Steve Rosen Accuses AIPAC of Espionage

by , September 02, 2009

Steven J. Rosen’s defamation lawsuit against the American Israel Public Affairs Committee (AIPAC) is now entering a critical phase. A series of cross-filings stakes out the critical court terrain. Rosen intends to show that obtaining and leveraging classified U.S. government information in the service of Israel is common practice at AIPAC. He claims it was unfair for AIPAC to fire and malign him in the press after he was indicted on espionage charges in 2005. AIPAC’s defense team is committed to getting the case thrown out on technicalities before it goes to trial early next year.

On March 2, 2009, Rosen filed the civil lawsuit against his former employer, directors, and an outside public relations firm for libel and slander. Rosen, AIPAC’s former foreign policy chief, seeks $5 million in damages from AIPAC, and punitive damages of $500,000 from each former board member, for a total claim of $21 million. AIPAC made statements to the news media Rosen believes were "knowingly false and defamatory and issued in reckless disregard." AIPAC fired Rosen and fellow employee Keith Weissman after they were criminally indicted under the 1917 Espionage Act in 2005. Both were caught up in an FBI sting operation receiving classified information from Department of Defense employee Col. Lawrence Franklin, who pled guilty and turned state’s witness. After years of pretrial maneuvers during which presiding Judge T.S. Ellis steadily raised the standards for conviction, U.S. government prosecutors reluctantly dropped [.pdf] their case in May 2009.

AIPAC’s spokesman told the New York Times in April 2005 that Rosen’s actions differed from "the conduct that AIPAC expects from its employees." On July 7, 2005, the spokesperson told the New Yorker that "Rosen [and his colleagues] were dismissed because they engaged in conduct that was not part of their jobs and because this conduct did not comport with the standards that AIPAC expects and requires of its employees." Rosen’s legal counsel David H. Shapiro gruffly advised AIPAC’s attorney Thomas L. McCally that he would be seeking "serious discovery" on Rosen’s behalf during a status hearing on June 5, 2009. It is this sort of public intrusion guided by knowledgeable insiders, following already devastating FBI raids, that AIPAC probably wants to avoid at all costs.

Ironically, Rosen’s civil lawsuit, like the failed government prosecution, hinges on proving that circulating classified information is common practice inside AIPAC. AIPAC’s counsel originally filed an immediate motion to dismiss [.pdf] on May 13, 2009, asserting that Rosen failed to show "factual allegations" that could be considered in any way defamatory. McCally also took Rosen to task for filing outside the one-year statute of limitations for defamation and suing AIPAC board members who have various immunities under District of Columbia statutes. In a July 8, 2009, rebuttal [.pdf], Rosen states his clear belief that the most relevant issue was AIPAC dumping two employees to save itself from being criminally indicted as a corporation.

“On February 17, 2005, only two weeks after awarding Mr. Rosen the $7,000 special bonus for excellence in job performance, the AIPAC Board of Directors placed him on involuntary leave. This was done immediately after AIPAC was threatened by the Justice Department in a meeting between AIPAC’s counsel and its Executive Director Howard Khor and federal prosecutors on February 15, 2005. There the lead federal prosecutor stated that, ‘We could make real progress and get AIPAC out from under all of this,’ if AIPAC showed more cooperation with the government. On February 16, 2005, AIPAC’s counsel said that the lead federal prosecutor ‘is fighting with the FBI to limit the investigation to Steve Rosen and Keith Weissman and to avoid expanding it.’ This warning implied that AIPAC’s Executive Director and the AIPAC organization as a whole could become targets.”

Rosen’s lengthy – even rambling – rebuttal argues “no expressed standards existed at AIPAC” regarding the receipt and sharing of information from government officials. Rosen insists that in spite of AIPAC denials the information he provided from “intelligence” sources were passed to AIPAC’s president with full disclosure of their origins.

In an Aug. 7, 2009, court filing, AIPAC fired back claiming Rosen “has misdirected his anger” by suing AIPAC rather than the “government agency that directly investigated him and indicted him for purported criminal activities.” AIPAC claims Rosen failed to demonstrate AIPAC’s intent to defame under the higher standards established for public figures like Rosen. “Malice is only required for public and limited purpose public figures to establish a defamation suit. Even with the heightened standard required of public figures, Plaintiff has not shown any….” AIPAC added insult to injury, claiming that “by any objective or subjective measure, being subject of a criminal indictment is not conduct an employer expects of any employee.”

Rosen returned fire on Aug. 24, 2009, claiming ample legal precedents for allowing aggrieved parties to file lawsuits outside normal statutes of limitations for extenuating circumstances – in this case Rosen’s criminal indictment and drawn-out pretrial maneuvers. Echoing the June 5, 2009, courtroom showdown threats, Rosen repeats he “will be in a position to prove his allegations with evidence following discovery.”

Rosen’s quest for elusive justice is oddly parallel to that of his former government prosecutors. They only wanted to prove the straightforward results of an FBI sting operation, during which Rosen both received and transmitted classified national defense information. The FBI and DOJ never expected a media circus, ongoing accusations of anti-Semitism, claims that U.S. and Israeli foreign policies are “the same,” and speculation that their entire prosecution was covert attempt to overturn the 1st Amendment.

Rosen and former AIPAC chief lobbyist Doug Bloomfield have threatened to prove that AIPAC regularly dabbles in classified information-trading and sometimes even functions as a foreign agent – at least up until the moment of a confidential out-of-court financial settlement. If the court lets Rosen proceed to discovery, proving these contentions shouldn’t be very difficult. Bloomfield worked at AIPAC around the time it was circulating a classified government report outlining the U.S. Trade Representative’s secret negotiating position for the U.S.-Israel Free Trade Area. With such inside information about precisely where the skeletons are buried, the duo should have no problem revealing AIPAC to the world as a hotbed of espionage and covert action. Broadcasting Rosen’s unsavory activities to the world under such circumstances probably was defamation.

Thrashing AIPAC in court is not something Rosen and Bloomfield, as lifelong Israel lobbyists, would do gladly, but in their eyes the lobby’s principle of reciprocity and motto of “divided we fall” has been badly battered by AIPAC’s mistreatment of its former operatives. Telling Rosen that he can’t recover due compensation just because his civil lawsuit was filed too late will surely seem a travesty of justice to the hard core of the lobby. Americans, on the other hand, must continue to wait for the day that the DOJ finally begins enforcing sensible laws still on the books such as the Foreign Agents Registration Act, the Logan Act, the Commercial Espionage Act, and others that create foreign lobby accountability, improve policymaking, and preserve American industrial innovation. The only current relief from AIPAC’s onslaught against America may be that family legal troubles could delay its slow march to entangle the U.S. military in an ill-advised and costly attack on Israel’s archnemesis, Iran.

Read more by Grant Smith