Monthly Archives: March 2017

March 28, 2017

D.C. Circuit Strikes Down Challenge to Application of ITAR Brokering Regulations to Practicing Attorneys

by Gwen Green and Amani S. Floyd

On March 14, 2017, the D.C. Circuit dismissed a law firm’s challenge to the State Department’s application of the International Traffic in Arms Regulations (“ITAR”) Part 129 brokering provisions against practicing attorneys.  In its lawsuit, law firm Matthew A. Goldstein, PLLC (“Goldstein”) alleged that the State Department lacked constitutional and statutory authority to apply Part 129 to legal services provided to its clients and sought declaratory and injunctive relief to prevent the State Department from applying the brokering provisions to the firm.[1]

Regulation of Brokering Activities

The State Department regulates international arms brokering under the Arms Export Control Act (“AECA”) and the ITAR.  The AECA mandates that “every person . . . who engages in the business of brokering activities with respect to the manufacture, export, import, or transfer of any defense article or defense service” shall register with the State Department and obtain a license before engaging in “the business of brokering activities.”[2]  The AECA further provides that “brokering activities shall include the financing, transportation, freight forwarding, or taking of any other action that facilitates the manufacture, export, or import of a defense article or defense service.”[3]  These requirements are implemented and further defined at Part 129 of the ITAR. Continue reading

March 8, 2017

First Circuit Affirms Lengthy Sentence of Chinese National Who Provided U.S. Goods to Iranian Nuclear Program

by Gwen Green and Steven Pelak

On March 1, 2017, the First Circuit affirmed the nine-year sentence of Sihai Cheng, a Chinese national who pleaded guilty for his role in supplying over 1,000 pressure transducers to Iran’s nuclear program.

In December 2015, Cheng pleaded guilty to two counts of conspiring to commit export violations and smuggle goods from the United States to Iran and four counts of illegally exporting U.S. manufactured pressure transducers to Iran.  On January 27, 2016, U.S. District Court Chief Judge Patti B. Saris departed upward from the Sentencing Guidelines and imposed a nine-year sentence, which is significantly beyond the otherwise applicable Guideline range.  It should be noted that Chief Judge Saris has served as the Chairperson of the U.S. Sentencing Commission. Continue reading