3 Charged With Plotting to Sell ‘Star Wars’ Technology to Soviets

Federal law enforcement authorities arrested three men and seized computer designs Thursday in what allegedly was a plot to sell “Star Wars” technology to the Soviet Union for $4 million.

The three are alleged to have conspired with Charles McVey, 57, who was arrested in August after spending four years as a fugitive. Authorities said the mastermind of the plot was McVey, a former Anaheim aerospace entrepreneur who was indicted in 1983 on separate charges of selling millions of dollars worth of sensitive satellite technology and other equipment to the Soviet Union.

McVey was arrested in Vancouver, Canada, and is in custody there.

In the latest case, the FBI, Customs Service and other agencies said McVey was arranging with three Silicon Valley men to obtain designs for use in a high-speed supercomputer that could have been the “brains” of a Star Wars defense system.

“What they had was state of the art, very much advanced, and if it had been transferred to the Soviet Union could have created a serious compromise of any SDI (Strategic Defense Initiative) system,” U.S. Atty. Joseph Russoniello said.

In the Star Wars system being researched by the United States, a supercomputer theoretically would receive data about incoming missiles from sensors and then transmit directions to defensive weapons that would destroy incoming warheads.

“This is the most significant case U.S. Customs has worked on,” said Rollin Klink, special agent in charge for the U.S. Customs Service. “It makes us feel good we stopped this stuff from leaving the United States. It would have severely damaged our military.”

The design for the computer, MATRIX 1, was stolen from its manufacturer, Saxpy Computer Corp. of Sunnyvale, which helped in the investigation.

Ivan Batinic, 29, a software engineer at the company, was arrested on charges of stealing the machine’s design.

FBI officials here said the MATRIX 1 computer can receive and analyze information faster than Cray computers, the machines in use at Lawrence Livermore National Laboratory, which is conducting the bulk of the nation’s Strategic Defense Initiative research program.

“He knew how it worked and all he had to do was to take the stuff off the tapes. The tapes are the key. That was the logic of the machine,” Saxpy spokesman Sandy Towle said.

Brother Arrested

Batinic’s brother, Stevan, also was arrested, as was Kevin E. Anderson, 36, a software designer from Fremont, Calif. All three made brief appearances in federal court in San Jose on Thursday. An indictment was expected to be returned by early next month.

Ivan Batinic also allegedly stole tapes, floppy disks and operating manuals, which were seized in Anderson’s storage locker in Fremont. The computer technology is not classified and has non-military applications. Towle said, however, that it could be used to analyze data picked up by sensitive underwater listening devices that track submarines.

The case began in August when Anderson and Ivan Batinic were caught at the U.S. border at Vancouver carrying $10,000 in $100 bills that were traced to McVey, who had been using the alias Carlo Julian Williams when he was arrested.

Components Delivered

Some materials were passed to McVey by Anderson and Ivan Batinic, though the FBI did not say whether any of the items ended up in the Soviet Union.

McVey, who describes himself as a physicist, lived in Villa Park in Orange County and owned high-technology businesses in Anaheim before being indicted in 1983 on charges that he illegally exported sensing equipment to the Soviet Union.

He was said to have boasted of being royally treated on trips to the Soviet Union and of dining with the late Soviet leader Leonid I. Brezhnev. He managed to continue his export business to the Soviet Union from Switzerland, where he lived after leaving Orange County in 1982.