learned of the government’s position from a colleague who saw it mentioned in a New York Sun article last week on the Mak case. The attorney, who represents exporters, said the prosecution’s stance has met with surprise and dismay by those active in the field. “This will be a bombshell in the export community,” he said.
Mr. Mak’s attorneys have not seriously disputed the government’s contention that there is no public domain exception applicable to Mr. Mak’s case. They did object to the fact that they were not permitted to challenge the State Department’s certification, obtained after Mr. Mak was arrested, that the data he allegedly sought to export were subject to export controls. However, the defense conceded that the 9th Circuit has found no constitutional problem with this sort of post hoc determination.
The export law issue arose briefly after jury selection was completed yesterday. Prosecutors asked Judge Cormac Carney to bar the defense from arguing to jurors that the quiet propulsion technology and other data Mr. Mak allegedly sought to send to China were not subject to export controls. “If that’s his best argument … he’s going to crash and burn,” the judge said, referring to a defense lawyer, Ronald Kaye.
“I don’t want to crash and burn,” Mr. Kaye said, disavowing that argument. The defense attorney said he will argue that his client did not think it was illegal to export the data in question. Under the export law, the prosecution must show that Mr. Mak knew what he was doing was likely to be unlawful. Mr. Mak also faces charges that he acted as an unregistered agent for China and lied to investigators.
The defense seemed to score one win yesterday, when Judge Carney indicated he is inclined to rule that jurors may hear that security supervisors for the Navy contractor where Mr. Mak worked, Power Paragon, determined that one of three key technologies he is accused of trying to sending to China was not subject to export controls.
Despite the burgeoning Asian population in the region south of Los Angeles, the jury of eight women and four men contains only one Asian, a woman of Indian origin. At one point, one woman of Chinese descent made it into the jury box, but she was excused by the judge after she indicated that she was born in Taiwan and considers Communist China to be her “enemy.”
A spokesman for the prosecution, Thom Mrozek, said last week that he could not comment on the case while the trial is under way.