CINDY A. COHN, ESQ.; SBN 145997
McGLASHAN & SARRAIL
Professional Corporation
177 Bovet Road, Sixth Floor
San Mateo, CA 94402
Tel: (415) 341-2585
Fax: (415) 341-1395

LEE TIEN, ESQ.; SBN 148216
1452 Curtis Street
Berkeley, CA 94702
Tel: (510) 525-0817

M. EDWARD ROSS, ESQ.; SBN 173048
STEEFEL, LEVITT & WEISS
A Professional Corporation
One Embarcadero Center, 30th Floor
San Francisco, CA 94111
Tel: (415) 788-0900

JAMES WHEATON, ESQ.; SBN 115230
ELIZABETH PRITZKER, ESQ.; SBN 146267
FIRST AMENDMENT PROJECT
1736 Franklin, 8th Floor
Oakland, CA 94612
Tel: (510) 208-7744

Attorneys for Plaintiff
Daniel J. Bernstein

                     IN THE UNITED STATES DISTRICT COURT

                   FOR THE NORTHERN DISTRICT OF CALIFORNIA

DANIEL J. BERNSTEIN		)
				) C 95-00582 MHP
	Plaintiff,		)
				) PLAINTIFF'S OPPOSITION TO
		v.		) DEFENDANT'S MOTION FOR
				) SUMMARY JUDGMENT
				)
UNITED STATES DEPARTMENT OF	) Date: September 20, 1996
STATE et al.,			) Time: 12:00
				) Judge: Hon. Marilyn Hall Patel
	Defendants.		)
				)
________________________________)

                              TABLE OF CONTENTS

INTRODUCTION 1

STATEMENT OF FACTS 1

Defendants Did Extend ITAR Scheme Jurisdiction Over
Plaintiff's Scientific Paper and Instructions 1

Defendants' Assertions Concerning the Public Domain
Exception Are Demonstrably False 2

Defendants' Do Control Algorithms 3

I. ITAR SCHEME IS A PRIOR RESTRAINT 4

A. Defendants Applied The ITAR As A Prior Restraint
on the Publication of Plaintiff's Source Code, Paper and
Technical Data 5

1. Defendants Cannot Rewrite History: They Did
Apply the ITAR Licensing Scheme to Plaintiff's
Academic Paper and Instructions 6

B. The Technical Data Provisions of the ITAR, On Their Face,
Regulate Scientific and Academic Publication and Exchange 8

C. The Technical Data Provisions of the ITAR, As Applied, Regulate
Scientific and Academic Publication and Exchange 9

1. The Public Domain Exception Does Not Function
To Prevent Academic and Scientific Censorship 10

2. Defendants' Assertion That The ITAR Has No Impact On
Scientific and Academic Development of Cryptography Is
Demonstrably False 11

D. ITAR Restrictions on Cryptographic Source Code Regulate
Scientific Publication and Academic Exchanges 12

E. Neither Edler Nor Defendants' Post Edler Amendments to the
ITAR Scheme Eliminates Plaintiff's First Amendments Challenge
To The Technical Data Provisions of the Current ITAR 12

F. The Prior Restraint Created by the ITAR Scheme Does Not Pass
Constitutional Muster and Must Be Invalidated 13

II. THE ITAR SCHEME IS PRESUMPTIVELY INVALID AS A
CONTENT-BASED RESTRAINT ON PROTECTED SPEECH 14

A. The Export Controls on Cryptographic Software
Are Content-Discriminatory on Their Face 15

B. Regulation of Cryptographic Software Because It Functions To Encrypt
Is Content-Based Regulation 17

C. Because The ITAR's Export Controls Implicate Speech Alone,
The First Amendment Demands Strict Scrutiny 19

D. The ITAR's Export Controls Are Facially Invalid
Even If Viewed as Content-Neutral 20

1. The ITAR Scheme Cannot Survive The Intermediate Level Of
Scrutiny Required By United States v. O'Brien 20

2. The ITAR Scheme Is An Unconstitutional Ban On A
Particular Mode of Expression 21
III. THE ITAR SCHEME IS OVERBROAD ON ITS FACE AND AS APPLIED 22

A. The Court May Properly Consider and Grant Plaintiff's
Facial Challenge 22

B. The Challenged Provisions Are Substantially Overbroad 25

1. The ITAR Scheme Restricts Speech That Poses No Harm
To Government Interests 26

2. The Exemptions Do Not Eliminate Overbreadth 27

IV. THE ITAR SCHEME IS UNCONSTITUTIONALLY VAGUE 27

A. The ITAR's Labels Are Vague 28

B. Defendants' Focus On The Clarity of Their Exemptions Is Misplaced 29

1. The "Public Domain" Exemption Is Vague 30

2. The Academic Exemption Is Vague 31

C. The ITAR Scheme Lacks The Necessary Scienter For Civil and
Criminal Liability 33

V. WITHOUT FURTHER SAVING CONSTRUCTION, THE ITAR SCHEME
IS EITHER ULTRA VIRES OR AN UNCONSTITUTIONAL DELEGATION
OF LEGISLATIVE POWER 35

A. The ITAR Scheme Is Ultra Vires 36

1. Commercial Transactions: The Core Meaning of the AECA 36

2. AECA Does Not Apply to Domestic Speech 38

3. AECA Does Not Apply to General Publication 39

B. AS INTERPRETED BY DEFENDANTS, THE SCHEME VIOLATES
THE NON-DELEGATION DOCTRINE 40

CONCLUSION 41

                            TABLE OF AUTHORITIES

CASES

A.L.A. Schechter Poultry Corp. v. United States, 295 U.S. 495 (1935) 40
ACLU v. Reno, 1996 WL 311865 (E.D. Pa., June 11, 1996) 22
Baggett v. Bullitt, 377 U.S. 360 (1964) 30,33
Bantam Books v. Sullivan, 372 U.S. 58 (1963) 11
Bd. of Airport Comm'rs of Los Angeles v. Jews for Jesus, Inc., 482 U.S. 569
(1987) 23
Bd. of Trustees of State University of New York v. Fox, 492 U.S. 469 (1989)
24
Bernstein v. Department of State, 922 Fed.Supp. 1426 (N.D. Cal., 1996).
1,17,18
Blount v. Rizzi, 400 U.S. 410 (1971) 6
Boos v. Berry, 485 U.S. 312 (1988) 19
Bowen v. Georgetown Univ. Hosp., 488 U.S. 204 (1988) 3
Brandenberg v. Ohio, 395 U.S. 444 (1969) 14
Brockett v. Spokane Arcades, Inc., 472 U.S. 491 (1985) 23
Buckley v. Valeo, 424 U.S. 1 (1976) 27
Bullfrog Films, Inc. v. Wick, 847 F.2d 502 (9th Cir.1988) 16,27
Canton R.R. Co. v. Rogan, 340 U.S. 511(1951) 38
Cantwell v. Connecticut, 310 U.S. 296 (1940) 16
Chevron U.S.A. v. Natural Resources Defense Council, Inc., 467 U.S. 837
(1984) 3,39
City of Cincinnati v. Discovery Network, Inc., 507 U.S. 410 (1993) 15
City of Houston v. Hill, 482 U.S. 451 (1987) 23,25
City of Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283 (1982) 6,7
City of Lakewood v. Plain Dealer Publishing Co., 486 U.S.750 (1988)
4,10,12,23,39
City of Ladue v. Gillieo, 512 U.S. 43 (1994) 21,22
Cohen v. California, 403 U.S. 15 (1971). 12
Community For Creative Non-Violence v. Turner, 893 F.2d 1387 (D.C. Cir.
1990) 20,21
Edward J. DeBartolo Corp. v. Florida Gulf Coast Building & Construction
Trades Council,
485 U.S. 568 (1988) 39
First National Bank of Boston v. Bellotti, 425 U.S. 765 (1978) 16
Forsyth County v. Nationalist Movement, 505 U.S. 123 (1992). 23,27
Freedman v. Maryland, 301 U.S. 51 (1965) 5,6,13,42
FW/PBS, Inc. v. City of Dallas, 493 U.S. 215 (1990) 6
Gaudiya Vaishnava Society v. City of San Francisco, 952 F.2d 1059 (9th Cir.
1990) 21
Gorin v. United States, 312 U.S. 19 (1941) 34,35
Grayned v. City of Rockford, 408 U.S. 104 (1972) 28,30
Greene v. McElroy, 360 U.S. 474 (1959) 39
Grossman v. City of Portland, 33 F.2d 1200 (9th Cir. 1994) 20,26
Gustafson v. Alloyd Co., Inc., 115 S. Ct. 1061 (1995) 36
Hurley v. Irish-American Gay, Lesbian & Bisexual Group of Boston,
115 S.Ct. 2347 (1995) 12
Interstate Circuit v. City of Dallas, 390 U.S. 676 (1968) 28
Jamison v. Texas, 318 U.S. 413 (1943) 21
Joseph Burstyn, Inc. v. Wilson, 343 U.S. 495 (1952) 22
K-Mart v. Cartier, Inc., 486 U.S. 281 (1988) 36
Karn v. U.S. Department of State, 925 F.Supp. 1 (D.D.C. 1996) 29
Keyishian v. Bd. of Regents, 385 U.S. 589 (1987) 33
Kolender v. Lawson, 461 U.S. 352 (1983) 27
Lind v. Grimmer, 30 F.3d 1115 (9th Cir. 1994) 23
Local 74, United Brotherhood of Carpenters v. NLRB, 341 U.S. 707 (1951). 7
Lovell v. City of Griffin, 303 U.S. 444(1938). 21,39
Luckie v. E.P.A., 752 F.2d 454 (9th Cir. 1985). 6,7,8
Members of the City Council of Los Angeles v. Taxpayers for Vincent,
466 U.S. 789(1984). 22,25
Mishkin v. New York, 383 U.S. 502 (1966) 33
Mutual Film Corp. v. Industrial Comm'n of Ohio, 236 U.S. 230 (1915) 22
NAACP v. Button,371 U.S. 415 (1963) 19,27
Near v. Minnesota ex rel Olson, 283 U.S. 697 (1931) 13,15
New York Times Co. v. Sullivan, 376 U.S. 255 (1964) 33
New York Times Co. v. United States , 403 U.S. 713 (1971) 4,13,14
Panama Ref. Co. v. Ryan, 293 U.S. 388 (1935). 40
Police Department of Chicago v. Mosley, 408 U.S. 92(1972). 15
Ratzlaf v. United States, 510 U.S. 135 (1994) 35
Renne v. Geary, 501 U.S. 312 (1991) 23
Rosen v. Port of Portland, 641, F.2d 1243 (9th Cir. 1981) 26
Rust v. Sullivan, 500 U.S. 173 (1991) 40
Schenk v. United States, 249 U.S. 47 (1919) 13
Schneider v. Smith, 390 U.S. 17 (1968) 39
Schnieder v. State, 308 U.S. 147 (1939). 21
Sec'y of State of Maryland v. Joseph H. Munson Co., 467 U.S. 947 (1984) 22
Securities Indus. Ass'n v. Bd. of Governors of the Fed. Reserve Sys. 468
U.S. 137 (1984) . . 3
Simon & Schuster, Inc. v. N.Y. Crime Victims Bd., 502 U.S. 105 (1991). 15
Southeastern Promotions Ltd., v. Conrad, 420 U.S. 546 (1975) 5
Speiser v. Randall, 357 U.S. 513 (1958) 30
Staub v. City of Baxley, 355 U.S. 313 (1958) 4
Talley v. California , 362 U.S. 60 (1960) 26
Thornhill v. Alabama, 310 U.S. 88 (1940). 12
Thomas v. Collins, 323 U.S. 516 (1944) 26
Touby v. United States, 500 U.S. 160 (1991) 40
United States v. Adames, 878 F.2d 1374 (11th Cir. 1989) 30
United States v. Albertini, 472 U.S. 675 (1985). 20
United States v. Beck, 615 F.2d 441(7th Cir. 1980) 34,38
United States v. Durrani, 835 F.2d 410(2nd Cir. 1987) 38
United States v. Edler Industries, Inc., 579 F.2d 516 (9th Cir. 1978).
10,12,13,18,31,34,38,39
United States v. Evans, 667 F.Supp. 974 (S.D.N.Y. 1987) 38
United States v. Gurrola-Garcia, 547 F.2d 1075 (9th Cir. 1976) 38
United States v. Heine, 151 F.2d 813 (2nd Cir. 1945) 34
United States v. Mendoza-Lopez, 107 S.Ct. 2146 (1987) 41
United States v. Murphy, 852 F.2d 1 (1st Cir. 1988) 34
United States v. Nordic Village, Inc., 503 U.S. 30 (1992) . 36
United States v. National Treasury Employees Union, 115 S.Ct. 1003 26, 27
United States v. O'Brien, 391 U.S. 367 (1968). 14,20,21
United States v. Posey, 864 F.2d 1487 (9th Cir. 1989) 31,38
United States v. Progressive, Inc. 467 F.Supp. 990 (W.D. Wis., 1979) 13
United States v. Robel, 389 U.S. 258 (1967) 40
United States v. Thirty-Seven (37) Photographs, 402 U.S. 363 (1971) 6
United States v. Trans-Missouri Freight Ass'n, 166 U.S. 290 (1897) 7
United States v. Tsai, 954 F.2d 155 (3rd Cir. 1992) 34
United States v. W.T. Grant Co., 345 U.S. 629 (1953). 6
United States v. X-citement Video, 115 S.Ct. 464 (1994). 34,35
Village of Hoffman Estates v. Flipside, 455 U.S. 489(1982) 27,28
Virginia v. American Booksellers Ass'n, Inc. 484 U.S. 383 (1988) 23,28
Ward v. Rock Against Racism, 491 U.S. 781 (1989). 20
Walters v. Churchill, 114 S.Ct. 1887 (1994) 19
Yakus v. United States, 321 U.S. 414 (1944). 40
Yniguez v. Arizonans for Official English, 69 F.3d 920 (9th Cir. 1995) 19,23

STATUTES

15 C.F.R. 799.3(a)(1) 30
22 C.F.R. 120.4(a) 28
22 C.F.R. 120.4(d)(2) 29
22 C.F.R. 120.10(a)(1) 29
22 C.F.R. 120.10(a)(4) 15
22 C.F.R. 120.10(a)(5) 8
22 C.F.R. 120.11 30
22 C.F.R. 120.11(a)(1),(2),(3),(4) 8
22 C.F.R. 120.11(a)(6),(8) 8
22 C.F.R. 120.17(a)(1). 18
22 C.F.R. 120.17(a)(4) 16,18,24,39
22 C.F.R. 120.17(a)(5) 16
22 C.F.R. 121.8(f) 3,5,15,24,29
22 C.F.R. 122.1(c) 26
22 C.F.R. 122.5(a) 26
22 C.F.R. 125.1(a) 29,30,31
22 C.F.R. 126.7(a) 7
22 C.F.R. 126.9 7,28
22 U.S.C. 1934(a) 35
22 U.S.C. 2778 33,35,36
22 U.S.C. 2778(a)(1) 35
22 U.S.C. 2778(a)(1)(C)(5) 24
22 U.S.C. 2778(b)(1)(A) 36
22 U.S.C. 2778(c) 33
22 U.S.C. 2778(e) 33
22 U.S.C. 2778(g)(1)(C)(5). 16
22 U.S.C. 2778(g)(2) 36
22 U.S.C. 2778(g)(9)(D) 36
22 U.S.C. 2778(h) 3,8,13,27,28,35,40
22 U.S.C. 2794(7) 35,36,40
50 U.S.C. 2415(5)(C) 33

				INTRODUCTION

In seeking summary judgment, Defendants again unabashedly seek to
rewrite history, ignore facts, and unilaterally eliminate issues in
this case. In the end, however, they fail to meet their burden to prove
that there is no genuine issue of material fact that the Arms Export
Control Act and International Traffic in Arms Regulations (hereinafter
"ITAR Scheme"), as applied to protected expression, is constitutional.
Instead, it becomes even more obvious that the ITAR Scheme improperly
grants wide, unfettered discretion to Defendants. Because they have not
justified this prior restraint -- which bears a heavy presumption
against validity -- Defendants' Motion must be denied and Plaintiff's
Motion for Partial Summary Judgment should be granted.

			     STATEMENT OF FACTS

Defendants' arguments rest on several false or disputed factual
assertions.  Each of these assertions, repeated throughout their Brief
and the attached Declarations, is intended to draw attention from
Defendants' regulations and administrative actions and focus instead on
their post-litigation, attorney-drafted actions and assertions of their
policies. As each is disproved or disputed, undue discretion is
demonstrated, and the foundation for Defendants' arguments crumbles.
With it their entire case must fall.

       Defendants Did Extend ITAR Scheme Jurisdiction Over Plaintiff's
		     Scientific Paper and Instructions.

Defendants falsely assert that they never extended the ITAR Scheme to
PROF.  BERNSTEIN's Scientific Paper and Instructions. Memorandum of
Points and Authorities In Support of Defendants' Motion for Summary
Judgment at 4:6-16, 5:24-29, 6:8-9; (hereinafter "Defs' Mem"). These
assertions are false and should be disregarded. This Court found: "On
October 5, 1993 the OTDC notified Bernstein that all of the referenced
items were defense articles under Category XIII(b)(1)." Bernstein v.
Department of State, 922 F.Supp.  1426, 1430 (N.D.. Cal. 1996)
(emphasis in original). The Court specifically discussed Plaintiff's
Paper, noting: "[P]laintiff had every reason to believe his paper had
been determined to be a defense article until defendants' clarifying
letter of June 29, 1995." Bernstein, 922 F. Supp. at 1437, fn. 19.
(emphasis added). That Defendants designated the Paper as a defense
article for over three years and the Instructions as a defense article
for nearly two years, and only withdrew these designations after they
were sued, only demonstrates the breadth of Defendants' discretion.

      Defendants Assertions Concerning the Public Domain Exception Are
			     Demonstrably False

Defendants' also falsely assert that they do not ever "substitute their
judgment" about what may be in the public domain or "seek to control
the various means by which information is placed in the public domain."
Defs' Mem at 7:3-9:3, 8:4-5; 11:20-21; see also Defendants' July 25,
1996 letter, attached as Exhibit 24 to Declaration of William P.
Crowell ("Defendants' July 25, 1996 letter"). In his CJ Requests,
Plaintiff clearly stated: "I would like to publish these items in a
widely read international electronic conference known as 'sci.crypt'
for discussion by the worldwide academic community." Bernstein Decl.,
Exhibits A and G. Defendants did presume to control Plaintiff's
placement of these materials into public domain: they informed him that
a license was required.

More importantly, the pre-litigation statements of Mr. Charles Ray
directly refute Defendants' assertions here. Mr. Ray told PROF.
BERNSTEIN that Defendants did view their role as including the
censorship of information and that someone who published information or
placed it into a library where "anyone could get it" risked
prosecution. Further, when asked, Mr. Ray could not even name a single
piece of information which was in the public domain.  Bernstein Decl.
paras. 27-31.

Plaintiff has presented Declarations from himself, Professor Junger
(paras. 18-28), Dr. Blaze (paras. 12-15), Mr. Schneier (para. 27), Mr.
Johnson (paras. 22-33), Mr. Behlendorf (paras. 4-11) and Mr. Miller
(paras. 27-45) attesting to the actual impact of the ITAR Scheme on
information which scientists and academics seek to place into the
public domain. He has also presented evidence of this impact from the
Justice Department's Office of Legal Counsel ("OLC"), from Congress,
and from the National Research Council as recently as a few months ago.
It cannot credibly be disputed that the ITAR Scheme, on its face and as
applied, controls publication through its administration of these
exemptions. Defendants present only conclusory assertions, not facts.

When agency pre-litigation actions and statements to the affected
public are directly at odds with their post-litigation,
attorney-drafted, nonbinding assertions, both common sense and settled
law require that the actual actions and statements of the agency,
rather than their belated assertions, serve as the basis for judicial
evaluation. Thus, Defendants' protests that they do not presume to
determine what may be placed into the public domain or how it may be
placed there must be disregarded.

		     Defendants' Do Control Algorithms.

Defendants do not deny that the ITAR Scheme plainly includes algorithms
in its definition of software and so makes them defense articles
requiring pre-publication licensing. 22 C.F.R. 121.8(f). Instead,
Defendants assert that they never actually apply this portion of the
regulation. Defs. Mem.  31:8-25. This assertion is obviously specious;
it is directly refuted by Defendants' letters to PROF. BERNSTEIN. In
response to Plaintiff's first CJ Request, he was told that the reason a
license was required for his items was: "this commodity is a
stand-alone cryptographic algorithm which is not incorporated into a
finished software product." Bernstein Decl, Exhibit B.  Defendants'
statements that they do not apply their regulations to algorithms
should be disregarded.

I. ITAR SCHEME IS A PRIOR RESTRAINT.

A prior restraint exists when a licensing scheme has a "close enough
nexus to expression, or to conduct commonly associated with expression,
to pose a real and substantial threat of the identified censorship
risks," City of Lakewood v. Plain Dealer Publishing Co., 486 U.S. 750,
759 (1988) (scheme required an annual license for placement of
newsracks on public property).  Here, even the OLC agrees that ITAR
Scheme licensing "as a prerequisite to 'exports' of cryptographic
information clearly raises First Amendment questions of prior
restraint." Tien Decl., Exh. A, Bates stamp #60078.

The ITAR Scheme is unequivocally a prior restraint on speech about
cryptography, including cryptographic source code, since it requires a
license prior to publication of these forms of expression. See Staub v.
City of Baxley, 355 U.S. 313, 322 (1958); see also Plaintiff's
Memorandum of Points and Authorities in Support of his Motion for
Partial Summary Judgment and/or Summary Adjudication of Issues at
15:8-19:3. ("Plaintiff's Motion") Defendants, therefore, must overcome
the "heavy presumption against Constitutional validity" of such
restraints. New York Times Co. v. United States, 403 U.S. 713, 714
(1971) (quotation and citations omitted)("Pentagon Papers"). As in
Pentagon Papers, Defendants have here failed to demonstrate that
publication of speech about cryptography "will surely result in direct,
immediate and irreparable damage to our Nation or its people." Id. at
730 (Stewart, J. concurring). See Plaintiff's Motion at 15:8-21:20.
Since Defendants have failed entirely in their burden here, the ITAR
Scheme must be invalidated.

A. Defendants Applied The ITAR as a Prior Restraint on the Publication
of Plaintiff's Source Code, Paper and Technical Data.

Defendants virtually ignore the key prior restraint in the ITAR Scheme
created by requiring an arms export license for "software." These
provisions restrain two types of speech: computer source code and the
non-code speech items listed as part of the definition of software,
including "system functional design, logic flow, algorithms, . . ." 22
C.F.R. 121.8(f).

First, as to source code, Defendants admit that "[t]here is no dispute
that the State Department requires a license to export Snuffle (and
other cryptographic software)." Defs' Mem at 14. Likewise, they
acknowledge "that source code can be speech for First Amendment
purposes." Ibid. One of the most important issues in this case is the
question of whether Defendants may legitimately require a license prior
to the publication of protected expression in the form of source code.
Instead of directly addressing the question, however, Defendants
attempt to avoid it, not even mentioning it in their section devoted to
prior restraints. Defendants' entire discussion of the subject is one
sentence in their separate section devoted to content neutrality: "[I]f
export controls on source code do not impermissibly restrict the
content of protected speech, they are not a prior restraint or
otherwise in violation of the First Amendment." Defs' Mem at 14:10-13.

This assertion is flatly wrong. Even a speech licensing scheme which is
content neutral is still a prior restraint if it "presents a danger of
unduly suppressing protected expression." Freedman v. Maryland, 380 US
51, 54, 56-57 (1965) (discretion with respect to timing is excessive).
Where procedural safeguards are lacking, the Court need not even
consider the substantive standard used by officials. Southeastern
Promotions, Ltd. v.  Conrad, 420 U.S. 546, 562 (1975). The existence of
such discretion and the lack of procedural safeguards, without more,
violates the First Amendment.  See FW/PBS, Inc. v. City of Dallas, 493
U.S. 215, 223-227 (1990) (plurality); id., at 238 (Brennan, J.,
concurring in the judgment); see id., at 241 ("danger posed . . . is
not derived from the basis on which the license was purportedly denied
. . . . [but from] the unlawful stifling of speech that results.").

As to the non-code items defined as "software," as noted above at pages
3-4, Defendants assertion that they never actually apply the portion of
the definition including algorithms is directly refuted by their own
actions here. It also demonstrates that there is a genuine issue of
material fact requiring discovery as to Defendants' practice with
others.

1. Defendants Cannot Rewrite History: They Did Apply the ITAR Licensing
Scheme to Plaintiff's Academic Paper and Instructions.

As noted above, Defendants' assertion that "The ITAR Was Not Applied to
Restrain Publication of Plaintiff's Paper or the Instructions," (Defs'
Mem 4:6-14, 5:24-9) is simply wrong. The question raised by the Court
was whether Defendants belated, post-litigation retraction of their
decision designating both the Paper and Instructions as defense
articles mooted Plaintiff's challenges to the constitutionality of that
determination. The answer to that question is no. Voluntary cessation
of an allegedly unlawful practice without clear evidence that the
censorship cannot be reapplied, does not moot a facial challenge.
United States v. W.T. Grant Co., 345 U.S.  629, 632 (1953); See e.g.
City of Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283 (1982); Luckie
v. E.P.A. 752 F.2d 454, 458-59 (9th Cir. 1985). ("If Plaintiff shows a
mere probability of recurrence, coupled with a certainty that the
impact will fall on the same objecting litigants, the government has a
heavy burden to show there is no reasonable expectation that the
alleged violation will recur.")

At issue in City of Mesquite, was the vagueness of a local ordinance
which allowed the City Manager to refuse an arcade license to those
with "connections with criminal elements." After an injunction against
the provision was entered, the city amended the licensing scheme to
remove the allegedly vague language. This unilateral act by the
government did not moot the case, however:

	It is well settled that a defendant's voluntary cessation of a
	challenged practice does not deprive a federal court of its
	power to determine the legality of the practice. . . In this
	case the city's repeal of the objectionable language would not
	preclude it from reenacting precisely the same provision if the
	District Court's judgment [granting the injunction] were
	vacated. . . . There is no certainty that a similar course
	would not be pursued if its most recent amendment were
	effective to defeat federal jurisdiction.

City of Mesquite, 455 U.S. at 289.

Plaintiff has even less protection than the City of Mesquite
Plaintiffs.  Neither Defendants' "clarification" letters nor their C.J.
determinations are binding. 22 C.F.R. 126.9. Even if a license is
granted it can be revoked if Defendants deem it "advisable." 22 C.F.R.
126.7(a). Moreover, PROF. BERNSTEIN plans to continue to work and
publish in this field.  Bernstein Decl. paras. 43-46. His future work
will certainly run afoul of the ITAR Scheme again. Unless the ITAR
Scheme is changed to limit Defendants' discretion, the illegal
censorship has much more than a mere probability of recurrence.
Moreover, when it does recur, as is likely, there is an absolute
certainty that the impact such censorship will chill Plaintiff's
activities -- either directly or as he sees that others are restrained
and/or prosecuted. Defendants have therefore failed to meet their
burden under Luckie.

B. The Technical Data Provisions of the ITAR, On Their Face, Regulate
Scientific and Academic Publication and Exchange.

Defendants then address the facial challenge which Plaintiff makes to
the technical data provisions. Defendants begin by pointing out the
various exceptions which they have made to the ITAR for certain
specific speech activities. There are three main problems with this
line of argument, the first two of which are addressed more fully
elsewhere. First, the exceptions are not practically enforceable since
after the Edler decision the AECA was amended to add Sec. 2778(h) which
precludes judicial review. Plaintiff's Motion at 40:11-19. Second, as
explained in further detail in Section IV, below, the exemptions
themselves are impermissibly vague.

Third, Defendants' argument, which they repeat several time throughout
the brief, (Defs' Mem 7:3 - 9:9; 29:20-30:13; 33:3-34:2) turns First
Amendment analysis on its head. In evaluating whether a regulatory
scheme meets First Amendment scrutiny, the question to be addressed by
a Court is not whether the scheme exempts some speech from regulation;
the question is whether, even with the exceptions, the scheme still
regulates speech. Defendants' argument is based on the following
provisions:

	information concerning general scientific, mathematical or
	engineering principles commonly taught in schools, colleges,
	and universities. 22 C.F.R. 120.10(a)(5).

and information that is in the "public domain", which includes:

	information which is published and generally available and
	accessible through, inter alia, sales at newsstands and
	bookstores, subscriptions, second class mail, and libraries
	open to the public. 22 C.F.R. 120.11(a)(1)(2)(3)(4)

and

	information which is made generally available to the public
	through unlimited distribution at a conference, meeting,
	seminar, trade show or exhibition, generally accessible to the
	public, in the United States or through fundamental research in
	science and engineering at accredited institution of higher
	learning in the U.S. where the resulting information is
	ordinarily published and shared broadly in the scientific
	community. 22 C.F.R. 120.11(a)(6), (8).

Even if the definitions were construed unambiguously and even if these
clauses were enforceable, the plain meaning of these terms still leaves
significant First Amendment protected activity subject to regulation.
First, they do not protect a U.S. engineer who wishes to discuss
technical matters with foreign colleagues. This situation is presented
by Dr. Matthew Blaze, who develops ideas about cryptography for AT&T
Laboratories, as a professor at Columbia University and on his own. Dr.
Blaze's discussion of his cryptographic ideas with a foreign colleague
still requires a license.  Blaze Decl. paras. 6-9, 12-15.

Second, they do not protect the software published by Mr. Demberger.
Demberger Decl. paras. 2-13. Mr. Demberger developed his cryptographic
ideas privately, not at an institution of higher learning, and did not
seek to present them at a conference or seminar, but instead to post
them to sci.crypt, the same public Internet discussion group where
PROF. BERNSTEIN intends to publish Snuffle. Dr. Blaze and Mr. Demberger
exemplify the ITAR's effects on scientists and engineers who are not in
academia. Mr. Demberger also illustrates how the public domain
exemption has not caught up with the Internet, since it does not
specifically mention electronic publication.

Even academics are unprotected in important circumstances. The
exemptions do not protect small-group exchanges or personal
communications of new ideas.  For example, since his Instructions are
about a specific new idea--Snuffle--and so are neither a general
principle nor fundamental research, PROF. BERNSTEIN's disclosure of
them to a foreign academic or scientist would not be exempt. Much
innovation and development takes place before formal publication
occurs.

In sum, these exemptions simply do not protect the large numbers of
scientists and hobbyists who are not in academia, those in academia
whose work is not "fundamental research" or about "general principles,"
or those even in academia who do not wish to publish their technical
data but merely to communicate it to colleagues or peers abroad. Yet
all of these activities are protected scientific expression.

C. The Technical Data Provisions of the ITAR, As Applied, Regulate
Scientific and Academic Publication and Exchange.

1. The Public Domain Exception Does Not Function To Prevent Academic
and Scientific Censorship.

Moreover, the State Department's assertions here also stand in direct
contrast to their specific pronouncements of their intent to suppress
cryptographic technical data. Indeed, these pronouncements indicate
that they still intend to control technical data related to
cryptography. In 1980, eleven years after United States v. Edler
Industries, Inc., (579 F.2d 516 (9th Cir. 1978)), was decided, the
State Department stated: "[T]he public is reminded that professional
and academic presentation and informal discussions, as well as
demonstrations of equipment, constituting disclosure of cryptologic
technical data to foreign nationals, are prohibited without the prior
approval of this office" subject to certain exemptions. It continued:

	The interpretation set forth in this newsletter should exclude
	... most basic scientific data and other theoretical research
	information, except for information intended or reasonably
	expected to have direct cryptologic application. Because of
	concerns expressed to this office that licensing procedures for
	proposed disclosures of cryptologic technical data contained in
	professional and academic papers and oral representations could
	cause burdensome delays in exchanges with foreign scientists,
	this office will expedite consideration as to the application
	of ITAR to such disclosure.

Dept. of State, 80 Munitions Control Newsletter (February 1980),
attached to Tien Decl., Exhibit E, NRC Report, page 4-47 (emphasis
added).

Defendants' now state that they no longer consider such scientific and
academic activities subject to their export licensing jurisdiction. But
no authoritative administrative or judicial construction of the AECA or
ITAR holds them to this position, and it is inconsistent with their
established record. Even the National Research Council, which was given
full access to Defendants' personnel and records could find no better
statement about Defendants' current interpretation of the technical
data provisions than the statement above. NRC Report 4-30. The NRC also
noted that academics are often unclear about the scope of the technical
data provisions and that this confusion extends to "teaching a course
on cryptography." Id. If Defendants have changed their policy, they
certainly have kept this change well-hidden.  In any case, because the
regulations on their face permit Defendants to regulate academic and
scientific activities, Defendants' good intentions are irrelevant. That
Defendants will adhere to standards are absent from a regulation's face
is "the very presumption that the doctrine forbidding unbridled
discretion disallows." Lakewood, 486 U.S. at 770. If Defendants are
committed to exempting academic publication, they must not only concede
that Plaintiff, a mathematics professor, may freely publish Snuffle in
all its forms as part of the international scientific exchange of ideas
about cryptography, but also disclaim any censorship authority by
regulation.

2. Defendants' Assertion That The ITAR Has No Impact on Scientific and
Academic Development of Cryptography Is Demonstrably False.

Defendants next claim that the ITAR has no impact on academic
discussion of cryptography. Defs' Mem at 8:24-9:9. This factual
assertion is not only in dispute, it is demonstrably false. That
Plaintiff has been unable to contribute Snuffle to the scientific
debate disproves Defendants' assertions. In addition, the Declarations
served with Plaintiff's Motion further attest to the presence of a
chilling effect and the negative effect the ITAR Scheme has on the
development of the science of cryptography.  Further, Mr. Demberger and
Mr. Behlendorf both report that the Government has warned them that
their publications may violate export controls. These warnings were
"obviously intended" to "curtail the circulation" of information. Cf.
Bantam Books Inc. v. Sullivan, 372 U.S. 58, 64-65 n.6 (1963) (warnings
from quasi-official commission to local booksellers that certain
materials were obscene are prior restraint). As the Bantam Books court
acknowledged, courts have long looked through form to substance and
properly condemned informal censorship as well as formal censorship.
Id., at 67. Here, the warnings came not from private citizens, but from
those with the power to prosecute.

In addition, the mere existence of some debate about cryptography does
not establish that self-censorship is not occurring. The great vice of
a censorship scheme is the chilling effects, which are difficult, if
not impossible, to measure. An administrative licensing scheme
"intimidates parties into censoring their own speech, even if the
discretion and power are never actually abused." Lakewood, 486 U.S. at
757. "It is not merely the sporadic abuse of power by the censor but
the pervasive threat inherent in its very existence that constitutes
the danger to freedom of discussion." Thornhill v. Alabama, 310 U.S.
88, 97 (1940). Thus, as explained more below at pages 25-26, the
government's attempt to portray the existing cryptographic literature
as robust and flourishing is also entirely beside the point, because
much self-censorship is invisible.  The only appropriate way to prevent
such chilling effects is to (1) set clear, narrow standards for the
licensor to follow; and (2) provide for proper procedural protections
in the event the licensor misapplies those standards. Lakewood, 486
U.S. at 758. ( "Only standards limiting the licensor's discretion will
eliminate this danger by adding an element of certainty fatal to
self-censorship").

D. ITAR Restrictions on Cryptographic Source Code Regulate Scientific
Publication and Academic Exchanges.

Defendants conveniently ignore another great impact on scientific and
academic speech created by the ITAR Scheme -- that caused by the
restrictions on cryptographic source code. Defendants admitted
regulation has obvious impact on scientific marketplace of ideas.
Source code is fundamental to the development of the science of
cryptography, as it is for many other areas of science. See Motion at
3:4-5:2; Schneier Decl. paras. 15-26, 32-34; Abelson Decl. paras. 3-17;
Appel Decl.  paras. 6-17; Blaze Decl. paras. 10-11; Ginsparg Decl.
paras. 8-17; Ellison Decl. paras. 8-30; Stallman Decl. paras. 6-9;
Johnson Decl. paras. 13-21. In restricting the language by which
Plaintiff and others may communicate, Defendants unconstitutionally
prescribe the "form and content" of their expression. Cohen v.
California, 403 U.S. 15, 24 (1971); Hurley v. Irish-American Gay,
Lesbian and Bisexual Group of Boston, 115 S.Ct. 2347, 2358 (1995).

E. Neither Edler Nor Defendants' Post-Edler Amendments to the ITAR
Scheme Eliminates Plaintiff's First Amendment Challenge to the
Technical Data Provisions of the Current ITAR.

In his Motion, Plaintiff has already provided an extended explanation
of why the decision in Edler does not eliminate his challenge to the
technical data provision of the ITAR. See Plaintiff's Motion at pages
39-41 and notes 10 and 39.

Defendants also assert that their post-Edler amendments to the ITAR
have eliminated any constitutional infirmities. Plaintiff has explained
in numerous places throughout both this Opposition and his own Motion
that these changes, most of which are the exemptions, simply fail to
bring the ITAR Scheme into constitutional conformity. See pages 27,
29-33 Plaintiff's Motion at 40:11-19.

F. The Prior Restraint Created by the ITAR Scheme Does Not Pass
Constitutional Muster and Must Be Invalidated.

Defendants here have failed entirely in their burden to show that
publication of speech about cryptography, including source code, meets
the Pentagon Papers test. In that case, Justice Brennan summarized the
types of evidence which the Government must submit to meet this
standard:

	there is a single, extremely narrow class of cases in which the
	First Amendment's ban on prior judicial restraint may be
	overridden. Our cases have thus far indicated that such cases
	may arise only when the Nation 'is at war' Schenk v. United
	States, 249 U.S. 47, 52 (1919), during which times '(n)o one
	would question but that a government might prevent actual
	obstruction to its recruiting service or the publication of the
	sailing dates of transports or the number and location of
	troops' Near v. Minnesota ex rel Olson, 283 U.S. 697, 716
	(1931).

Pentagon Papers, 403 U.S. at 726 (Brennan, concurring). See also United
States v. Progressive, Inc, 467 F.Supp. 990 W.D. Wis. 1979), rehear
den. at 486 F.Supp.5 (W.D. Wis. 1979)(publication of technical
information on the making of a hydrogen bomb).

Here, our nation is not at war. PROF. BERNSTEIN does not seek to
publish any information about the Government's placement of troops or
ships or to interfere with its ability to recruit soldiers. Defendants
here do not, and cannot, claim that the publication of cryptographic
source code and related information itself can cause any damage, much
less create the imminent risk of thermonuclear destruction. The
information he seeks to publish is not even classified.

Rather, piling speculation on speculation, Defendants allege that this
information, if misused by others, could limit Defendants' ability to
conduct foreign surveillance. Defs' Mem at 19:22-24. The interest in
foreign intelligence gathering is only an intermediate interest. Others
must act before harm will occur. There is an huge gap between the
occurrence of harm -- some foreign entity using Plaintiff's source code
to encrypt communications planning a bad act which communications our
government wishes to intercept -- and Plaintiff's publication. As the
OLC noted, "[S]peech does not lose its protected character solely
because the circumstances of the case give rise to a reasonable fear
that persons other than the speaker may be moved or enabled by the
speech to do dangerous things at remote times and places." OLC Memo,
Exh. B to Tien Decl. at Bates # 60057, citing Brandenberg v. Ohio, 395
U.S. 444 (1969). Here Defendants rely on just such a remote harm and so
the ITAR Scheme fails to meet the strict standard for prior
restraints.

II. THE ITAR SCHEME IS PRESUMPTIVELY INVALID AS A CONTENT-BASED
RESTRAINT ON PROTECTED SPEECH.

Defendants next attempt to justify their regulations as aimed at the
functionality, not the content, of cryptographic software, hoping to
invoke the weak scrutiny of United States v. O'Brien, 391 U.S. 367
(1968). That effort is unavailing.

A. The Export Controls On Crytographic Software Are Content-
Discriminatory On Their Face.

At the most basic level, the ITAR Scheme burdens public, academic, and
scientific discussion of the entire subject of cryptography.
Defendants' primary argument is that the ITAR Scheme's licensing of
cryptographic software and its underlying academic and scientific
foundations is a content-neutral regulation of something other than
speech. This point is belied by Defendants' own words. On its face, the
ITAR treats cryptographic expression differently . Much of Defendants'
argument emphasizes that cryptographic software is a defense article
and not technical data based on 22 C.F.R. 121.8(f)(specifically
mentioning Category XIII(b)) -- but software related to other USML
categories is technical data. 22 C.F.R.  120.10(a)(4). It is common
sense that a regulation which affects speech differently depending on
what it is about is "content based." See City of Cincinnati v.
Discovery Network, Inc., 507 U.S. 410, 429 (1993); Police Dep't of
Chicago v. Mosley, 408 U.S. 92, 95 (1972).

In addition, as Defendants again concede, the ITAR on its face
presupposes that Defendants actually review software and academic and
scientific information and appraise its possible uses, strengths, and
effectiveness, to determine whether or not it is "capable of
maintaining secrecy." A scheme which involves a licensor in the
appraisal of facts, the exercise of judgment and the formation of an
opinion is a content-driven scheme. See e.g. Cantwell v. Connecticut,
310 U.S. 296, 305 (1940). Defendants permit relatively "weak"
cryptographic speech while prohibiting similar speech if expressed in
stronger, more effective key lengths. See Defs' Mem at p.25, n.26;
e.g., Johnson Decl., at para. 30. Such inquiries are inherently
content-driven since they are meant to prohibit only speech about
powerful cryptographic ideas.

Third, the ITAR is content-based because it discriminates against
foreign persons. 22 U.S.C. (g)(1)(C)(5); 22 C.F.R. 120.17(a)(4),(5).
The legislature is constitutionally disqualified from dictating the
subjects about which persons may speak and the speakers who may address
a public issue. First National Bank of Boston v. Bellotti, 435 U.S.
765, 784-85 (1978). The ITAR Scheme does both.

Finally, Defendants' public pronouncements about their interest in
maintaining the ITAR Scheme restrictions on cryptography reveal a
content-based interest: to influence cryptographic methods and
algorithms used domestically. The Government has clearly stated that
its current application of the ITAR Scheme ties export control
decisions to whether a product supports its preferred encryption method
called key-escrow or Government Access to Keys ("GAK"). The Government
has also clearly stated that it favors the GAK method in large part
because the method allows the Government to have access to domestic
private messages. In implementing this interest, Defendants have
offered exemptions from ITAR licensing for GAK methods, making it
easier for them to be distributed in the U.S. as well as abroad. Id.
The misuse of an arms export restriction to attempt to control the
availability of domestic, nonmilitary cryptographic software
demonstrates not only that the scheme is content based, but also the
unfettered breadth of discretion, the overbreadth and the ultra vires
nature of the ITAR Scheme.

B. Regulation Of Cryptographic Software Because It Functions To Encrypt
Is Content-Based Regulation.

Defendants argue that the ITAR Scheme restricts cryptographic software
not because of its content, but because of its "functionality." See
Def's Mem at 21-23. This time, Defendants appear to argue that because
software can be used to do something, regulation of software because of
what it can be used to do is not content based. This argument, which
has already been rejected in a slightly different form by this Court
once (Bernstein, 922 F.Supp. at 1434-6), is once again unsupported by
any legal authority.

This argument is far to sweeping. Software, by itself, does nothing.
Defendants argue that a recipe for a cake is not a cake, but that
software is different. But just as a recipe for a cake is not a cake
without ingredients, an oven and a baker, cryptographic software cannot
function without a message, a computer and a person to use it In saying
that software "can be made to function," Defendants implicitly concede
that cryptographic software needs a person (and a computer) to do
anything. Defs' Mem at 22.  What a listener does with information can
be conduct outside of the First Amendment, but the listeners conduct is
not the speaker's speech.

More generally, "[t]he music inscribed in code on the roll of a player
piano is no less protected for being wholly functional." Bernstein, 922
F.Supp. at 1435. "[It] 'communicates' to and directs the instrument
itself, rather than the musician, to produce the music. That does not
mean it is not speech." Ibid. The same is true if the music is
digitally inscribed on a compact disk (or "CD"). A CD directs the
computer in the CD player to turn the digital computer code into a
sound that may be heard and understood by the listener.  Like
cryptographic software, the CD is necessarily imbued with
"functionality." That does not mean that Defendants can regulate the
content of CDs, even if they may be played too loudly.

To the extent that software "functions," that function is inseparable
from content. Computer Science and all of its related fields, like
cryptography, are devoted to the designing and testing of software.
Here, Defendants target cryptographic software; but the functionality
rationale extends to all software because all software can be used to
do something. Regulation of software necessarily is regulation of
computer science.

Moreover, Defendants do not regulate functionality per se, but rather
the specific functionality of cryptographic software--its enablement of
private speech. Viewed in this way, it becomes clear that the real
target of the regulation is private speech. Thus the Government is
regulating cryptographic "functionality" on the grounds that it might
facilitate harmful speech. The Ninth Circuit in Edler rejected a
similar proposition in the context of technical data, that "[a]ny
information that would in any way help in a process that led to the
final product [comes] under the definition of technical data." Edler,
579 F.2d at 522 (permitting Edler on remand to show that its assistance
"would not, of itself, suffice for the manufacture of rocket nozzle
components"). Similarly, this argument should be rejected here. Indeed,
this "functionality" target is doubly problematic because the First
Amendment protects the freedom to communicate only with one's chosen
audience. See Plaintiff's Motion at 14:16-15:7.

Nor can Defendants save the ITAR as a content-neutral regulation, as
they attempt to do, by redefining what is at issue as the "conduct" of
"exporting" of software, source code and related cryptographic speech.
See Defs' Mem., at p.23. A major constitutional problem with the ITAR
Scheme is its definitions of "export" for both technical data and
defense articles prohibit general publication, public discussion and
scientific and academic exchange. See 22 CFR  120.17(a)(1), (a)(4) and
Plaintiff's Motion at 41:10-42:3. Obviously, Defendants cannot censor
these protected activities merely by relabelling them as the "conduct
of export." The "export" controls are thus manifestly a direct
regulation of expression, not conduct.

C. Because The ITAR'S Export Controls Implicate Speech Alone, The First
Amendment Demands Strict Scrutiny.

Having attempted to justify the ITAR as a content-neutral regulation
aimed at functional "conduct" rather than pure speech, Defendants gloss
over the constitutional standard required of content-driven
restrictions: the government must affirmatively demonstrates that the
"regulation is necessary to serve a compelling state interest and that
it is narrowly drawn to achieve that end." Boos v. Berry, 485 U.S. 312
(1988).

Defendants' asserted interest in preventing harm to foreign
intelligence gathering is not compelling, because it is only an
interest in efficiency.  The real harm flows from whatever planned harm
might not be prevented due to the use of encryption, since U.S.
decisionmakers did not receive the planning messages. In context, the
asserted harm is that the government will be less efficient in
gathering foreign intelligence in general if cryptographic software is
freely publishable. "The governments' interest in achieving its goals
as effectively and efficiently as possible" is "a relatively
subordinate interest . . . The government cannot restrict the speech of
the public at large just in the name of efficiency." Yniguez v.
Arizona for Official English, 69 F.3d 920, 938 (9th Cir. 1995)(en
banc), cert granted 64 U.S.L.W. 3639 (Mar. 25, 1996)(No. 95-974),
quoting Walters v. Churchill, 114 S.Ct. 1887, 1888 (1994)(plurality
opinion). Accordingly, the ITAR Scheme fails the first prong of the
strict scrutiny analysis.

Moreover, even if after discovery Defendants were able to satisfy the
compelling interest test, they must also show the ITAR is "narrowly
drawn," i.e., that it is the least restrictive means of achieving its
stated purpose. Boos 485 U.S. at 312 (1988). On its face, the ITAR
adopts the most restrictive method of prohibiting publication, public
communication, and cryptographic expression -- not by restricting
military and national security applications -- but by banning
discussion about an entire subject area: the science of cryptography.
"Broad prophylactic rules in the area of free expression are suspect.
Precision of regulation must be the touchstone in an area so closely
touching our most precious freedoms." NAACP v. Button, 371 U.S. 415,
428 (1963). As amply demonstrated on pages 25-27 below and on pages
38:1-43:9 of Plaintiff's Motion, the ITAR Scheme lacks any such
precision. It is not narrowly drawn and, thus, fails the second prong
of the strict scrutiny analysis.

D. The ITAR's Export Controls Are Facially Invalid Even If Viewed As
Content-Neutral.

1. The ITAR Scheme Cannot Survive The Intermediate Level Of Scrutiny
Required By United States v. O'Brien.

Defendants argue that the less exacting standard specified in O'Brien
should be applied here. For at least three reasons, however,
Defendants' reliance on O'Brien is unavailing here. First, O'Brien
applies only when"[a]pplication of a facially neutral regulation . . .
incidentally burdens speech." United States v. Albertini, 472 U.S. 675,
687 (1985) (emphasis added). As shown above, the ITAR is not facially
content neutral.  Second, a condition of applying O'Brien is that the
regulation "incidentally," not directly, burdens speech. The ITAR
controls are plainly not an "incidental burden" on protected
expression. They are instead concerned with the direct, primary aspects
of the expressive activities sought to be controlled, the "disclosure"
of technical data and the general publication and public discussion of
source code.

Third, as a related matter, the ITAR Scheme cannot survive O'Brien's
final prong, i.e., that the "incidental" restriction on expression be
narrowly tailored. As explained above, the ITAR is not narrowly drawn.
Even under O'Brien's more relaxed narrow tailoring requirement, a
restriction on speech may not "burden substantially more speech than is
necessary to further the government's legitimate interest." Ward v.
Rock Against Racism, 491 U.S. 781 (1989); Grossman v. City of Portland,
33 F.3d 1200, 1205-08 (9th Cir. 1994).

As explained in further detail in Plaintiff's Motion at 41:10-43:9 the
ITAR Scheme burdens U.S. citizens who would receive public
communications, and place burdens on their ability to receive software
containing strong cryptography. The Scheme further prohibits all
foreign persons from either giving or receiving any information about
cryptography. Id. The ITAR Scheme casts this wide, vague net despite
the fact that its stated goal is only to prevent foreign terrorists and
enemy governments from receiving these ideas.  That is the most
draconian way of addressing Defendants' stated concerns. In short, the
ITAR Scheme fails even the intermediate level of scrutiny required by
United States v. O'Brien.

2. The ITAR Scheme Is An Unconstitutional Ban On A Particular Mode Of
Expression.

Moreover, even assuming arguendo that the ITAR Scheme may be viewed as
content- neutral, it is nonetheless unconstitutional because it imposes
a complete prohibition against Internet communication as a means of
expressing ideas in the field of cryptographic science.

American jurisprudence has long been concerned with laws that foreclose
an entire medium of expression. For example, the Supreme Court has held
invalid laws that banned the distribution of pamphlets within a
municipality (Lovell v. Griffin, 303 U.S. 444, 451-452, (1938)),
handbills on public streets (Jamison v. Texas, 318 U.S. 413, 416
(1943)), and door-to-door circulation of literature. Schnieder v.
State, supra, 308 U.S. at 164-165. Similarly, in City of Ladue v.
Gillieo, 512 U.S. 43 (1994) the Court struck down an ordinance that
foreclosed a common, inexpensive, and convenient medium of political,
religious, or personal expression -- signs placed on one's property --
concluding:

	[a]lthough prohibitions foreclosing entire media may be
	completely free of content or viewpoint discrimination, the
	danger they pose to the freedom of speech is readily apparent
	-- by eliminating a common means of speaking, such measures can
	suppress too much speech.

The same is true here. As a three judge panel in the Eastern District
of Philadelphia recently observed, the Internet, through its on-line
communication and information services -- like the front-door signage
of old -- offers citizens around the world a convenient, inexpensive,
and common means of political, religious, personal, professional,
scientific, and academic expression. See ACLU v. Reno, 1996 WL 311865
(E.D. Pa.,) June 11, 1996) Findings of Fact para. 4, para. 7, para. 81.
Under the ITAR, however, this important mode of communication is
entirely cut off to those who wish to use it to express their
scientific and academic ideas regarding cryptography. See, e.g.,
Bernstein Decl., at para. 9; Demberger Decl., para. 2; Appel Decl.,
para. 11; Ellison Decl. paras. 28-30; Ginsparg Decl., paras. 3-8; and
Stallman Decl., paras. 6-9. As such, the Scheme fails strict scrutiny
under City of Ladue.

III. THE ITAR SCHEME IS OVERBROAD ON ITS FACE AND AS APPLIED.

In First Amendment cases, the rules of standing are relaxed. Sec'y of
State of Maryland v. Joseph H. Munson Co., 467 U.S. 947, 957 n. 7
(1984); id. at 958 (finding that Plaintiff could bring facial challenge
to restrictions on charitable solicitations "whether or not its own
First Amendment rights are at stake"). Where a statute unquestionably
attaches sanctions to protected conduct, the likelihood that the
statute will deter that conduct is ordinarily sufficiently great to
justify an overbreadth attack. Members of the City Council of Los
Angeles v. Taxpayers for Vincent, 466 U.S. 789, 800, n. 19 (1984).

A. The Court May Properly Consider and Grant Plaintiff's Facial
Challenge.

Defendants argue that under Brockett v. Spokane Arcades, Inc., 472 U.S.
491 (1985), a party who claims his or her own conduct is protected
speech may not invoke facial overbreadth. This authority is dubious at
best. Even after Brockett, the Supreme Court has heard facial
overbreadth claims without ruling on the as-applied claim. See City of
Houston v. Hill, 482 U.S. 451, 458 n. 6 (1987); Bd. of Airport Com'rs
of Los Angeles v. Jews for Jesus, Inc., 482 U.S. 569, 573-74 (1987).

The Ninth Circuit has rejected the argument that facial overbreadth is
improper whenever the challenger's conduct is protected. Lind v.
Grimmer, 30 F.3d 1115, 1122 (9th Cir., 1994). cert den sub nom. Want v.
Lind, 115 S.Ct.  902 (1995) (distinguishing Brockett and Renne v.
Geary, 501 U.S. 312, 324 (1991)); accord, Yniguez, 69 F.3d at 931. Lind
identifies the proper judicial concern: "[W]here a statute's
overbreadth is substantial, its chilling effect is likely to be
significant, and consequently the entire statute may be invalidated to
protect First Amendment interests." Lind 30 F.3d at 1122 (citation
omitted). Here, as in Lind, even if the Court strikes those portions of
the ITAR Scheme which are unconstitutional as applied to Plaintiff, the
remainder of the ITAR Scheme will have numerous potential
unconstitutional applications.

More importantly, facial challenges to highly discretionary licensing
schemes like the ITAR Scheme are favored. "[W]hen a licensing statute
allegedly vests unbridled discretion in a government official over
whether to permit or deny expressive activity, one who is subject to
the law may challenge it facially." Lakewood, 486 U.S. at 755; accord,
Forsyth County v.  Nationalist Movement, 505 U.S. 123, 129-130 (1992).
This is because an "as applied" challenge cannot remedy the harms of
self-censorship inherent in a broad licensing scheme. See Virginia v.
American Booksellers Ass'n, Inc., 484 U.S. 383, 393 (1988) (Plaintiff
booksellers alleged that bookbuyers' First Amendment rights were
infringed). Plaintiff's facial challenge is therefore independently
justified because the ITAR Scheme is a standardless licensing scheme.

Even if Plaintiff can only facially challenge as overbroad those
portions of the ITAR Scheme which do not affect him directly,
Plaintiff's facial challenge stands. First, Plaintiff challenges the
ITAR Scheme's discrimination against foreign persons whose rights to
speak are infringed because AECA renders foreign persons ineligible for
a license. 22 U.S.C.  2778(a)(1)(C)(5). Their rights to receive
information are infringed because the ITAR defines an export, inter
alia, as disclosure of technical data to a foreign person. 22 C.F.R.
120.17(a)(4); see Plaintiff's Motion at 14:1-15.  Clearly, there is a
"significant difference" between the claims of Plaintiff and those of
foreign persons not before the Court.

Second, Plaintiff challenges the ITAR Scheme's restrictions on all
technical data and all software which may be treated as a defense
article by Defendants' application of 22 C.F.R. 121.8(f). Plaintiff's
as-applied attack addresses restrictions on cryptographic speech only.
But the ITAR Scheme has affected many other areas of science as well.
Thus Plaintiff's overbreadth challenge seeks to protect the rights of
many kinds of scientists, not just cryptographers.

In short, where, as here, Plaintiff challenges a regulation as applied
to his interests, and other aspects of the scheme solely pertain to
third party interests that the Plaintiff does not personally share, it
is the settled law that both claims may proceed. See Board of Trustees
of State University of New York v. Fox, 492 U.S. 469 (1989) (students
may seek to vindicate their own rights, as well as third party
commercial interests, in challenging school regulation barring use of
dormitories to demonstrate commercial products).

B. The Challenged Provisions Are Substantially Overbroad.

Overbreadth requires a realistic danger that the statute itself will
significantly compromise recognized First Amendment protections of
parties not before the Court. Vincent 466 U.S. 789 (1984) at 801.

Here, the burden on speech is quantitatively substantial and the
chilling effects are plainly seen. The ITAR Scheme on its face requires
a license for any disclosure of technical data to a foreign person, any
disclosure of cryptographic software, including algorithms and source
code, which leaves the United States, and any service which aids a
foreign person in using cryptographic software. As a practical matter,
the licensing requirements reach general publication because the U.S.
public includes foreign persons and because, as a rule, such
publication leaves the United States.

Since every "disclosure" of technical data to a foreign person is
burdened, OLC identified two common situations where technical data
might be innocently disclosed: the teacher in a university whose class
includes foreign students; the U.S. engineer who wishes to discuss
subjects with foreign colleagues. Tien Decl., Exh. A, Bates #60007,
60018, 60045. The OLC did not mention the publication of books or
journal articles, but these raise the same issues.

In the modern scientific world, electronic communications increase the
number of instances where scientists and engineers can engage in
discussion with foreign persons, either by speaking to a worldwide
audience on the Internet, or to colleagues outside the United States
via e-mail. PROF.  BERNSTEIN might, for instance, seek to transmit a
copy of Snuffle to a U.S.  colleague in another country. The ITAR
Scheme requires a license for these types of protected electronic
communications as well.

A substantial chilling effect is also seen in requirement of advance
notice inherent in the ITAR Scheme's licensing requirements. This
requirement "drastically burden[s] free speech" because the procedural
and temporal hurdles of submitting an application and waiting for a
license may discourage potential speakers. Grossman, 33 F.2d at 1206
(quotation and citation omitted). Moreover, by discouraging speakers,
the Scheme significantly burdens the public's right to read and hear
what would otherwise have been written or said. United States v.
National Treasury Employees Union, 115 S.Ct. 1003, 1015 (1995) ("NTEU")
("no way to measure the true cost" of burden imposed by honoraria ban,
"but we cannot ignore the risk that it might deprive us of the work of
a future Melville or Hawthorne") (footnote omitted).

1. The ITAR Scheme Restricts Speech That Poses No Harm To Government
Interests.

While some communications of technical data or software might well be
prohibited by a properly drawn statute, such as where the speaker
intends to assist a hostile foreign government, this ITAR Scheme does
not distinguish such situations. This results in further overbreadth.
According to Defendants, the ITAR Scheme's restrictions on
cryptographic information target harm to "critical foreign
intelligence-gathering functions." But even if we look only at
cryptography, the ITAR Scheme clearly reaches protected expression that
is in no way linked to that harm.

The Government cannot require that all such disclosures and exchanges
be licensed just because some of them may be harmful. "Deferring to the
Government's speculation about the pernicious effects of thousands of
articles and speeches yet to be written or delivered would encroach
unacceptably on the First Amendment's protections." NTEU at 1017-18 n.
21.  At a minimum, such a claim requires discovery.

2. The Exemptions Do Not Eliminate Overbreadth.

Defendants then claim that the various exemptions in the ITAR limit its
facial overbreadth. But these exemptions are legally meaningless
because, as noted above, a court cannot review Defendants' decision
that something is controlled by them. 22 U.S.C. 2778(h). Even if we
ignore this problem, the exemptions fail because they are ambiguous, as
explained below. Such vagueness amplifies the Scheme's overbreadth; "a
court should evaluate the ambiguous as well as the unambiguous scope of
the enactment. To this extent, the vagueness of a law affects
overbreadth analysis." Village of Hoffman Estates v. Flipside, 455 U.S.
489, 494 n. 6 (1982).

IV. THE ITAR SCHEME IS UNCONSTITUTIONALLY VAGUE.

Defendants' response to Plaintiff's vagueness challenge is seriously
misguided. Where speech is at issue, laws must be narrowly specific.
Buckley v. Valeo, 424 U.S. 1, 77 (1976); Button, 371 U.S. at 432;
Bullfrog Films, 847 F.2d at 513. Defendants, for the most part, defend
the ITAR Scheme as "reasonably clear," making only passing reference in
a footnote to the stricter First Amendment standard.

Laws, however, are not only rules of public conduct which must give
fair notice of what is prohibited; laws are also rules of official
conduct which must provide legislative standards for enforcement
officials and for the courts. Kolender v. Lawson, 461 U.S. 352, 358
(1983). This aspect of vagueness - on which Defendants are,
essentially, silent - is especially important where speech is
concerned.

The absence of standards is a First Amendment vice in three main ways.
It permits arbitrary enforcement. Grayned v. City of Rockford, 408 U.S.
104, 108-09 (1972) (abdication on policy matters creates risk of
"arbitrary and discriminatory application"). It renders "inoperative"
judicial review of enforcement. Interstate Circuit v. City of Dallas,
390 U.S. 676, 684-85 (1968). Most important, vagueness engenders
self-censorship "even without an actual prosecution." American
Booksellers, 484 U.S. at 393; see Hoffman Estates, 455 U.S. at 499
("Perhaps the most important factor . . . is whether [a law] threatens
to inhibit the exercise of constitutionally protected rights."). Judged
by these well-settled tests, the ITAR Scheme fails entirely.

A. The ITAR's Labels Are Vague.

Defendants argue that, taken individually, the technical data and
cryptographic software provisions are reasonably clear. But a root of
the ITAR's vagueness is the ambiguity of the labels "technical data,"
"defense article," and "defense service." By taking these provisions
one at a time, Defendants obscure the more fundamental problem that on
the face of the ITAR, these labels at best overlap and at worst cannot
be differentiated.  Plaintiff's Motion at 6:3-7:13; 34:13-35:1. If
anything in ITAR must be especially clear, it is these initial
categories -- yet they are not.  The most glaring example of this
vagueness in the definition of defense articles and technical data is
presented by the facts in Karn v. U.S.  Department of State, 925
F.Supp. 1 (D.D.C. 1996) (appeal docketed). When Mr.  Karn submitted a
CJ Request for printed cryptographic source code from Mr.  Schneier's
book, Applied Cryptography, Defendants determined that it was in the
public domain. When he submitted virtually the same information to
Defendants on a floppy disk, they determined that it was a defense
article and so could never be placed into the public domain (an
assertion unsupported by the text of the exemption).

It is difficult to see how these two determinations can be reconciled,
or indeed what clear labelling and realistic distinction between
technical data and defense articles compels this conclusion. This
categorical distinction, based solely upon medium on which the
information written, is not only not narrowly specified in the
regulations, it is not even "reasonably clear" from them.

B. Defendants' Focus on the Clarity of Their Exemptions Is Misplaced.

Instead of defending their vague labels, Defendants insist that the
ITAR Scheme survives Plaintiff's vagueness challenge because it
contains "reasonably clear" exemptions. This approach virtually
concedes the vagueness of the ITAR Scheme's prohibitions. No authority
is cited for the proposition that a "reasonably clear" exemption can
save a vague law. On the contrary, vagueness doctrine has always
focused on defining what is prohibited. Individuals will "'steer far
wider of the unlawful zone'" unless "the boundaries of the forbidden
areas [are] clearly marked." Baggett v.  Bullitt, 377 U.S. 360, 372
(1964), quoting Speiser v. Randall, 357 U.S. 513, 526 (1958); Grayned,
408 U.S. at 108 (law is vague if "its prohibitions are not clearly
defined" because person "must know what is prohibited").

1. The "Public Domain" Exemption is Vague.

This fallacy need not be belabored further, however, for even the
exemptions are vague. The best example is again the public domain
exemption. As demonstrated above, Defendants' application of this
exemption depends on the vague distinction between technical data and
defense articles, and their false assertions that they leave the
determination of what the term includes and how it is applied to those
affected.

The public domain exception also creates a classic "Catch-22"
overbreadth problem. Information is in the "public domain" if it "is
published" and "is generally . . . available" to the public in any of
several ways. 22 C.F.R.  120.11. What does "is published" mean? Does it
include information that is being published at this very moment? Or is
it limited to information that is already published? One Congressional
committee clearly identified the ambiguity here:

	The status of technical data under ITAR is summarized this way
	in a National Telecommunications and Information Administration
	contractor's document:  'Therefore, if the information is
	unclassified, once published domestically it is no longer under
	the control of ITAR. The difficulty is that the act of
	publication domestically could be interpreted as a violation of
	the regulation.'

House Committee on Government Operations, The Government's
Classification of Private Ideas, H. Rept. No. 96-1540, 96th Cong., 2d
Sess. 107 (1981) (citation omitted).

If "is published" includes "will be published," PROF. BERNSTEIN would
be free to publish all his items - the Paper, the Snuffle source code,
and the Instructions - without a license. Information which will be
published and so made available would be in the "public domain" and not
subject to ITAR controls at all. 22 C.F.R. 125.1(a) ("information which
is in the public domain. . . is not subject to the controls of this
subchapter").  Unfortunately, the above interpretation is not
consistent with Defendants' actions. When PROF. BERNSTEIN asked for
permission to publish Snuffle, the State Department said no. The most
telling example is Plaintiff's conversation with Mr. Charles Ray, who
told him that placing information into a library where "anyone could
get it" could trigger prosecution under the ITAR. Bernstein Decl.,
paras. 24-25; see Junger Decl. paras. 9-16. Defendants obviously do not
give fair warning of what the ITAR Scheme controls and what it does
not, which discourages people from publishing.

The only reasonable conclusion is that Defendants equate "is published"
with "has been published." So construed, the "public domain" provisions
merely allow republication of old material and do not provide
protection for PROF.  BERNSTEIN and many others who intend to publish
new material. Defendants' extended discussion of how something might be
"generally available" therefore, misses the point.

2. The Academic Exemption Is Vague.

Plaintiff has already noted that the exclusion of "general scientific .
. .  principles commonly taught in schools, colleges, and universities"
from the definition of "technical data" is vague. Plaintiff's Motion at
35:10-36:16.  Declarant Lowell characterizes this language as "an
assurance to the academic community as to the general non-applicability
of the ITAR to a university setting." Defendants' July 25, 1996 letter
at 3. It should be obvious that Defendants' chosen phrase "general
non-applicability," still permits "specific" application, and so gives
no real assurance. Miller Decl., paras. 18-22, 40; Junger Decl., paras.
23-28.

More importantly, every time the ITAR Scheme is applied to the academic
setting, the State Department has, in fact, "substituted its judgment
for that of university or scientific scholar." It did so for Prof.
Bernstein, for Prof. Junger, and for Mr. Miller. Even when Defendants
do not apply ITAR, its existence produces self-censorship, as
illustrated by Dr. Blaze's experiences. Declaration of Matt Blaze,
paras. 13-15. The ITAR Scheme is enforced by uncertainty, not the rule
of law.

When the question of restraints on scientific publication arose during
congressional oversight hearings in 1981, the State Department offered
the "clarification" from the Munitions Control Newsletter, quoted above
at page 10. NRC Report 4-47. The House report issued as a result of
these hearings commented that this

	clarification . . . seems to clarify little while insisting
	that algorithms can be dangerous if they purport to have
	advanced cryptologic application. .  . . [and] place[s] the
	burden on the would-be (or unknowing) scientific exporter to
	find out whether the technical data and the setting require an
	export license. The researcher in cryptography stands at
	special risk of being found in violation of these export
	regulations, judged less by known enforcement activity than by
	the vagueness of the regulations and the National Security
	Agency's admonitions. . . .

H. Rept. No. 96-1540, at 68.

In fact, even Defendants' latest letter on the subject, sent to
Plaintiff with his brief, reveals that a license is still required, or
at a minimum that the answer is still unclear. First, Defendants state
that "Dr.  Bernstein does not have to register with this office merely
to publish a scientific paper that might contain this technical data.
Also, there is no requirement to register for merely teaching a class
on cryptography." Defendants' July 25, 1996 letter, page 3. Yet only
two paragraphs later, Defendants state "Dr. Bernstein would have to
register [as an arms dealer] only if he intends to . . . furnish direct
technical assistance to a foreign person to assist in their obtaining
or using a defense article." Defendants' July 25, 1996 letter, page 4.
If Plaintiff gives a foreign student his technical data in order to
assist them in understanding how Snuffle 5.0 works, is he "assisting
them in using a defense article" and so a license is required?

The Supreme Court's words in Keyishian v. Bd of Regents, 385 U.S. 589
(1987), might have been said about the ITAR Scheme. "It is no answer to
say that the statute would not be applied in such a case. We cannot
gainsay the potential effect of this obscure wording on 'those with a
conscientious and scrupulous regard for such undertakings.'" Keyishian,
385 U.S. at 599, quoting Baggett, 377 U.S. at 374. Like the
"complicated plan" in Keyishian, the "very intricacy" and "the
uncertainty as to the scope" of the ITAR Scheme's proscriptions "make
it a highly efficient in terrorem mechanism. .
. . The uncertainty as to the utterances and acts proscribed increases
[]
caution in 'those who believe the written law means what it says.'"
Keyishian, 385 U.S. at 601, quoting Baggett, 377 U.S. at 374.

C. The ITAR Scheme Lacks the Necessary Scienter for Civil and Criminal
Liability.

Defendants have argued that scienter cures the ITAR Scheme's vagueness.
That is wrong for two key reasons. First, 22 U.S.C.  2778 expressly
does not require scienter for civil liability. On the contrary, one can
unknowingly export technical data because "export" is defined as the
mere disclosure -- whether knowingly made or not -- of technical data
to a foreign person. Cf 22 U.S.C.  2778(c) and  2778(e). The Scheme
thus does not require knowledge that the person is foreign, or that the
scientific information is deemed "technical data" by Defendants.
Because scienter is necessary "to avoid the hazards of
self-censorship," Mishkin v. New York, 383 U.S. 502, 511 (1966), the
ITAR Scheme's lack of any scienter for civil liability is fatal. Cf.
New York Times Co. v. Sullivan, 376 U.S. 255, 277 (1964).

Second, the scienter requirement for criminal liability is also
insufficient. Generally, the purpose of criminal intent is to target
those "who understand the wrongful nature of their conduct." United
States v.  X-Citement Video, 115 S.Ct. 464, 469 n. 3 (1994). Where
protected speech is concerned, however, the First Amendment demands
that scienter carefully and specifically focus solely upon those who
have wrongful intent. For example, in reviewing the scienter of a
statute that punished dissemination of documents connected with the
national defense to an agent of a foreign nation, the Supreme Court
observed that because "[n]ational defense . . . is a generic concept of
broad connotations," the statute's prohibitions would have been vague
but for "[t]he obvious delimiting words . . . requiring intent or
reason to believe that the information to be obtained is to be used to
the injury of the United States, or to the advantage of any foreign
nation." Gorin v. United States, 312 U.S. 19, 26-28 (1941) (internal
quotation marks omitted); see United States v. Heine, 151 F.2d 813, 815
(2nd Cir. 1945) cert den., 328 U.S. 833 (1946) (discussing breadth of
"national defense"). Thus, where criminal liability is concerned, the
ITAR Scheme must at least contain the narrow scienter imposed in Gorin.
See Edler, 579 F.2d at 521 (citing Gorin). Courts have, however,
interpreted ITAR Scheme scienter so unclearly as to leave the publisher
of scientific information at peril. At least two circuits have held
that one need not specifically know that an export license is needed,
only that one has a duty not to export the articles. United States v.
Beck, 615 F.2d 441, 450 (7th Cir. 1980); United States v. Tsai, 954
F.2d 155 (3rd Cir. 1992) cert den. 506 U.S. 830 (1992).  Similarly, the
First Circuit has held that specific intent does not require "proof
that the defendant know the arms are on the [USML]." United States v.
Murphy, 852 F.2d 1, 7 n. 6 (1st Cir. 1988), cert den. 489 U.S. 1022
(1989)

But, because under the ITAR one's duty not to "export" is the same as
one's duty not to speak or publish without a license, speakers are not
sufficiently protected under Gorin. PROF. BERNSTEIN knew that the items
he submitted in his CJ request could be on the USML. What he did not
know with certainty, however, was whether the items were on the list --
or if they were, whether they were defense articles, technical data, or
subject to one of the exemptions. Whether information is in fact on the
USML, and whether one's communication is in fact an export, are "the
crucial element[s] separating legal innocence from wrongful conduct."
X-Citement Video, 115 S.Ct. at 469. Without knowledge of them, there is
no "purpose to disobey the law." Ratzlaf v. United States, 510 U.S.
135, 141 (1994) (quotations omitted). To be clear, scienter must
include knowing that what is done is unlawful or at least so wrong that
it is probably unlawful.

V. WITHOUT FURTHER SAVING CONSTRUCTION, THE ITAR SCHEME IS EITHER ULTRA
VIRES OR AN UNCONSTITUTIONAL DELEGATION OF LEGISLATIVE POWER.

Nothing in the statutory text or legislative history of 22 U.S.C.  2778
authorizes licensing of Plaintiff's speech. Properly construed, the
statute only authorizes regulation of commercial, military exports. See
22 U.S.C.  2794(7)("defense articles and defense services "with respect
to commercial exports subject to  2778).

Defendants argue that the authority to control arms exports "[i]n
furtherance of world peace and the security and foreign policy of the
United States," 22 U.S.C.  2778(a)(1), justifies their sweeping
regulations. But this argument proves too much. There are no limits on
what may be placed on the USML. 22 U.S.C.  2794(7). There is no
judicial review of Defendants' decision that something is on the USML.
22 U.S.C.  2778(h). Thus, with respect to speech, either the
regulations are ultra vires or the statute violates the nondelegation
doctrine.

A. The ITAR Scheme Is Ultra Vires.

1. Commercial Transactions: The Core Meaning of the AECA .

That Defendants' interpretation of the AECA extends well beyond the
plain meaning of the statute is easily seen in their extension of it to
noncommercial "exports, since this extension, if enforced, requires
that this Court ignore the very words of the statute. Settled law
provides that courts "will avoid a reading which renders some words
altogether redundant." Gustafson v. Alloyd Co., Inc., 115 S. Ct. 1061,
1069 (1995).

The AECA states that defense articles and defense services "means, with
respect to commercial exports subject to the provisions of section 38
of this Act [22 U.S.C.  2778], those items designated by the President"
as being on the USML. 22 U.S.C.  2794(7) (emphasis added). The phrase
"with respect to commercial exports" is superfluous, however, if the
statute is interpreted as reaching non-commercial matters. Yet this is
precisely what the ITAR regulations do. They reach all disclosures of
technical data and all "exports" of software, commercial or not, as
seen in Defendants' application to of the ITAR Scheme to Plaintiff, Mr.
Demberger, Mr.  Zimmermann, Mr. Miller and Professor Junger. Such
interpretation obviously violates "the settled rule that a statute
must, if possible, be construed in such fashion that every word has
some operative effect." United States v.  Nordic Village, Inc., 503
U.S. 30, 36 (1992).

Sec. 2778 provides further textual support for this construction,
because its terms assume that it applies only to commercial matters.
E.g., 22 U.S.C.  2778(b)(1)(A) (registration requirement for those "in
the business of manufacturing, exporting or importing"); 2778(g)(2)
(applicants must "identify . . . all consignees and freight forwarders
involved in the proposed export"); 2778(g)(9)(D) (defining "party to
the export" as "senior officers of the license applicant," "freight
forwarders or designated export agent," and "any consignee or end user
of any item to be exported").  To ascertain plain meaning, the court
may also analyze "the language and design of the statute as a whole."
K-Mart v. Cartier, Inc., 486 U.S. 281, 291 (1988). This analysis
reinforces Plaintiff's construction.  2778 is part of a law with a
clear, stated purpose: "Statutory requirements for controls over
commercial and government-to-government military exports are revised
and combined in a new Arms Export Control Act so that all military
export matters are controlled under one statute." S. Rep. No. 94-876 at
4.

Congress's main concern was to control government military exports such
as "grant military assistance" and "foreign military sales." H.Rep.
No.  94-1144, at 1-2, reprinted at 1976 USCCAN 1378, 1385-86. The prior
statutory framework for arms export, however, was also "outdated"
because it gave "complete discretion to the President" over
"[c]ommercial sales." S.Rep. No.  94-876, at 9 (quotation and citation
omitted). That the "sale of defense articles through commercial
channels is increasing each year" was one of five key conclusions
emphasized by the House. H. Rep. No. 94-1144, at 12, 1976 USCCAN at
1388. Thus, Congress sought to regulate "government-to-government
military sales," "sale of defense articles through commercial
channels," and defense services like "military training." Ibid

In short, AECA as a whole was intended to regulate
government-to-government and commercial military exports and  2778 is
the portion of the statute reaching the commercial military exports.
The caselaw supports this conclusion as well. Plaintiff is unaware of
any AECA case involving a noncommercial disclosure of information. The
Ninth Circuit construed the ITAR as "control[ling] the conduct of
assisting foreign enterprises to obtain military equipment and related
technical expertise." United States v.  Edler Industries, Inc., 579
F.2d 516, 521 (9th Cir. 1978). Edler specifically addresses
"transmissions of information in a commercial context." Id., at
519-520. Other cases have assumed that AECA/ITAR governs "commercial
export of arms and ammunition." United States v. Adames, 878 F.2d 1374,
1376 (11th Cir. 1989); United States v. Beck, 615 F.2d 441, 444 (7th
Cir. 1980) (same); see United States v. Evans, 667 F.Supp. 974, 982
(S.D.N.Y. 1987) ("exports, Government and commercial"); cf. United
States v.  Durrani, 835 F.2d 410, 420 (2nd Cir. 1987) ("foreign
military sales"). Thus, the plain meaning of  2778 and the caselaw
interpreting it exclude noncommercial speech such as Plaintiff's here.

2. AECA Does Not Apply to Domestic Speech.

The foregoing analysis also shows that AECA does not authorize control
of noncommercial speech. In addition, the AECA was also not intended to
apply to purely domestic speech, even if it is commercial. Simply put,
the AECA is about "export," a term applied to transborder transactions.
In 1978, the OLC stated that "further Congressional authorization would
obviously be necessary in order to extend governmental controls to
domestic as well as foreign disclosures of public cryptographic
information." Tien Decl. Ex.A, Bates #60088. In the absence of a
specific definition in the AECA, "export" must be construed "in
accordance with its ordinary or natural meaning. FDIC v. Meyer, 510
U.S. 471, 476 (1994).

"To export means to carry or send abroad; to import means to bring into
the country. Those acts begin and end at water's edge." Canton R.R. Co.
v.  Rogan, 340 U.S. 511, 515 (1951) (constitutionality of state tax
under the Import-Export Clause, U.S. Const., Art. I,  10, cl. 2).
Canton, while not directly on point, strongly suggests that disclosures
within the United States cannot be an export. At the very least, it is
not an export for Plaintiff to disclose technical data to a foreign
national within the United States; there is no "carry[ing] abroad," no
crossing of the "water's edge." See United States v. Posey, 846 F.2d at
1496-97 (contrasting "export abroad" with "domestic disclosure").

3. AECA Does Not Apply to General Publication.

Defendants' interpretation poses massive constitutional difficulties
mainly because the ITAR sweeps in as "export" the publication of
scientific and technical information. Although the Ninth Circuit sought
to limit the ITAR's reach in Edler, that effort failed, in part because
the Ninth Circuit did not analyze the issue of overbroad definition of
export in the ITAR Scheme.  The ITAR Scheme reaches any disclosure of
technical data to a foreign person, whether in newspapers, in books,
face to face or through the Internet. 22 C.F.R. 120.17(a)(4). This
definition on its face restricts freedom of expression. Lovell, 303
U.S. at 452 ("press in its historic connotation comprehends every sort
of publication which affords a vehicle of information and opinion.")

As Plaintiff has outlined above, neither noncommercial transactions nor
purely domestic speech are properly within the AECA's reach. But this
attempt at saving the AECA, if not the ITAR, does not protect the
author of a book; the worldwide sale of a book like Mr. Schneier's
Applied Cryptography could conceivably be considered a "commercial
export."

A clear statutory statement is a precondition of any authorization of
executive power to regulate First Amendment rights. Schneider v. Smith,
390 U.S. 17, 25-27 (1968); Greene v. McElroy, 360 U.S. 474, 507 (1959).
As the OLC noted that "it is by no means clear . . . that Congress
intended that the President regulate noncommercial dissemination of
information, or considered the problems such regulation would
engender." Tien Declaration, Ex. A, at Bates #60077. Prudential
considerations therefore dictate that the AECA does not apply to
general publication, because "where an otherwise acceptable
construction of a statute would raise serious constitutional problems,
the Court will construe the statute to avoid such problems unless such
construction is plainly contrary to the intent of Congress." Edward J.
DeBartolo Corp. v. Florida Gulf Coast Bldg & Constr Trades Council, 485
U.S.  568, 575 (1988).

B. As Interpreted By Defendants, The Scheme Violates The Non-Delegation
Doctrine.

Plaintiff here contends that the delegation by Congress in the AECA
contains standards to which Defendants have failed to conform.
Defendants appear to argue that the delegation of power to further
"world peace and the security and foreign policy of the United States"
is sufficiently broad to encompass their circular rules and their
various actions. If we accept Defendants contention, arguendo, then it
is clear that the delegation at issue here is impermissibly
standardless and thus unconstitutional. See A.L.A. Schechter Poultry
Corp. v. United States, 295 U.S. 495, 529-30 (1935); Panama Ref. Co.
v. Ryan, 293 U.S. 388, 421 (1935). World peace and national security
are goals, not standards which sufficiently mark the field within which
the bureaucrat is to act so that it may be known whether he has kept
within it in compliance with the legislative will. Yakus v. United
States, 321 U.S.  414, 425 (1944), compare Touby v. United States, 500
U.S. 160 (1991).  "While legislatures ordinarily may delegate power
under broad standards ..., [the] area of permissible indefiniteness
narrows ... when the regulation ...  potentially affects fundamental
rights like those protected by the First Amendment." United States v.
Robel, 389 U.S. 258, 274-75 (1967) (Brennan, J., concurring).
Obviously, the ITAR affects domestic speech.

To make matters worse, there is no judicial review of Defendants'
determinations that Snuffle 5.0 is a defense article or that the
Instructions are technical data. 22 U.S.C. 2778(h). "[T]he use of the
result of an administrative proceeding to establish an element of a
criminal offense is troubling." United States v. Mendoza-Lopez, 481
U.S. 828, 838 n.  15 (1987)(requiring collateral challenge to use of
fundamentally unfair deportation proceeding). There must be judicial
review "before the administrative order may be used to establish
conclusively an elelment of a criminal offense." Id. at 838.

Plaintiff has suggested various problems which must be addressed in
order to save the ITAR Scheme. But no saving construction can exist if
Defendants' view of the statute is acceptable because the definition of
"defense articles and defense services" in 22 U.S.C.  2794(7) would
then be wholly discretionary and judicial review of such determinations
would be precluded by 22 U.S.C.  2778(h). Defendants would retain (in
the AECA) the unreviewable discretion to decide what is controlled. For
this reason, the Court must either construe the AECA as regulating only
commercial, military exports or must invalidate both the ITAR and the
AECA on their face as excessive delegations of constitutional rights.

				 CONCLUSION

The ITAR Scheme must be judged by its own words and plain meaning and
by Defendants' real world actions and statements in applying it, both
to Plaintiff and to others. Defendants' would have this Court instead
base its judgment on post-litigation, often demonstrably false,
assertions about the scope, meaning and application of the ITAR
Scheme.

In sum, the ITAR Scheme is a a prior restraint on speech about
cryptography.  It censors that speech as technical data, as computer
code and as the very broadly defined non-code areas of the term
"software." It is content-based, is aimed at and applied to censor
communication and is so overbroad and vague that Defendants' themselves
don't even know its contours, much less the many private scientists,
academics and other citizens who face severe civil and criminal
penalties if they fail to abide by it.

The root of most of these problems can be summed up in a single word:
discretion. The ITAR Scheme, starting with the AECA, simply grants too
much discretion to Defendants, allowing them to extend the reach of the
Scheme well beyond its facial and intended purpose of controlling
commercial arms export, and into the realm of First Amendment protected
expression. Because of this discretion, the statute must be invalidated
on its face.

Based upon the foregoing, Plaintiff respectfully requests that
Defendants' Motion for Summary Judgment be denied and that Plaintiff's
Motion for Partial Summary Judgment be granted as described below:

1. Procedural Prior Restraint: Plaintiff contends that, to the extent
that it requires a license prior to protected expression, the AECA must
be invalidated on its face on the grounds that it fails to provide
adequate procedural safeguards required by Freedman v. Maryland and its
progeny.

2. Substantive Prior Restraint. Plaintiff contends that the ITAR must
be invalidated to the extent it censors "software with the capability
of maintaining secrecy, confidentiality or of information or
information systems" and related information ("speech about
cryptography"), on the grounds that the Government has failed to meet
its burden to show that "direct, immediate and irreparable damage" will
result from the communication of this protected expression.

3. Subsequent Punishment. Plaintiff contends that the standard of
strict scrutiny applies and that Defendants have failed in their burden
to show that, to the extent they extend to speech about cryptography,
the subsequent punishment provisions of the ITAR and AECA meet that
standard. Accordingly, each must be invalidated on its face.

4. Vagueness. Plaintiff contends that the AECA is vague in that it
fails to limit agency discretion to regulate protected expression. The
ITAR is also vague, as to the categories of "defense article," "defense
service" and "technical data", its exemptions, and its definition of
"export" among others, creating further confusion and a chilling effect
in practice. As a result, both the statute and the regulation must be
invalidated on their face and as applied to Plaintiff.

5. Overbreadth. Plaintiff contends that the ITAR is overbroad, both on
its face and as applied to Plaintiff, since it reaches a substantial
amount of First Amendment protected expression. As a result, the ITAR
must be invalidated on its face to the extent that it reaches such
protected speech or speech activities and invalidated as applied to
Plaintiff since his activities are non-commercial, academic
publication.

6. Ultra Vires or Unconstitutional Delegation of Power

To the extent that the ITAR Scheme includes regulation of noncommercial
speech, domestic speech, publication or scientific exchange, either the
ITAR regulations are ultra vires or the AECA has unconstitutionally
delegated discretionary authority over speech to Defendants. Plaintiff
believes that it is the former, and so contends that the ITAR must be
invalidated to the extent that it controls such speech. If the Court
determines that it is the latter, the AECA must be invalidated on its
face.

7. Immediate Effect

The Constitutional violations inherent in the ITAR Scheme continue
every day and both the direct actions of Defendants and their chilling
effect continues to harm the growth of the science of cryptography.
Plaintiff has now been restrained from his publication for over three
years and every day that this restraint continues, both he and the
science of cryptography are harmed, as the Declarations demonstrate.
Others are similarly being restrained. Further, Defendants are actively
and improperly using the ITAR Scheme to control the methods of
cryptography which are developed and used domestically. For these
reasons, Plaintiff respectfully requests that this Court both
invalidate the statute and regulations on their face and as applied,
and order that, pending the probable appeal of that decision,
Defendants are enjoined entirely from applying the ITAR Scheme in any
way to speech about cryptography, including source code.

Dated:___________________

Respectfully Submitted,

McGLASHAN & SARRAIL
Professional Corporation

CINDY A. COHN
Attorneys for Plaintiff
Daniel J. Bernstein