One Billion Customers - James McGregor [94]
Two days after a New York Times story detailed the accusation, Energy Secretary Bill Richardson fired Taiwan-born scientist Wen Ho Lee for “failing to properly safeguard classified material…” The FBI didn’t have sufficient evidence to bring espionage charges against Lee, but continuous FBI leaks and elaborate theories spun by Clinton’s opponents led to a media barrage that artfully blended administration approval of the Chinese satellite launches, the “Donorgate” campaign contributions, and the accusations against Wen Ho Lee. The implication was clear: the Clinton administration couldn’t protect America’s secrets and had solicited campaign contributions in exchange for giving U.S. and Chinese companies favored treatment.
Paying the Price
In April 1999, Bob Hitt was summoned to Washington for six hours of questioning by federal prosecutors investigating why the six machine tools had been rerouted to Nanchang without approval. Hitt was relieved when at the end of the session the U.S. attorney who had been questioning him said he had no worries.
“You really didn’t have anything to do with this,” the prosecutor told him.
A month later, the unclassified version of the Cox report was published. The narrative sections on the individual Loral, Hughes, and McDonnell Douglas cases were sober and factual. But the report’s analysis and conclusions were laughable to anyone who knew anything about modern China. The report portrayed the Chinese government as a monolith in which the Communist Party politburo controls all aspects of industry and commerce with the aim of challenging U.S. interests around the world. The report said that the “main aim for the civilian economy is to support the building of modern military weapons and to support the aims of the PLA [People’s Liberation Army].”
It was in this atmosphere that in the summer a new group of Justice Department prosecutors took over the McDonnell Douglas case. On October 19, 1999, a sixteen-count indictment was filed against McDonnell Douglas and CATIC. Hitt personally was indicted in the first count, which alleged that he and two CATIC employees—Hu Boru, a CATIC buyer, and Yan Liren, who had inspected the tools in Columbus—conspired to violate the laws of the United States. Suddenly Hitt faced a potential $250,000 in fines and five years in jail. McDonnell Douglas and Hitt pleaded not guilty.
The hastily drawn indictment was full of factual errors and creative legal theories. Hitt, for example, had never even met Yan Liren, his purported coconspirator. Investigators had simply taken Yan’s name off a list of inspectors who had journeyed to Columbus. Prosecutors wove together theories of “collective knowledge” and “conscious avoidance.” Even if no individual at McDonnell Douglas had committed a “willful and knowing” violation, the company’s “collective knowledge” amounted to a “willful and knowing” violation of export laws. Beyond that, the prosecutors said, McDonnell Douglas had ignored signs that CATIC might not build the Beijing machining center and in doing so had practiced “conscious avoidance” of information. That, in turn, led to the submission of false information on the export license application forms. The indictment clearly was aimed at appeasing the Pentagon and conservative Republicans in Congress rather than enforcing the law. McDonnell Douglas lawyers, filing massive discovery motions, used the indictments’ shortcomings to force the government to reveal the uninformed and inconsistent operation of the export control system.
Hitt was relieved in May 2001 when a federal appeals court dismissed the indictment against him. His attorneys had successfully argued that the five-year statute of limitations had expired because his alleged conspiracy with Chinese officials would have ended with the September 1994 export license approval, which was just over five years before his October 1999 indictment. Hitt, diagnosed with lung cancer three months after the indictment