One Side of the Coin: ACCG Re-Argues Previously Decided Legal Issues in Baltimore Test Case

Some of the ancient coins in dispute in U.S. v. 3 Knife-Shaped Coins.

Court decisions in 2014 and 2015 rejected the Ancient Coin Collectors Guild’s (ACCG) demand to revisit legal issues already quashed by the courts in the forfeiture case of U.S. v. Three Knife-Shaped Coins Et al. and the related case of Ancient Coin Collectors Guild v. U.S. Customs and Border Protection; U.S. Department of State; Assistant Secretary of State, Educational and Cultural Affairs. Nevertheless, the Guild continues to re-argue the same issues.

The litigation stems from the ACCG’s aim to strike down or erode customs regulations that regulate the import of specific types of ancient coins that have been determined to be in jeopardy of looting. The group minted a test case seven years ago when it intentionally imported undocumented and unprovenanced ancient Chinese and Cypriot coins to the United States. The Guild imported the archaeological materials from a London dealer and shipped them to Baltimore on a British Airways flight. The ancient coins had no accompanying documentation and offered no record of chain of custody or provenance.

Repeated losses suffered by the ACCG in the federal district court, the court of appeals, and the U.S.Supreme Court have not deterred the Guild from continuing its blitz on the import controls, which were erected under authority of the Convention on Cultural Property Implementation Act (CPIA) and are designed to curb transnational trafficking of at-risk archaeological material.

The latest round of ACCG court filings is a motion for summary judgment that repeats many arguments that already have failed to win judicial support. In its July 2016 motion, the Guild insists that it “has either rebutted the government’s prima facie case and/or the government has failed to meet its own burden. Accordingly, the Court should grant the Guild Summary Judgment, order the return of the Guild’s coins, and require the Government to pay the Guild’s attorney’s fees and costs.”

While the ACCG litigates the Three Knife-Shaped Coins case in federal district court in Maryland, it is expected that the Missouri-based group simultaneously will press the matter when the Cultural Property Advisory Committee (CPAC) meets in Washington, DC on October 25. That is when CPAC will hear public testimony about whether the White House should renew import controls to protect pre-classical and classical archaeological objects and Byzantine and post-Byzantine ecclesiastical and ritual ethnological materials from Cyprus, Docket No.DOS-2016-0054.

So far the ACCG’s defeats in the federal courts have produced favorable case law that strengthens law enforcement efforts to disrupt cultural heritage trafficking. The Fourth Circuit Court of Appeals, for example, decided that federal authorities properly listed the kinds of ancient Chinese and Cypriot coin artifacts that may be subject to CPIA import controls.

The appeals court also ruled that U.S. Customs and Border Protection (CBP) properly detained the ACCG's undocumented coins. The court explained that the burden therefore shifts to the Guild to prove that its actions were lawful, plainly articulating the clear rule that "[t]he importer need not document every movement of its articles since ancient times. It need demonstrate only that the articles left the country that has requested import restrictions before those restrictions went into effect or more than ten years before the date of import.” “In short,” the court added, “CBP need not demonstrate that the articles are restricted; rather, the statute ‘expressly places the burden on importers to prove that they are importable.’”

The ACCG rejects this standard. Rather than offering information to show that the ancient archaeological materials qualify as a legal import, the ACCG instead filed motions for discovery and a motion for summary judgment attacking the validity of the import regulations themselves. Meanwhile, the Guild maintains that the government bears the high burden to prove that the restricted ancient coins were first discovered in and subject to the export controls of China and Cyprus.

At a motions hearing held earlier this year, Assistant U.S. Attorney Molissa Farber, representing the government, told the Maryland district court that the Guild's line of argument is “essentially an attack on the government's ability to classify the coins by type and category, which has already been well-settled that we can do.” “And I understand that Claimants [ACCG] disagree with that process,” the prosecutor said, “but that's already been litigated. That’s not at issue here. That part is done.”

AUSA Farber reminded the court that “the Fourth Circuit rejected the notion that the government was going to have to fight a case coin-by-coin. The Fourth Circuit said that the statutory structure allows us to list coins by type and category.”

She emphasized that “the evidence that the Guild seeks to introduceis not evidence pertaining to the specific defendant property here. They’re not seeking to introduce any kind of evidence that relates to these 22 defendant coins as far as when these specific 22 coins left China and Cyprus.What they want to introduce is general evidence that coins of this type of category circulated broadly and may have left China and Cyprus outside of the regulated period.”

Peter Tompa, attorney for the ACCG and the organization's current president, countered, “The coins at issue here are typical in the market. So we don't know where they were found or too much about them. And there’s nothing nefarious about that, Your Honor. It’s a situation where there’s just low value items, and it was not important until recently that such things would be -- that such things should have a documentary history. But we do know something about the coins, we know something at least. We know that they were exported from the UK by Spink, a well-regarded firm that's been around since the 1600s, and in compliance with both UK and EU law in April,19 2009.”

Attorney Tompa continued, “Well, assuming the government has established first discovery just by listening, we’re entitled to rebut that. And how we’re trying to do that here with regard [to] these specific coins is by offering the opinions of two experts, Mr. [Douglas] Mudd, who is the Curator at the American Numismatic Association in Colorado, and Mr. [Michael] McCullough, who’s an expert in the international exchange of cultural artifacts.”

Declaring that “scholarly evidence” can be used by the ACCG to show that the coins left their countries of origin before the enactment of U.S. import restrictions, Attorney Tompa offered that “Mr. Mudd's opinion is that the ancient coins at issue here are of a sort that circulated in significant numbers outside of China or Cyprus for thousands of years[,] first as currency and then as collectibles. So it’s unlikely and cannot be assumed that they left Cyprus or China after the date restrictions were imposed.”

“So because these things circulated for thousands of years first as collectibles -- first as currency, then as collectibles," Attorney Tompa reasoned that "it’s unlikely that they exited Cyprus or China after the date of the restrictions, just given the numbers outside of those two countries.”

“Mr. McCullough's report is that UK and EU law did not require expert [sic] certificates for the coins at issue in this case, or the Cypriot -- well, any of the coins at issue in this case. And such with respect to the Cypriot coins, that would satisfy Cypriot law, because, after all, Cyprus is a member the EU as well. Mr. McCullough also opines that the Chinese coins here could have exited Hong Kong legally without documentation in that export would satisfy Chinese law under both the laws of China and Hong Kong.”

AUSA Farber countered this argument by rejoining, “The most salient point I think to take away from this particular dispute over the scholarly evidence at least is the distinction between specific and general. And I believe what we just heard from Claimant [ACCG] was a lot of purported evidence regarding general coin circulation. The coins are of the sort that circulated broadly. I mean, Your Honor raised the point, what’s the ultimate implication here? And the implication is that if that argument is allowed, it undermines the CPIA, undermines the statutory structure, because it essentially holds the coins shouldn't have been listed in the first place based on their type of category. And that’s not permitted.”

U.S. District Judge Catherine Blake agreed. In a ruling dated February 11, 2016, Judge Blake pronounced “that the Ancient Coin Collector’s Guild (“the Guild”) seeks discovery not relevant to the issues the court will have to decide in this forfeiture action.” In particular, she highlighted that the ACCG “apparently will seek to prove that the export of these coins from Cyprus or China to England was lawful under EU law. It is unlikely that the export control status of the coins under foreign law will be a proper defense in this forfeiture action.” The judge added pointedly, “Further, to the extent the Guild argues that the government must prove ‘first discovery,’ beyond demonstrating that the coins at issue appear on the designated list, that argument is foreclosed by the CPIA and the Fourth Circuit opinion in Ancient Coin Collectors Guild v. U.S. Customs and Border Protection, 698 F.3d 171 (4th Cir. 2012). Listing by type and category is proper under the CPIA.”

Judge Blake also granted a protective order shielding two State Department employees from ACCG depositions, explaining that they “do not appear to have relevant personal knowledge.” Over the objections of Attorney Tompa, AUSA Farber attributed “ulterior motives” to the Guild's attempt to depose the purported witnesses, presenting the court with, what the federal lawyer called, an “Internet post written by a former director of the Coin Collectors Guild" criticizing one of the witnesses. Judge Blake remarked, “I'm more interested in probably the relevance than in motive.”

In June, Judge Blake issued a further order rebuking the ACCG's discovery requests, stating, “I will not at this time direct the government to provide any additional 30(b)(6) deposition testimony.”

Soon afterward, the ACCG filed its motion for summary judgment and, on July 29, the court adopted a schedule that allows the parties to fully brief their positions. Once completed in mid-October, CHL expects to review the parties’arguments.

Text and original photos copyrighted by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL works in cooperation with Red Arch Cultural Heritage Law & Policy Research, Inc.

Museum Raids Cases: Rare Antiquities. Rare Convictions for Gallery Owners. Rare Prison Sentence.

In the annals of cultural property law, prosecutions targeting transnational antiquities trafficking networks are rare. Even more rare are felony convictions. Scarcer still are prison sentences.

So what happened this week to a pair of California gallery owners tied in with the "Museum Raids" cases is a momentous achievement, an example of careful and intelligent case development by the U.S. Attorney's Office for the Central District of California, resulting in felony convictions for antiquities traffickers rather than a "seize and send" photo-op that cultural property watchers are accustomed to witnessing.

Jonathan and Carolyn Markell, aged 70 and 68 and owners of Silk Roads Design Gallery, were sentenced on Monday for their role in an elaborate scheme that mixed international heritage trafficking with tax evasion.

Calling the crime "significant," United States District Judge Dean D. Pregerson said it was “important to send a message” to art collectors, gallery owners and museums that they should avoid collecting and trading looted antiquities.

The court handed down an 18 month prison term to Jonathan Markell on a felony count of conspiring to import goods using false statements in violation of 18 U.S.C. § 371 (conspiracy) and 18 U.S.C. § 542 (importing goods using false statements). His wife, Carolyn, received a sentence of probation on a felony charge of conspiracy to commit tax evasion pursuant to 18 U.S.C. § 371. Jonathan Markell also pleaded guilty to conspiracy to commit tax evasion.

“Mr. Markell’s greed placed his art gallery’s profits above the culture and heritage of the people of Thailand,” said United States Attorney Eileen M. Decker in a press release.

There were no complaints about the court's 1 1/2 year sentence, even though prosecutors sought a 2 ½ year prison term for Jonathan Markell because, in prosecutors' words, "it is clear that Jonathan Markell has no respect for the law—not this nation's laws, nor those of other nations."

In seeking a prison term, prosecutors, notably among them Assistant U.S. Attorney and Environmental Crimes Chief Joseph Johns, sought both specific deterrence and general deterrence.

The attorneys pointed out the obvious to the court, that "it is rare that law enforcement officials have the opportunity to catch a broker, bulk sellers, or gallery owner that drives the illicit market for archeological resources." That is why, they contended,

Defendant Jonathan Markell’s antiquities smuggling case presents a unique opportunity to send a message and afford adequate deterrence to the 'upper end' of the criminal black market for looted archeological resources, i.e., the brokers and gallery owners who sell their wares to the collectors. If we are able to diminish and disincentivize the market (or demand) for illegal antiquities, then we may have an equal effect on taking the monetary incentives out of the act of looting itself. It is the market, or demand, which drives the looters at the ground level to provide the supply of stolen antiquities to meet that demand. 

Jonathan Markell’s sentence of 18 months behind bars perhaps is the most ordered by a court in a transnational antiquities trafficking case since U.S. v. Schultz, a federal case from 2002 that saw Frederick Schultz, a high profile and successful Manhattan antiquities dealer, sentenced to serve 33 months in prison after a jury found the defendant guilty of the felony of receiving stolen Egyptian antiquities that had been transported in interstate and foreign commerce in violation of 18 U.S.C. § 371 (conspiracy) and 18 U.S.C. § 2315 (the National Stolen Property Act).

That case failed to serve as a warning to the Markells as the investigation into the husband and wife and their co-conspirators began the following year, in 2003 when a National Park Service (NPS) special agent began to uncover the trafficking network that had been smuggling archaeological material from Southeast Asia.

In January 2008, federal agents from several law enforcement agencies raided a variety of locations, including four museums in California. Police descended on the Los Angeles County Museum of Art, the Bowers Museum, the Pacific Asia Museum, and the Mingei Museum with search warrants to “seize in place” ancient objects identified as potential evidence. Officials simultaneously seized evidence from the Markell’s home as well as their art gallery.

The museum raids generated three published criminal cases:

• United States v. Robert Olson and Marc Pettibone, et al., which charged a conspiracy to smuggle Southeast Asian artifacts, including from Thailand and Cambodia, into the United States beginning in 2004;

• United States v. Robert Olson and Jonathan Markell, which charged a conspiracy to smuggle Southeast Asian artifacts, including Burmese antiquities obtained in Thailand beginning in 2003; and

• United States v. Jonathan Markell and Carolynn Markell, which charged a conspiracy to commit tax fraud by making false statements when donating smuggled artifacts to museums in an effort to receive tax deductions.

[Sidebar: At least one media report by the Pasedena Patch suggests that legal action against unnamed museums resulted in deferred prosecution agreements. These agreements do not appear in the court system’s public files. It is possible that they are held privately by the U.S. Attorney's Office and not subject to public disclosure]

The Markells pleaded guilty to criminal charges on April 16 after signing a written agreement with federal prosecutors the previous month..

As part of the deal, both defendants conceded that they conspired to knowingly and intentionally defraud the United States for the purpose of impeding, impairing, obstructing, and defeating the lawful government functions of the Internal Revenue Service (IRS) in the ascertainment, computation, assessment, and collection of income taxes, by promoting and participating in a false charitable deduction scheme for the purpose of improperly claiming charitable deductions on federal income tax returns.

The Markells agreed to repatriate 337 artifacts by ocean-borne cargo to their countries of origin, specifically China, Thailand, Cambodia, and Burma; to pay the $25,000 estimated shipping cost; and to cooperate with the IRS to calculate back taxes and penalties from 2004 through 2007, estimated to be $39,891.

In a court pleading filed on December 3, attorneys for the government elaborated on the facts of the case:

In short, Jonathan and Carolyn Markell jointly owned and operated the business Markell Imports, Inc., doing business as the Silk Roads Design Gallery ("Silk Roads"). The Markells’ business model consisted of their purchase and importation of art, antiques, and archeological resources from Southeast Asia, and their resale of such merchandise through their Silk Roads art gallery in West Hollywood.

Part of their business model included the intentional use of false declarations and statements in United States Customs entry documents to “smuggle” or introduce the archeological resources “antiquities” into the United States.

The lawyers flagged a contention made by the Markells, one that is often echoed by ethically ambivalent antiquities dealers who complain that filling out customs forms is too burdensome for small business owners:

During [a police interview], Jonathan Markell stated that he and Carolyn Markell falsified the customs documents to disguise what they were importing because the United States Immigration and Customs Enforcement classification process is difficult if they actually identify a piece as an "antique." Carolyn Markell agreed with her husband's statement.

The Markells further justified their behavior by claiming that United States Customs forces people to lie on import declarations because of the delay in clearing Customs if they properly identify an object as an antique.

Prosecutors added that the Markells failed to fully disclose their criminal conduct to investigators. “For example, they did not admit that Jonathan Markell had conspired with [a] co-defendant to not only falsely describe Burmese and Khmer antiquities in United States Customs import documents ... but also to falsely declare the import value of those antiquities as 25% of their true purchase price.”

The attorneys said that neither defendant “admitted ... that they knew that it was illegal to export archeological resources/antiquities from the countries of China, Thailand, and Burma—which is most likely the reason that the antiquities were falsely described in United States Customs import documentation.”

Focusing on the pairs’ systematic plan to dodge federal taxes, prosecutors noted that the operation “was heavily dependent upon the ready availability of Southeast Asian antiquities obtained ... through the antiquities smuggling scheme .... The Southeast Asian antiquities smuggled into the United States ... were bundled and sold for approximately $1,500. The[] $1,500 ‘package’ typically included antiquities from Ban Chiang, Thailand, false sales invoices to reflect an earlier sales date, along with a fraudulently inflated $5,000 appraisal that contained a fraudulent expert's signature.”

Prosecutors called the defendants' conduct a “complete contempt for this Nation's rule of law," spotlighting "Carolyn Markell's discussion of the International Emergency Economic Powers Act ("IEEPA") Burmese sanctions with the undercover agent ('UC') in this case":

During that discussion, she told the UC that she had been extremely worried about the last shipment of antiquities that she and Jonathan Markell had brought into the United States from Thailand in September 2006—which had included 7 Burmese statues. She related to the UC that the President of the United States had prohibited entry of any Burmese items into the country, and that she had lost sleep worrying that their import shipment would be intercepted by United States Customs authorities. She told the UC that she did not care about being dishonest, but that she didn’t want to get caught.

Jonathan Markell, meanwhile, “brought up a Los Angeles Daily News article about an individual that had been prosecuted for a tax evasion scheme involving antiquities and a museum," according to prosecutors. "Jonathan Markell laughed about the article, and then asked the UC if he thought that he (Jonathan Markell) was going to jail (for the tax evasion scheme). Jonathan Markell told the UC that the person who had been caught must have done something pretty stupid, and that the government was not going to look at any donation under $10,000.”

The tax scheme relied on the couples’ assumptions that customs officials would overlook mislabeled illegal shipments and that museums and collectors would fail to conduct the due diligence necessary to verify the archaeological objects’ legitimate collecting histories.

Antiquities mostly from Thailand's Ban Chiang World Heritage site were used to fuel the fraud, according to recitals found in the plea agreement, which described how Jonathan Markell “solicited co-conspirators to buy a 'charitable donation package' that included one or more Ban Chiang antiquities to be donated to a charitable institution.” Then “Silk Roads Design Gallery prepared false appraisals for donations of these antiquities to charitable institutions, such as museums and universities using another person’s name.” Jonathan Markell thereafter “contacted charitable institutions to get them to accept his, defendant Carolyn Markell’s, and his co-conspirators donations.” Specifically, prosecutors alleged:

“On or about December 26, 2003, CAROLYN MARKELL sent an email to a museum representative regarding the provenance of donated items as being a purchase in 1984.
Defendant CAROLYN MARKELL determined that she and defendant JONATHAN MARKELL would purchase items to be donated from a certain co-conspirator. Between an unknown date and January 2008, although defendant JONATHAN MARKELL knew that the seller of a donated item could not appraise the item for tax purposes, he prepared appraisals that falsely inflated the value of donation items he sold as part of a "donation package" he sold to co-conspirators. … In or about April 2007, defendant JONATHAN MARKELL advised an unindicted co-conspirator to change the listed purchase date on a museum donation form because it needed to appear that the co-conspirator had held the item for years, namely, ten years, to take the inflated value as a tax deduction. On or about March 10, 2006, defendant CAROLYN MARKELL contacted a museum curator to discuss the museum's policies and requirements. On or about June 14, 2006, defendant JONATHAN MARKELL solicited a Thailand museum curator's electronic signature which he fraudulently inserted on appraisals of items to be donated that he had prepared. ... On or about March 27, 2007, defendant JONATHAN MARKELL electronically mailed a request to the museum curator in Thailand to sign forms to support co-conspirators' charitable donation tax deductions and to sign six to eight blank forms in blue, to support fraudulently future donations. On or about December 13, 2007, JONATHAN and CAROLYN MARKELL delivered donations to a museum on behalf of a client. Around December 2007, defendant JONATHAN MARKELL donated Ban Chiang antiquities to a museum on behalf of co-conspirators, charging them $3,450 for the items and appraisals to support an $11,425 charitable donation income tax deduction.

Meanwhile, from 2004 through 2007, the Markells regularly donated Ban Chiang artifacts to an unidentified museum(s) and took a charitable tax deduction, “knowing the items had been stolen from the country of Thailand.”

In their steady march toward convictions and incarceration, the U.S. Attorney's Office tapped into its experience with wildlife trafficking cases—an instructive parallel to antiquities trafficking cases. Prosecutors wrote in a sentencing pleading dated Dec 3, 2015:

There are two types of archeological resource looters: (1) the looter that digs up and collects artifacts as a hobby for his or her own personal collection; and (2) the looter that digs up artifacts for the purpose of selling them to brokers or gallery operators. As with the protection of threatened and endangered wildlife species, the key to protecting and conserving archeological resources is to eliminate markets for illicit/looted antiquities. Without the existence of brokers, middlemen, and gallery owners who are willing to knowingly and intentionally profit from sales of parts and products of threatened or endangered wildlife species or looted archeological resources, there is little monetary incentive for wildlife poachers or archeological resource looters to engage in their nefarious trades.

One might be tempted to think that the archeological resource looter squatting in the deep mud and steaming jungle highlands of Ban Chiang, Thailand is primarily to blame for the devastation of pristine archeological sites and the information lost thereby—just as one might be tempted to lay the bulk of the blame for the loss of the last Northern White Rhinoceros at the feet of the poacher who killed it; but that line of thinking is incorrect. It is individuals such as Jonathan Markell ... the importers, the buyers, and the gallery owners who purchase and acquire such archeological resources or wildlife products for profitable resale who are primarily to blame for the underlying devastation. For these are the individuals who create the markets that create the monetary incentives that drive the poachers and looters into the fields.

The government's lawyers thereby laid the groundwork to argue for a prison term, “to reflect that seriousness and to promote respect for the law and to provide just punishment for the offense."

Meanwhile, they made the important point that “[a]rcheological resources are non-renewable. The looting of archeological resources causes widespread destruction of archeological sites and results in the loss of archeological information which would be gleaned from a properly excavated site."

They informed the court as well about the enormous impact of cultural plundering on the Thai people. “Many villages throughout Southeast Asia have been deprived of the opportunity to grow an economy based on archeological tourism because their heritage and archeological resources have been devastated by looting activity to supply to the purveyors of 'stolen time,' such as defendant Jonathan Markell."

Prosecutors poignantly added, "Criminal conduct, like that committed by defendant Jonathan Markell in this case, serves to deprive individuals from other countries of their own distinctive histories and heritages—in essence stealing not just their antiquities, but their 'time and history."

Two witnesses reinforced these arguments when they testified this week at the sentencing hearing. One witness was the NPS agent who investigated the case, and the other was archaeologist Dr. Joyce White, director of the Ban Chiang Project housed at the University of Pennsylvania Museum.

Dr. White analyzed more than 10,000 artifacts, mostly from Thailand, which police obtained through Operation Antiquity, the code name used by NPS, U.S. Immigration and Customs Enforcement Homeland Security Investigations, and IRS Criminal Investigation for the Museum Raids investigation.

In a court Declaration, Dr. White made clear that antiquities exported from Thailand generally require a permit from the Thai Fine Arts Department. But, remarkably, she only saw one or two samples of antiquities where a permit actually had been obtained despite the thousands of samples examined.

Dr. White also noted that most of the artifacts were found intact, indicating that they had been illegally dug-up. “Intact artifacts are rare in archaeological sites and tend to come from human burials,” which would require “large scale excavations.”

The prison term and felony convictions imposed by Judge Pregerson this week are hoped to decrease the incentive to industrially excavate overseas archaeological sites overseas and to deter smuggling of contraband cultural property into the American marketplace.

More details about the cases can be found on Jason Felch's Chasing Aphrodite blog and at Trafficking Culture.

Photo credits: William Schenold and Kiwiodyse

Text copyrighted 2015 by Cultural Heritage Lawyer, a blog commenting on matters of cultural property law, art law, cultural heritage policy, antiquities trafficking, and museum risk management. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of any blog post without the express written consent of CHL is prohibited. CHL is a service of Red Arch Cultural Heritage Law & Policy Research, Inc.

Fossil Smuggler Sentenced

Microraptor fossil recovered by ICE.

Fossil smuggling has been an area of law enforcement success for Homeland Security Investigations (HSI). The investigative arm of Immigration and Customs Enforcement (ICE) rarely generates heritage trafficking cases that lead to prosecutions. But court cases against Jun Yang, Eric Prokopi and John Richard Rolater have been noteworthy exceptions.

HSI's latest achievement is a plea deal concluded by the U.S. Attorney's Office in Wyoming with Charles Magovern of Boulder, Colorado, who was convicted of fossil smuggling.

Following the terms of the agreement, a federal district court last week sentenced Magovern to probation for illegally importing dinosaur specimens into the United States from China and Mongolia.

The felony information filed by Assistant United States Attorney Stuart Healy, III charged Magovern with willfully and knowingly importing paleontological material "by means of false statements and false papers, to wit, customs import declarations ... were false and fraudulent in that they did reflect as the purchase price of said merchandise a value which was less than the purchase price of said merchandise." Magovern, along with "fossil retailer" John Richard Rolater and another conspirator, "did knowingly aid and abet each other in the commission of this offense," the information further charged. The violations constituted offenses against 18 USC §§ 542 and 2.

ICE reported that the illegal imports were concealed "within legitimate cargo."

According to a press release issued by the agency, the smuggled objects included fossils dating as far back as 151 million years. They consisted of:

Anchiornis fossil recovered by ICE.

• a Chinese Sinovenator valued at approximately $70,000;
• an Anchiornis Huxley valued at approximately $100,000;
• a Protoceratops valued at approximately $250,000; and
• four Microraptors valued at approximately $38,000 to $45,000 each.

Part of the sentence included Magovern's agreement to forfeit "fossils already provided by the defendant" to ICE.

Magovern appears to have cooperated with authorities given his waiver of grand jury indictment, the quickness between the filing of the criminal complaint in July to the time of sentencing, and the actual terms of the sentence.

Photo credits: ICE

Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

Canadian Man Charged with Trafficking Dinosaur Fossils from China

U.S. District Court in Tucson, AZ.

A man has been arrested in Arizona for allegedly trying to sell dinosaur fossils imported from China to undercover federal agents. Jun Yang, a Canadian, faces criminal charges of archaeological smuggling and wildlife trafficking.

The charges, initiated by U.S. Homeland Security Investigations (HSI), likely will be challenged by defense lawyers because of legal irregularities.

Filed on Tuesday in federal district court (15-mj-07055), the complaint alleges that the defendant

did fraudulently and knowingly offer for sale and sell merchandise, namely one Psittacosaurus fossil and  approximately 15 Hadrosaur fossil eggs, after the merchandises' importation into the United States, knowing said merchandise had been imported into  the United States contrary to law; that is, ... Jun Yang knowingly sold said merchandise knowing that they are cultural property that had been imported into the United States from the People's Republic of China contrary to law, that is specially protected fossils are prohibited  from being sold to any foreigner or foreign organization, all in violation of Title  19, United  States Code  Section  2606(a) [the Cultural Property Implementation Act (CPIA)] and Title  18 United States Code Section 545 [the anti-smuggling law].
...
[and] did unlawfully and knowingly import in foreign commerce, transport, receive and acquire any wildlife, that is one Psittacosaurus fossil and approximately 15 Hadrosaur fossil eggs, knowing that said wildlife were taken, possessed, transported and sold in violation of the laws of the People's Republic of China. all in violation  of Title  16 United States Code. Sections 3372(a)(2)(A) and 3373(d)(l)(B) [the Lacey Act].

The CPIA, which is relied on by Count 1 in the charging document, is the federal statute that implements the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property. While the 1970 UNESCO Convention’s definition of "cultural property" includes "objects of palaeontological interest," the CPIA itself only applies to archaeological and ethnological objects. Palaeontolological material--like dinosaur fossils--are not archaeological or ethnological objects by definition. And while the U.S. has signed a bilateral agreement with China that restricts the import of designated Chinese archaeological and ethnological artifacts across America's borders, that agreement does not prohibit dinosaur fossils.

Count 2 relies on the Lacey Act, a federal law designed to protect wildlife and other natural resources. Under the terms of the statute, it is illegal to import or sell designated wildlife that is taken, possessed, or sold in violation of any law, treaty or regulation of the United States. But are dinosaur fossils wildlife? While the statutory definition of "wildlife" includes a dead wild animal or an egg, would either a dinosaur fossil or dinosaur eggs actually be considered "wildlife"?

The defendant's arrest is explained by the allegations contained in the criminal complaint:

On or about February l0, 2015, in Tucson in the District of Arizona, agents of the Department of Homeland Security acting in an undercover capacity walked through the display area at [a gem and mineral show] .... Agents spoke with Mr. Yang about an item displayed and advertised as a Psittacosaurus Fossil. Mr. Yang stated the fossil was 100 to 130 million years old and from the province Henan and was "dug up" in  central  China  approximately 200-300 kilometers south of Mongolia. Mr. Yang stated the price of the Psittacosaurus Fossil was $15,000.00 (United States Currency) and was not negotiable because of the quality of the fossil. Agents heard Mr. Yang  speak with  another  customer regarding egg fossils adjacent to the Psittacosaurus fossil. Mr. Yang identified the eggs as Chinese dinosaur egg fossils  and told  the agents they were Hadrosaur  Eggs, a "duck billed" dinosaur in  China. A sign on the dinosaur egg fossils display box stated "$450.00" for each egg. 

On or about February 10, 2015, agents posing as shoppers ... again spoke with Mr. Yang about the Psittacosaurus fossil .... Mr. Yang stated that he illegally removed the fossils from China, put the fossils in containers with stone carvings, shipped them to the United States and didn't disclose that fossils were in the containers to US Customs and Border Protection, only paying tax on the stone carvings. 

When asked, Mr. Yang said that the exportation of the Psittacosaurus fossil and the Hadrosaur Eggs were in violation of Chinese law. Mr. Yang stated this was only a violation of the laws of China, not US. Mr. Yang stated he has no documents for any of the fossils. Agents asked for permission to photograph the fossils, and Mr. Yang agreed. 

The pictures were later sent to a Subject Matter Expert (SME) who, based on the photographs taken by the agents confirmed the fossils are a Psittacosaurus fossil and Hadrosaur Eggs and were indigenous to certain regions of China. The SME stated that these fossils are of high scientific value. A review of the law of the Peoples Republic of China prohibits the sale of specially protected fossils to foreigners or foreign organizations. 

On or about February 14, 2015 an agent acting in an undercover (UC) capacity entered the Arctic Products Inc. display area posing as a shopper. The UC agent started the conversation with Mr. Yang about the Hadrosaur Eggs that were on display and inquired as to how many they would be able to purchase for five-thousand dollars (USD-$5000.00). Mr. Yang stated that the Hadrosaur Eggs are from China, that they were very rare and that he used to have a lot, but may not be able to get them anymore. Mr. Yang stated that he already sold one (1) Hadrosaur Egg for four hundred fifty (USD-$450.00) but stated he would sell thirteen (13) Hadrosaur Eggs at a discounted rate for five-thousand dollars (USD-$5000.00) to the UC agent. 

The UC agent then inquired about the Psittacosaurus fossil.... Mr. Yang explained to the UC agent that the Psittacosaurus fossil was approximately 130-100 millions years old and it was for sale for fifteen thousand dollars (USD-$15,000). Mr. Yang stated that all the stuff was from China. Mr. Yang stated that he has had the Psittacosaurus fossil for a few years and that it was from the North-Eastern part of China. When asked how he got the fossils out of China, Mr. Yang stated the fossils are put in containers with the stone carvings and "we do not declare, we declare it as stone."

An arrest is not a finding of guilt; it is simply a process that initiates a criminal court proceeding. The prosecution bears the burden to prove that a defendant is guilty beyond a reasonable doubt.

Photo source: U.S. DoJ

Text copyrighted 2015 by Cultural Heritage Lawyer. Blog url: culturalheritagelawyer.blogspot.com. Any unauthorized reproduction or retransmission of this post without the express written consent of CHL is prohibited. CHL is a project of Red Arch Cultural Heritage Law & Policy Research, Inc.

CPIA-Related Obstruction Case Concludes with Probation, a Fine, and Forfeiture of Chinese Cultural Objects

Sentencing of a Chinese artifacts dealer and his company for obstruction of justice took place last week in the Southern District of Florida. The U.S. Attorney in Miami commenced the prosecution when the defendants tried to thwart import restrictions authorized by the Convention on Cultural Property Implementation Act (CPIA).

In the cases of U.S. v. Francois B. Lorin and U.S. v. Lorin & Son, LLC, federal district court judge Jose E. Martinez fined Lorin & Son (doing business as Asiantiques) $25,000 plus an assessment of $400. He also placed the company's manager, Francois Lorin, on probation for a period of three years, imposing a special condition that he "shall provide complete access to financial information, including disclosure of all business and personal finances, to the U.S. Probation Officer."

Today, the court issued a further order forfeiting 22 Chinese objects seized from the defendants in 2011. The forfeiture is part of the plea agreement reached between the parties this past December.

Prosecutors say that the defendants supplied fake paperwork to U.S. Customs and Border Protection (CBP) in an effort to convince authorities that the Chinese artifacts arrived in the U.S. prior to the enactment of a bilateral agreement between the U.S. and China. That bilateral agreement, also known an MoU, was adopted in 2009 under authority of the CPIA. It restricts imports of designated archaeological materials from China unless specifically authorized. Import restrictions enacted under the U.S.-China MoU were renewed by the President last month.

If the defendants could show that the archaeological objects to be imported were located in the U.S. prior to January 14, 2009—the enactment date of the U.S.-China MoU—then the archaeological objects could be re-imported with little difficulty. So when the defendants offered fraudulently backdated customs paperwork to prove that the goods were in the U.S. as early as May 9, 2006, Miami's top federal prosecutor charged the defendants with obstruction under 18 U.S.C. § 1512(c)(2). The U.S. Attorney's office further alleged to the court that the defendants declared false values for the imports and failed to declare some others. Fuller details of the facts can be found here and here. 

When sentencing Francois Lorin, Judge Martinez agreed to depart downward from the federal sentencing guidelines, a move supported by both the government and the defense. That is to say that the court agreed with the parties' recommendation that a term of probation could be imposed on the 75 year old defendant without sending him to prison.

Today's court order describes the objects forfeited to the government as part of the plea deal reached with the government:

• Nephrite Jade “Bi” Disk composed of Three “Huang” from the Neolithic or Shang Dynasty.

• Nephrite jade “Bi” disk composed of three Huang from the late Shang or Western Zhou Dynasty.

• Pan Bronze Footed Tray with Two handles from the Archaic-Zhou Dynasty, first millennium BC.

• Nephrite Jade Insignia Blade from the Late Neolithic Period.

• Lion and Grapevine mirror with elaborate wood.

• Nephrite Jade “Bi” Disk from the Han Dynasty.

• Nephrite Jade “Bi” Disk from the Han Dynasty.

• Three-part Nephrite Jade “Bi” Disk from the Shang Dynasty.

• Gold and Silver Inlaid Bronze Cylindrical Lidded Container from the Late Zhou Dynasty.

• Nephrite Jade Phoenix from the Warring States Period.

• Nephrite Jade Bird hand piece from the Neolithic Period, possibly Hongshan culture.

• Nephrite Jade model of a pig from the Han Period.

• Nephrite Jade Falcon-type Bird from the Neolithic Period, said to be Hong Shan.

• Nephrite Jade “humanoid'' Figure from the Shang Dynasty.

• Nephrite Jade Three-pong Attachment from the Neolithic Period, perhaps Liangzhu Culture, 5th 6^th Millennium BC or Hongshan Culture, 5th-3rd Millennium BC.

• Nephrite Jade “Bi”' Form from the Warring States.

• Nephrite Jade Fish Toggle from the Neolithic Period.

• Bronze and Nephrite Jade Lidded Container (“Lian'') from the Han Dynasty, Early Western Han, Xang.

• Archaic, yellow jade blade from the Han Dynasty or earlier.

• Bronze mirror with fish and birds from the Tang Dynasty.

• Four Chinese Bronze weapons or articles of adornment from an undetermined Period, possibly Qin-Han Period. Pre-907 AD.

• Bronze mirror with fish and birds from the Tang Dynasty.

Photo credit: Jason Morrison

This post is researched, written, and published on the blog Cultural Heritage Lawyer Rick St. Hilaire at culturalheritagelawyer.blogspot.com. Text copyrighted 2010-2014 by Ricardo A. St. Hilaire, Attorney & Counselor at Law, PLLC. Any unauthorized reproduction or retransmission of this post is prohibited. CONTACT INFORMATION: www.culturalheritagelawyer.com

Bilateral Agreements Adopted Covering Bulgarian and Chinese Heritage in Jeopardy

"[P]romoting U.S. leadership in achieving greater international cooperation towards preserving cultural treasures that not only are of importance to the nations whence they originate, but also to a greater international understanding of our common heritage."

That is the focus of the Convention on Cultural Property Implementation Act (CPIA) according to the 1982 U.S. Senate Report describing the implementation of the 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export, and Transfer of Ownership of Cultural Property.

This week marked the adoption of a bilateral agreement with Bulgaria and the renewal of an agreement with China under the CPIA. These agreements, or Memoranda of Understanding (MoU) as they are called, create American import restrictions that hope to curb what the Senate Report calls "the demand for cultural artifacts [that] has resulted in the irremedial destruction of archaeological sites and articles, depriving the situs countries of their cultural patrimony and the world of important knowledge of its past."

Today's Federal Register reports that the State Department's Assistant Secretary for Educational and Cultural Affairs on November 20, 2012 determined under the CPIA, 

"That the cultural patrimony of Bulgaria is in jeopardy from the pillage of (a) archaeological material representing Bulgaria's cultural heritage (a) archaeological material representing Bulgaria's cultural heritage dating from the Neolithic period (7500 B.C.) through approximately 1750 A. D. and (b) ecclesiastical ethnological material representing Bulgaria's Middle Ages (681 A.D.) through approximately 1750 A.D. (19 U.S.C. 2602(a)(1)(A)); (2) that the Bulgarian government has taken measures consistent with the Convention to protect its cultural patrimony (19 U.S.C. 2602(a)(1)(B)); (3) that import restrictions imposed by the United States would be of substantial benefit in deterring a serious situation of pillage, and remedies less drastic are not available (19 U.S.C. 2602(a)(1)(C)); and (4) that the application of import restrictions as set forth in this final rule is consistent with the general interests of the international community in the interchange of cultural property among nations for scientific, cultural, and educational purposes (19 U.S.C. 2602(a)(1)(D)).

The State Department's decision follows a public hearing held by the Cultural Property Advisory Committee (CPAC) in November 2011.

Monday's Federal Register, meanwhile, chronicles the renewal of the bilateral agreement with China for another five years, saying "The Assistant Secretary for Educational and Cultural Affairs, United States Department of State, has determined that conditions continue to warrant the imposition of import restrictions on the archaeological materials from China."

The renewal includes a so-called Article II agreement that calls on the Chinese government to fulfill certain obligations. For example, the agreement responds to concerns about Chinese loans to U.S. museums--an issue specifically raised by the Minneapolis Institute of Art, which requested quicker finalization of contracts and object lists, faster processing of passports, assistance with fulfilling the requirements for indemnity insurance, decreased premium shipping charges by China Air, a more simplified loan approval process, lengthened exhibition tour times, and increased availability of First Grade objects. The Article II agreement responds, in part, with these terms::

The Government of the United States of America recognizes that the Government of the People's Republic of China permits the international interchange of archaeological materials for cultural, educational and scientific purposes to enable widespread public appreciation of and legal access to China's rich cultural heritage. The Government of the People's Republic of China agrees to use its best efforts to further such interchange by ...  facilitating the approval of loan exhibitions to the United States of America, allowing objects in an exhibition to remain outside China for up to two years, increasing the number of Grade 1 objects allowed in an exhibition; and considering longer-term loans of up to five years of a limited number of objects.

In addition to collaboration, Article II calls for improved law enforcement, saying that the Chinese government "shall increase joint efforts with the Hong Kong Special Administrative Region and the Macao Special Administrative Region to stop archaeological material looted or stolen from the Chinese mainland from being trafficked into and out of these regions" and "shall seek to further implement regulation of its internal market for antiquities, with the aim of reducing unauthorized transactions."

Information sharing is also covered by Article II, which mandates that China "shall provide annually to the Government of the United States of America information and statistics about crimes of theft, clandestine excavation, trafficking (illicit trade and smuggling) and abuse of official power, and, as it becomes available, information about prosecutions and convictions pertinent to the MOU."

The public hearing on the U.S.-China renewal took place in May 2013. Public comments were submitted to CPAC both for and against.

A source of controversy surrounding both the Bulgarian and Chinese MoUs is the inclusion of designated ancient coins among protected the cultural objects subject to American import controls. But the adoption of this week's agreements reconfirms that ancient coins are considered archaeological material by the terms of 19 U.S.C. § 2601 of the CPIA.

Cultural objects covered by the bilateral agreements may legally pass through America's borders when they are accompanied by either an export permit or proof showing that they left the countries of origin prior to the effective dates of the restrictions. Cultural materials protected by CPIA's import controls may be detained, seized, and forfeited by U.S. authorities as contraband. Smugglers may face potential prosecution under criminal statutes.

This post was revised at 8:15 p.m. on January 16, 2014. Photo credit: shho

This post is researched, written, and published on the blog Cultural Heritage Lawyer Rick St. Hilaire at culturalheritagelawyer.blogspot.com. Text copyrighted 2010-2014 by Ricardo A. St. Hilaire, Attorney & Counselor at Law, PLLC. Any unauthorized reproduction or retransmission of this post is prohibited.  CONTACT INFORMATION: www.culturalheritagelawyer.com