LOS ANGELES : Judge Dismisses Charges in IBM Computer Deal

A federal judge Tuesday dismissed wire fraud charges against two men accused of bilking the world's biggest computer company out of $300,000 by shipping a sophisticated computer system to Iran.

U.S. District Judge Edward Rafeedie threw out the charges against Reza Zandian, 41, of Irvine, and Charles Reger, 58, of Huntington Beach.

Prosecutors alleged that Zandian and Reger bought a $1.2-million computer from International Business Machines Corp. and got a $300,000 discount because the seller believed the buyers planned to use the system themselves. But Rafeedie, acting on a defense motion, found there was insufficient evidence to send the case to a jury.

The judge's decision marked the final stage in a slowly crumbling case against the two men, who were indicted Jan. 22 for violating export laws and lying to the U.S. Customs Service. Prosecutors dropped those charges last week, apparently for lack of evidence, so that the men were facing single counts of wire fraud.

In granting the defense motion, Rafeedie called the remaining counts a "desperate attempt" by the government to salvage its case. Reger said the judge "basically said this is crap. That's what it boils down to." Los Angeles attorney Alan Rubin, who represented Reger, said Rafeedie's decision "took a lot of courage."

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