Unfiled
Amendment #5
Signed in Moscow on 20 December 1984
Items removed
1. Plasma modification for any of the nine furnaces.
102,000 pounds
6.6 Two sets of carbon internal heating elements for isopress. 86,200 pounds
Items added
2.7 Equipment and technical documents to produce Calcarb. 102,000pounds
We would have required a license to give them the formal technology for this process. They had already observed the process in Scotland and probably could do it better. We could avoid giving them formal technology.
6.6 Two sets nickel alloy heating elements for isopress. 86,200 pounds
Amount of contract remained unchanged.
Technical changes
The amount of argon use per cycle was changed from one to three standard bottles for an isopress cycle.
Temperature required reduced from 1000 degrees to 900 degrees in the isopress. Heating time remained at one hour.
Heating time to 900 degrees set at one hour for the isopress.
Cooling time from 900 to 300 degrees increased from on to six hours.
All these changes were realistic for the equipment we were completing in Scotland. The single bottom element for the isopress would have made it useless for the purpose intended but I did not understand this until I read the FMI trial transcripts in 1996.
"The sellers undertake to pursue further development on a satisfactory method to allow recycling of the argon gas external to the sealed container and the body of the isopress. The argon gas being filtered and provided with a complete set of pressure relief valves and interlocks to insure the safe operation of the system."
If a fully sealed container was used and piped so the bad gases from pitch were vented to the outside through a proper relief valve and a slight positive pressure was maintained on the outside my battle was won. There would be no contamination of the argon and the small liquidfier already delivered would do the job. I learned that FMI was doing this as a routine for many years when I read the transcripts in 1996.
"The sellers, to obtain this information, will carry out the necessary tests in its isostatic press (which is identical in design and construction to those supplied to the buyers) at Bellshill, Scotland."
This was possible but we were not ready to carry out these tests and the costs would have been extremly high. I suppose we could have done these tests without the Russians observing and reported the results without providing them with autocalve technology. My plan at that moment was to apply for a license in Washington before proceeding.
"Should these tests identify that additional components are required to insure satisfactory operation of the installation at the buyers works, then the sellers hereby agree to supply such equipment at no additional costs to the buyers. The sellers, however, reserve the right to exchange any previously supplied components in the gas system which are subsequently, found as a result of later developments, to be no longer required to complete the successful installation. It is understood that all shipping costs for any returned components are to the account of the sellers."
To cover the advance of 1,200,000 pounds they were paying at the time:
"In the case of unsatisfactory results of the above tests the sellers will return to the buyers the sum of 1,200,000 pounds at the first written demand of the buyers. In this case the buyers have the right to stop any further payments in favor of the sellers."
Additional notes:
New rules and the new political climate assured me that sooner or later the job would be embargoed. The technology and testing required by the pending amendment would put us in conflict with American technical data regulations, and I felt the US government would say no when asked.
The technical data laws in effect at that time were aimed at stopping the flow of technical information. Our Constitution did not bother the regulators. Almost every company in the United States broke this law. It was almost like putting a twenty mile speed limit on the Interstate and telling the cops to pull people over if and when they needed to punish them for something else. I am not aware of a single case where the government prosecuted using this law.
Section 379.1 of the regulations in effect October 1984 read as follows:
(a) Technical Data
"Technical Data" means information of any kind that can be used, or adapted to use, in the design, production, manufacture, utilization, or reconstruction of articles or materials. The data may take a tangible form, such as a model, prototype, blueprint, or an operating manual; or they can take an intangible form such as technical service.
(b) Export of Technical Data
(1) Export of technical data means__
(i) An actual shipment or transmission of technical data outside the United States.
(ii) Any release of technical data in the United States with the knowledge or intent that the data will be shipped or transmitted to a foreign country; or
(iii) Any release of technical data of U.S. origin in a foreign country.
(2) Release of technical data. Technical data may be released for export through__
(i) Visual inspection by foreign nationals of U.S. origin equipment and facilities;
(ii) Oral exchanges of information in the United States or abroad; and
(iii) The application to situations abroad of personal knowledge or technical experience acquired in the United States.
General licenses were granted for information generally available from trade shows, library conferences and other media open to the public. Technical data for a contract that did not need a license could be sent out for one year after shipment if it did not involve the manufacture of a commodity. The rat's nest the buyers were putting me in was:
(II) Technical data (including processing conditions) and procedures for the regulation of temperature, pressure and/or atmosphere in autoclaves when used for the production of composites using materials controlled by ECCN 1763A of the Commodity Control List;
ECCN 1763A was high strength carbon fibers, and even a dummy would have known they would use fibers of some strength to make products with this type equipment. Up to this moment I had avoided technology except to allow the Russians to observe the production of Calcarb. The basic technical data for this and the isopress technology was released and printed by Union Carbide at Oak Ridge in 1971 using U.S. government money.
It made sense to ship as much as we could before the embargo because we were insured. What we were shipping would not alter the balance of power and nothing we were shipping required a license. The main worry was our financial problems. It was my hope that the British government would quickly embargo the project. I was greedy and wanted the last shipment out to maximize the insurance claim.
Amendment number 5, which I was going to sign, almost guaranteed that US law would stop the project. The buyers were demanding autoclave technical data. As an American owned company in Scotland we would need to apply for a specific license and it would be refused. We would have been stopped due to USA laws and according to the written insurance documents would be insured for 95% of the invoice value.
I was not causing the embargo in a covert manner. Rather changes in the world politic would bring about an embargo. If the Soviets wanted autoclave technology that could produce high strength carbon composites then a license would be required by law. They were demanding the technology that I had not sold them and did not know how to complete the required process.