U.S. v. Wieschenberg, 78-5218

• Decision Date: 09 October 1979
• Docket Number: No. 78-5218,78-5218
• Parties: UNITED STATES of America, Plaintiff-Appellee, v. Carl Lutz WIESCHENBERG and Carl John Heiser, III, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 326

604 F.2d 326

UNITED STATES of America, Plaintiff-Appellee, v. Carl Lutz WIESCHENBERG and Carl John Heiser, III,

Defendants-Appellants.

No. 78-5218.

United States Court of Appeals, Fifth Circuit.

Oct. 9, 1979.

Paul G. Marshall, Robert W. Cinque, James P. Cinque, Marshall, Morris, Powell, Silfen & Cinque, New York City, for Wieschenberg.

Steadman S. Stahl, Jr., Hollywood, Fla., for Heiser.

James L. Whitten, Asst. U. S. Atty., Miami, Fla., Robert D. Sharp, Internal Security Section, Crim. Div., Dept. of Justice, Washington, D. C., for plaintiff-appellee.

Appeals from the United States District Court for the Southern District of Florida.

Before WISDOM, GOLDBERG and VANCE, Circuit Judges.

VANCE, Circuit Judge:

On July 26, 1977, Carl John Heiser, III, and Carl Lutz Wieschenberg were charged in a four-count indictment with acting as agents of the Union of Soviet Socialist Republics and the German Democratic Republic without prior notification to the Secretary of State of the United States in violation of 18 U.S.C. § 951 (Counts I and II respectively) and with acting as agents of a foreign principal without having registered with the Attorney General in violation of 22 U.S.C. §§ 612, 618 (Counts III and IV respectively).

The first indictment was superseded on September 23, 1977, by a new indictment naming Carl John Heiser, III, Carl Lutz Wieschenberg, and Manfred Hardt. ¹ The new Counts I and II were identical to Counts I and II of the original indictment. Count III charged Hardt, Heiser and Wieschenberg with conspiring to violate 22 U.S.C. § 1934(c), its successor statute, 22 U.S.C. § 2778(c) and regulations promulgated thereunder, 22 C.F.R. §§ 123.01, 127.01, by willfully, knowingly and unlawfully conspiring to export from the United States to a foreign country a quantity of Litton Industries Inertial Navigation Devices, LTN-51s, an article designated on the United States Munitions List, 22 C.F.R. § 121.01, Category VIII(1), without first having obtained an export license or written approval from the United States Department of State as required by 22 C.F.R. § 123.01. Count IV charged that Heiser and Wieschenberg conspired to violate 50 U.S.C. App. § 2405(b) and regulations promulgated thereunder, 15 C.F.R. §§ 370.3(a), 377.1(a) and 387.6, by unlawfully, willfully and knowingly conspiring to export from the United States to the Union of Soviet Socialist Republics, various technical data on a 100-megabyte drive storage system computer manufactured by Memorex Corporation, without having first obtained authorization for the export from the Office of Export Administration of the Department of Commerce as required by the Export Administration Act of 1969, 50 U.S.C. App. § 2401, Et seq., and a regulation promulgated thereunder.

An arrest warrant was issued for Hardt, a West German citizen, but apparently no attempt to extradite him from West Germany was ever made. Heiser and Wieschenberg pleaded not guilty to all charges. Wieschenberg waived a trial by jury, but the government demanded a jury trial. ² The jury found Wieschenberg guilty as to Counts II and III and Heiser guilty on Count III. Both defendants moved for judgments of acquittal or for a new trial. Their motion was denied as to Count III, but the court granted Wieschenberg a new trial on Count II and subsequently dismissed that count. Consequently, Wieschenberg and Heiser stand convicted only under Count III. They now appeal that conviction.

The Demise of the Big "Spy Case"

The arrest of Wieschenberg and Heiser at the Fort Lauderdale Airport on July 20, 1977, culminated a fifteen-month investigation by federal authorities. It also set the stage for a lengthy trial most notable for its spectacular characterization as the "Missile Spy Case," and its extravagant front-page press coverage. ³

Heiser and Wieschenberg first met in 1975. During the period from 1975 until their arrest, they engaged in profitable business dealings that included the exchange of I.B.M. tapes, I.B.M. microfisch equipment and I.B.M. manuals and programs. During this period, the appellants discussed other potential business deals and, in connection with these other deals, conducted several meetings with various individuals. Their deals generally involved exportation of technical equipment that had a high profit potential. The government's evidence suggests that appellants were at least willing to cut a few corners in seeking to realize that potential.

Trial and pretrial publicity was quite substantial. Apparently anticipating general community disapproval of activities involving an eastern bloc country, the government cast this as the "Spy Case" and presented it accordingly. Its evidence falls short of supporting that characterization.

Count III, the only count with which we are concerned, charges only the attempted exportation of the LTN-51s in violation of the laws of the United States. The LTN-51 is not a defense secret; it is used extensively outside the United States. With proper authorization from the State Department LTN-51s can be sold freely to eastern bloc countries. As this case demonstrates, the government objects to its exportation to these countries unless it is installed in an airplane. The reason for the distinction does not appear in the record and need not concern us. Whatever the underlying policy, the statute and regulations must be obeyed. We will treat this case, however, as it should have been treated below, as a routine conspiracy case.

The convictions under Count III stem from an alleged conspiratorial agreement between Wieschenberg, Heiser and Hardt to obtain and export the LTN-51 navigational device without a permit. The 3500-page record and over 600 exhibits, however, deal primarily with Counts I, II and IV and have very little to do with the alleged conspiratorial agreement in Count III. Our task is to seek a kernel of wheat from this veritable mountain of chaff.

The LTN-51 Deal

In March or April 1976, Mr. Hardt, the owner of Carament Company, a West German electronics firm, met with Mr. Will of the Aero Leasing Company in Munich, West Germany, and discussed the possible purchase of LTN-51s. Through a friend, Mr. Will contacted Litton Industries and obtained a quotation for the LTN-51s to be received by Aero Leasing. At that time Mr. Will told Mr. Hardt that an export license was needed to deliver the LTN-51s outside the United States. Shortly afterward, an associate of Mr. Will received a telex from Litton Industries and forwarded the message to Mr. Hardt. The telex contained information about the restrictions on the LTN-51s ⁴ including the necessity of an export license complete with the name of the end user. A final meeting, held between Will and Hardt in early June, concluded in their voluntary abandonment of the venture.

At about this time, Heiser began having conversations with Albert Behar, an informant for the F.B.I. The discussions centered around the potential sale of LTN-51s. In the latter part of July 1976 Heiser planned a trip to Washington to meet with a source who would help him obtain the LTN-51s. Heiser then contacted Lloyd Williams, also an F.B.I. informant, through Williams' attorney. Around the middle of August 1976, Heiser and Williams met in Boca Raton, Florida, to explore prospective business opportunities. During this meeting Heiser and Williams discussed the potential LTN-51 transaction. Williams' contacts and his potential for obtaining the LTN-51s and the required export license were specifically mentioned.

Heiser, Williams, and Wieschenberg met in Freeport, Bahamas at the end of August. During this meeting the three men discussed the available LTN-51 opportunity. They later arranged a trip to Germany to meet with Wieschenberg's associates.

On September 10, 1976, Wieschenberg, Heiser and Williams went to the Carament Company in Wiesbaden, Germany, where they were introduced to Manfred Hardt and Eckheard Voss. During this meeting several deals were discussed including the one that involved the LTN-51s. Williams informed the parties that the LTN-51s required an export license and an end user approved by both Litton Industries and the State Department. In response, Hardt disclosed that his end user was in the Soviet Union and that he had been turned down by the State Department in his previous attempts to obtain LTN-51s for export to Russia. Hardt informed Williams that the end user could not be supplied; however, Williams would still be paid thirty percent commission if he could arrange a LTN-51 deal. The meeting in Wiesbaden ended in confusion. No deal had been consummated, no price had been determined, and no end user had been supplied. Williams returned to the United States after a short stop in Paris, France, while Heiser and Wieschenberg went to East Germany.

The LTN-51s were the subject of several meetings and conversations during the next two and one-half months. Heiser, who had visited the Russian Embassy in East Germany, expressed the Russians' interest in the deal, but Williams was unable to conclude the transaction. On November 19, Williams provided the serial numbers of some used LTN-51s to Heiser who indicated that he would relay the numbers to Hardt.

The transaction broke down immediately, apparently because the used Litton gyroscopes were not satisfactory and the Russians were unhappy about dealing with Williams.

The government submits that there is substantial evidence of a conspiratorial agreement between Heiser, Wieschenberg, Hardt and unknown Russian officials to export the LTN-51s out of the United States without the proper export license. Heiser and Wieschenberg urge that an agreement was never reached and that the government failed to prove that they had the requisite specific intent to violate this statute. ⁵

We conclude that the evidence is insufficient to support the convictions, but for a slightly different reason than the one urged by Heiser and Wieschenberg.

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