Dr. Roth Case Presentation

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February 5, 2012

The US Department of Justice Case AgainstThe US Department of Justice Case AgainstDr. John Reece Roth: Impact & ImplicationsDr. John Reece Roth: Impact & Implications

Trade Compliance Solutions

Presented by: John P. PrieckoPresident and Managing PartnerTrade Compliance Solutions

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CASE SUMMARY/HISTORY

On Wednesday, September 3, 2008,a Federal Jury convicted retired University ofTennessee Professor Dr. J. Reece Roth, after a seven

The US Department of Justice CaseThe US Department of Justice Case

Against Dr. John Reece RothAgainst Dr. John Reece Roth


,information relating to plasma technology designed tobe deployed on the wings of drones operatingas a weapons or surveillance systems.

[Reference: US Department of Justice (DOJ)Press Release (PR), 9/3/2008]

NOTE: Dr. Roth was sentenced July 1, 2009.He began serving it on January 18, 2012.

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Todays guilty verdict should serve as a warning toanyone who knowingly discloses restricted militarydata to foreign nationals. (Patrick Rowan, Assistant US



DOJ QUOTES OF NOTE


ttorney or at ona ecur ty, ,

This verdict, by a jury of Dr. Roths peers, demonstrates thatour citizens and the United States will not tolerate suchinternational conduct to undermine the security and the economy

of our country. Our scientific and educationalcommunities must take precautions to insurethat technology and research are protected....

(Russ Dedrick, US Attorney, DOJ PR, 3/8/2008)

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INDICTMENT & CONVICTION(All Knowingly & Willfully)

One count of conspiracy with Atmospheric GlowTechnologies, Inc. (AGT) to unlawfully export in2005-06 fifteen defense articles/services to foreignnationals [i.e. Peoples Republic of China and Iran




in violation of the Arms Export Control Act (AECA)] Fifteen counts of violating the AECA

One count of wire fraud related to defraudingthe University of Tennessee (UT) of honest

services by illegally exporting sensitivemilitary technology relating to thesubject US Air Force Contract

A-GTECH.COMA-GTECH.COM

(Reference, DOJ PR, 9/3/2008)

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MAXIMUM PUNISHMENT

On the conspiracy conviction:5 years in prison and a fine of $250,000

On the 15 AECA convictions:Ten years in prison for each offense and a




criminal fine of $1,000,000 for each offense On the wire fraud conviction:

20 years in prison and a fine of $250,000

Mandatory Special Assessment:

$100 for each offense WORST CASE TOTAL: $15,501,700

in fines & 175 years in prison

(Reference, DOJ PR, 9/3/2008)

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SENTENCING(US Federal Sentencing Guidelines)

Some of what the Judge considered: Characteristics, circumstances, nature and seriousness of the case Knowing, willful, reckless intent/nature & obstruction of justice




Self-reporting, cooperation and acceptance of responsibility Providing just punishment & affording adequate deterrence Protecting the public interest & national security Promoting respect & abiding by the law Aggravating & mitigating circumstances Prior history/misconduct Ability to pay restitution Collateral consequences Evidence

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ACTUAL PUNISHMENT

Four years in jail followed by2 years of Supervised Release

Thats 15 months less than the minimum



DR.ROTH SENTENCED!


and 30 months less than the minimum

sought by the US Government (USG).

Only monetary fine was the

$1,700 Special Assessmentwhich the judge waived.

(Reference, DOJ PR, 9/3/2008, other related Knoxville News Sentinel articles)

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ACTUAL PUNISHMENT

After a lengthy appeal effort, onOctober 3, 2011, the US Supreme Courtdenied Roths petition to hear his case.



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JOHN ROTHREGISTER NUMBER 32252074FCI ASHLAND

FEDERAL CORRECTIONAL INSTITUTIONPO BOX 6001

ASHLAND KY 41105

importance of export compliance toacademia and industry, especially in theresearch and development communities.It underscores the criminal consequences

of non-compliance and what happens tothose who knowingly and willfullyviolate export control laws.

(Bill Killian, US Attorney, DOJ PR, 2/1/2012)


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CO-CONSPIRATOR DANIEL MAX SHERMAN

Educated & Trained as a UT Physicist

Graduate Student under Dr. Roths supervision AGTs Director, Founder and the Program Manager

and Lead Scientist on the contract with Dr. Roth




to commit the offenses specified in the Indictment

SENTENCE: Worst Case: 5 years in jail and a$250,000 fine - Actual: 14 months in prison

Prosecution sought 28 months due to Shermanscooperation as he provided extensive information anddocuments to investigators that led to Dr. Roths conviction.

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(Reference, the related Knoxville News Sentinel article, 8/10/2009,and Jeff Theodore, Assistant US Attorney, Knoxville TN)


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IMPLICATIONS/LESSONS LEARNED

The USG is always willing to take aggressive measuresto prevent unauthorized exports, particularly to certain countries.

Academic & research institutions as well as defensecontractors are NOT immune from such prosecutions.




NOT everything thats perceived as fundamental researchqualifies as exempt from USG licensing requirements.

When working on USG or defense-related projects review policies,processes and procedures on research & collaborative projects to makesure they are thoroughly screened for export control issues before

being undertaken and on an ongoing bases to ensure compliance.

Providing export-controlled technology to a foreignnational /person by any means is an export.

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Questions to Consider:

- Do the consequences and sentences fit the crimes?

WHAT DOES IT ALL MEAN?

??


- as us ce serve o e appropr a e egree- Whats the impact on the trade compliance community?

- How many others are making similar transfers?

- Whos providing education and training in this arena?

- What message does the outcome send?

?? ??

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aueco.org


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Remember:

The AECA has a very long reach.

The US Department of Justice Case AgainstThe US Department of Justice Case AgainstDr. John Reece Roth: Impact & ImplicationsDr. John Reece Roth: Impact & Implications


JOHN P. PRIECKOPresident and Managing Partner

Trade Compliance Solutions9312 Manassas Drive, Manassas Park VA 20111-8203

Phone: (703) 368-0384Cell (703) 895-1110

Email: [email protected]

IN CONCLUSION - Questions, Comments, Other

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Dr. Roth Case Presentation

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