Toshiba’s Purchase of Firm Is Denounced

The sale of a General Atomics subsidiary to Toshiba, a Japanese firm that sold secret defense technology to the Soviet Union, drew harsh criticism Tuesday from Rep. Duncan Hunter, R-Coronado.

General Atomics, one of San Diego’s largest defense contractors, announced Monday it was selling 51% of its Applied SuperConetics subsidiary to Toshiba America Medical Systems.

Applied SuperConetics, a 20-person firm with annual sales of $6 million, manufactures superconducting magnets for medical imaging companies.

Toshiba was accused in 1987 of violating a treaty with the United States by selling a metal-milling machine to the Soviet Union that will allow Soviet submarines to operate more quietly and increase their ability to escape detection by U.S. forces.

Hunter led congressional criticism of the sale and called for a permanent boycott of Toshiba products in the United States. He revived that campaign Tuesday after learning of the sale of SuperConetics to Toshiba, which last year had U.S. sales of about $3 billion.

“Toshiba should never be allowed to do business in the United States again. Period,” Hunter said in a telephone interview from his Washington office.

“They violated critical technology transfer regulations. The damage they did was irreparable,” said Hunter.

The congressman estimated the Toshiba sale to the Soviets advanced their submarine technology by six to 10 years and would eventually cost the U.S. more than $30 billion to counteract.

Toshiba’s president resigned in 1987 after he admitted selling the forbidden technology to the Soviets. As a result of the sale, Toshiba was banned from selling products to the U.S. government until 1991.

According to Hunter, Toshiba escaped a more severe punishment by spending $20 million on U.S. lobbyists in Washington.

Local executives of Toshiba and General Atomics said they were surprised at Hunter’s criticism and emphasized that Applied SuperConetics is not a Pentagon supplier.

“Toshiba makes lots of other things besides defense products,” said Doug Fouquet, a General Atomics spokesman.

Takashi Hayashi, president of Toshiba’s U.S. subsidiary, said the sale would have benefits to American consumers and added, “We have been punished enough already.”

But according to Hunter, Toshiba is still selling high-tech goods to American adversaries.

“Toshiba was one of the major contractors at a bomb factory in Libya,” Hunter said. “They think they can violate rules by spending big money on lobbyists. But they should be barred from the U.S. market permanently.

“As we can see from the recent indictment of the Iraqis for trying to acquire nuclear triggers, hundreds of American firms are being asked to sell out the security of the West. If we don’t punish them, there will be no deterrence,” Hunter said.