As David Hudak sits in a New Mexico jail accused of illegally purchasing and stockpiling warheads, his defense attorney takes aim at Halliburton Corp., which he said induced his client to buy the devices.
By Dan Shingler
Tribune Reporter
Canadian David Hudak sits in a New Mexico jail cell, accused of stockpiling U.S.-made missile warheads.
Federal prosecutors moved in on Hudak quickly after an informant alerted them to his activities last summer.
But his defense attorney wonders why the U.S. company that sold Hudak the devices has not been pursued with the same zeal, especially since prosecutors contend that the sale was illegal.
Hudak's attorney, Bob Gorence, said Hudak was induced to purchase the items by Halliburton Corp. - the major U.S. conglomerate once headed by Vice President Dick Cheney.
Gorence said Halliburton offered the warheads as legal "demolition charges," rather than government-owned military arms that he could not legally possess.
"David thought he was dealing with a reputable company that knew what it was doing, meaning Halliburton," said defense attorney Bob Gorence. "If you can't rely on what the vice president's company tells you - that these are demolition charges - then what's a Canadian to do?"
Cheney formerly served as Halliburton's chief executive officer, but did not take that post until 1995, the year after the warheads were sold to Hudak.
Hudak has been involved in a variety of activities ranging from commercial demolition work to the training of military and police units here and in Canada.
He said he purchased the warheads because Halliburton offered them at a bargain basement price of about $1 each.
Prosecutors and federal law enforcement officials say they are continuing to investigate who sold the warheads to Hudak, but have yet to publicly lay blame for the sale.
Industry and government officials say defense contracts prohibit the sale of such items "on the open market."
Prosecutors have also made it clear they believe the sale was illegal.
"The company that sold these warheads to Mr. Hudak did so illegally, knowing they were doing it illegally, and conspired to conceal that fact," assistant U.S. Attorney Greg Wormuth said at an April 1 hearing. He said the matter would be pursued further at Hudak's trial.
A November 2002 prosecutor's motion also questioned the legality of the sale.
"It is also worth noting that some, if not all, of the warheads seized in Roswell were property of the United States and that the United States appears to have never consented to the sale, release or transfer of those warheads. The United States is continuing its investigation into the transfer of the seized warheads as well as other munitions," the motion reads.
The U.S. Attorney's Office has declined to comment further or to elaborate on Wormuth's statement.
Exactly who sold the devices to Hudak may be a point of contention at Hudak's trial in August.
Gorence and Hudak claim the sale was initiated by Halliburton just before Halliburton sold its Texas-based subsidiary that made the shoulder-fired missiles, Jet Research Center, to Tennessee-based Accurate Arms Co. in 1994. They say the transaction was completed after the Jet Research acquisition, and Hudak ultimately completed the purchase with Accurate Arms.
Halliburton spokeswoman Wendy Hall said Halliburton sold other legitimate demolition devices to Hudak, but had no part in the sale of the warheads.
Hall said Halliburton has cooperated with investigators on the case, but did not expect legal action as a result of the matter.
Hall said it would be "inappropriate" for Halliburton to discuss the matter further.
Halliburton, a Houston-based company, is a major player in the oil and construction industry. The company this month was given a multimillion-dollar contract to help rebuild Iraq.
Officials of Accurate Arms did not return three telephone calls seeking the company's account of the alleged sale.
The file for Hudak's case includes numerous pieces of correspondence between Hudak and his companies and both Halliburton and Accurate.
Hall said Halliburton completed the sale of Jet Research on Feb. 9, 1994.
On that same day, a fax cover sheet from a Halliburton official to one of Hudak's companies refers to a pending sale of explosives as a "blue light special" and directs further inquiries to Accurate Arms.
The fax does not specifically state what explosives are being addressed, and Hudak has said he purchased numerous explosives from Halliburton, including legal demolition supplies.
Gorence said he believes Halliburton is hiding behind technicalities in claiming that it had no part in the sale.
"Obviously, I think they're running for cover under the guise that they may have sold (Jet Research) the night before," Gorence said. "It's ironic that Halliburton is not incriminated in any way (by prosecutors) or finds itself in any conspiracy charges."
Accurate Arms may face additional problems related to the warheads it received from Halliburton in the Jet Research sale.
At a Nov. 14, 2002, hearing in federal court in Albuquerque, U.S. Customs agent Tony Singleton said Jet Research actually transferred 6,000 of the warheads to Accurate Arms. Aside from the approximately 2,500 that were sold to Hudak, Accurate Arms can not account for the warheads, Singleton said.
The warheads were meant to be part of a weapons system known as a shoulder-launched multipurpose assault weapon, or SMAW, according to court documents.
In a March interview with Canada's W-FIVE news, Hudak said he paid approximately $3,000 for the approximately 2,500 warheads and in fact only paid for the boxes required to ship them and for the handling.
The warheads were quality assurance rejects from Jet Research that were deemed unsuitable for use in actual weapons, Hudak said.
Hudak, who remains in federal custody at the Torrance County Detention Facility in Estancia, could not be reached.
Regardless of who owned the warheads, they should not have been sold to a nongovernment entity, said Sam Russo, public affairs specialist for the Defense Contract Management Agency. The DCMA is in charge of overseeing defense contracts on behalf of the federal government.
"All of those explosive ordnance contracts have clauses that call for the contractor to demilitarize or destroy lots of explosive ordnance. They can't be sold on the open market," Russo said.
SMAW weapons systems are currently being manufactured by Talley Defense Systems of Mesa, Ariz., which court documents initially identified as the source of Hudak's warheads.
Talley, however, was not making the items in 1994 and had nothing to do with the sale of the SMAW warheads to Hudak, said Talley spokesman John Bednarz.
"There is no way we would ever sell anything to a member of the public or without Defense Department approval," Bednarz said.
At the time of his arrest, Hudak was involved in counterterrorism training near Roswell for soldiers of the United Arab Emirates.
Federal prosecutors claim that the devices have no legitimate civilian application and have successfully argued that Hudak should be held in jail until his trial in August.
He faces a minimum 50-year sentence on charges that include illegal possession of destructive devices and conspiracy to export defense services without a license.
Key Hudak case figures
David Hudak: A Canadian citizen from Vancouver, British Columbia, and a demolitions expert. His companies, here and in Canada, provide explosives and counterterrorism training to police and military personnel. He is charged with illegal possession of destructive devices, exporting defense services without a license and conspiracy. If convicted, he faces a minimum 50 years in prison.
Halliburton Corp.: A major U.S conglomerate and a major player in the international oil and gas industry. The company has also been involved in construction and defense contracting. Vice President Dick Cheney served as chief executive from 1995 to 2000, when he resigned to focus on the presidential election.
Jet Research Center: A former subsidiary of Halliburton based in Alvarado, Texas. Jet Research formerly had the contract to supply the U.S. military with Shoulder-fired Multipurpose Assault Weapons, or SMAW missiles. Hudak's attorneys claim the company initiated the sale of the SMAW warheads to Hudak.
Accurate Arms Co.: A McEwen, Tenn.-based company that manufacturers smokeless powder and explosives for both the military and civilian markets. Accurate purchased the assets of Jet Research Center from Halliburton in 1994. Court documents show that Hudak ultimately purchased the SMAW warheads from Accurate Arms.
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