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Judicial Watch • Chinagate



FEBRUARY 02, 2012

Meng v. Schwartz

Judicial Watch filed this important political corruption lawsuit on behalf of shareholders of a well-connected U.S. corporation that transferred sensitive U.S. missile technology to China in the 1990s. From approximately 1994 to 1998, Bernard Schwartz, who was the chairman of Loral Space & Communication Ltd., became the single largest donor to the Democratic Party by making contributions totaling approximately $1.5 million to various Democratic Party entities, including President Clinton’s 1996 reelection campaign.

During this same time period, Schwartz and Loral also persuaded the Clinton Administration to transfer technology export licensing authority from the State Department to the more politically-influenced Commerce Department. Schwartz and Loral then obtained licenses from the Commerce Department that were needed to launch Loral-manufactured communications satellites into orbit from China.

Congressional and other related investigations subsequently found that, when a Chinese rocket attempting to launch a Loral-manufactured satellite failed, Loral helped China to identify the cause of the failure, thereby advancing China’s missile program and threatening U.S. national security. Loral subsequently paid a $14 million fine relating to this transfer of sensitive U.S. technology.

Judicial Watch’s shareholder lawsuit sought to hold Schwartz and the Clinton Administration accountable under federal racketeering law, arguing that Schwartz’s campaign contributions constituted a form of bribery. The lawsuit ultimately did not go forward, but it succeeded in bringing additional public scrutiny to this very serious case of political corruption.

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Official Legal Documents

Litigation Documents

  • Complaint - This is a shareholder derivative action brought pursuant to Rule 23.1 of the Federal Rules of Civil Procedure for recovery by and on behalf of Loral Space and Communications, Ltd...
  • Plaintiffs' Opposition to the President and Mrs. Clinton's Motion to Dismiss - "The Amended Complaint alleges that Hillary Rodham Clinton devised, agreed to participate in and implemented this unlawful scheme, and that President Clinton and Vice-President Al Gore authorized, agreed to participate in, and also implemented the scheme."
  • Plaintiffs' Opposition to Defendant Terrence R. Mcauliffe's Motion to Dismiss - Judicial Watch's motion stating that the plaintiffs do not allege that McAuliffe participated in the operation or management of Loral. They do allege that McAuliffe conspired with others, including Loral Chairman and CEO Bernard L. Schwartz.
  • Plaintiffs' Opposition to Defendant John Huang's Motion to Dismiss - "The Amended Complaint alleges that Defendant John Huang, 'who was Deputy Assistant Secretary for International Economic Policy at the Commerce Department before transferring to the D[emocratic] N[ational] C[ommittee], also agreed to participate in the scheme and, with the assistance of other Commerce Department officials . . . participated in planning and implementing the Commerce Department's trade mission to China and other countries.'"
  • Plaintiffs' Opposition to Defendant Marvin Rosen's Motion to Dismiss - "The Plaintiffs' conspiracy claim is that Defendants, including Rosen, agreed to participate in this unlawful bribery scheme, and that Schwartz committed repeated, overt tortious acts in furtherance of the scheme by making payments in excess of $1,460,000, to the DNC and other organizations affiliated with the Democrats and the Democratic Party in exchange for taxpayer-financed government services and other favorable treatment for Loral."
  • Sandy Berger sued over Chinagate - Berger added to list of defendants in Loral/Chinagate suit. Read amended complaint here.

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