Cybertheft Unresolved, Software Firm Leaving O.C.

Pat Clawson recited the familiar refrain of excessive taxes and the high cost of living as reasons for his tiny company’s decision to move to a town in rural Virginia.

But Clawson, chief executive of TeleGrafix Communications Inc., added a new lament: lack of cooperation from local law enforcement agencies.

Clawson said Monday that he is moving his software company from its Huntington Beach headquarters this week partly because local authorities refused to take action after some of the firm’s computer secrets were illegally posted on computer bulletin boards last summer.

“This was just the final straw,” Clawson said. The posting “has cost us hundreds of thousands of dollars in lost sales. But Huntington Beach police and local authorities could not be bothered on this kind of case.”

Police Det. David Goss said police didn’t pursue the case because the person suspected of posting the secrets appears to have done so from a computer in Torrance, outside his department’s jurisdiction.

“We can’t prosecute a case where the crime occurs in a different county,” Goss said. “We did everything we could. Half the departments in Los Angeles or Orange County wouldn’t have even taken the report.”

Either way, Clawson and the 10 employees of TeleGrafix are loading up the company’s equipment and moving to Winchester, Va., a town about 70 miles west of Washington.

The case involves a formula TeleGrafix developed for compressing video images and converting them to text files so they can be shipped over telephone lines at rapid speeds.

Clawson said that last summer, the formula began appearing on computer bulletin boards that were accessible to thousands of computer users.

Police in Pennsylvania, where one of the bulletin boards was based, traced the postings to a TeleGrafix customer in Torrance, officials said. But that put the matter beyond the reach of Orange County law enforcement agencies, and Clawson said that authorities in Los Angeles County also refused to pursue it.

Goss said that is understandable, given the often frustrating realities of computer crime. High-tech cases are difficult to investigate, he said, and even the successful ones often end in light sentences.

“It’s essentially just a hacker fooling around,” Goss said of the TeleGrafix suspect. “He didn’t gain from it. So you’re looking at a misdemeanor, and there’s virtually no penalty for it.”

Clawson could have filed a civil suit against the suspect, whom he declined to name, but decided against it because, he said, “small companies can hardly afford that kind of legal expense.”