Sherry Chen v. United States

In 2012, the Commerce Department’s internal security unit, known as the Investigations and Threat Management Service (ITMS), began unlawfully investigating Ms. Chen as part of a broad pattern of discrimination directed at Chinese Americans, leading to her baseless arrest and prosecution by the FBI and Justice Department. ITMS was officially disbanded last year, following a Senate report detailing how the unit had become a “rogue, unaccountable police force” that operated outside the law and “opened frivolous investigations on a variety of employees without evidence suggesting wrongdoing.”

Based on ITMS’s improper investigation of Ms. Chen, the Justice Department charged her with making false statements to government investigators and unlawfully downloading data from a restricted government database. The government’s unfounded allegations rested on Ms. Chen’s use of a shared, office-wide password to access a database relevant to her work. The Justice Department eventually dropped all charges in 2015, but not before Ms. Chen was publicly arrested in front of her colleagues and faced 25 years in prison and $1 million in fines. The Commerce Department also fired Ms. Chen from the job she had worked at for years. After a federal administrative judge found that her termination was unlawful, and that Ms. Chen had been the victim of a “gross injustice,” the department appealed and placed her on indefinite leave. That appeal was still pending before the Merit Systems Protection Board prior to Ms. Chen’s settlement.

In 2019, Ms. Chen, represented by Peter Toren and Michele Young, filed a civil suit against the U.S. government, seeking accountability for its wrongful prosecution. The ACLU and Cooley LLP joined the legal team in 2021. Shortly after, Ms. Chen filed a new administrative complaint against the Commerce Department and Justice Department for intrusion into private affairs, negligent training and supervision, false arrest, intentional and/or negligent infliction of emotional distress, and civil conspiracy.

In December 2022, the parties reached a historic settlement — one of the largest paid to an individual plaintiff in Commerce Department history. Ms. Chen will receive $550,000 from the Commerce Department and an annuity from the U.S. government valued at $1.25 million over 10 years. The Commerce Department will host a private meeting between Ms. Chen and a senior National Oceanic and Atmospheric Administration official, where she plans to discuss wrongdoing at multiple levels of the agency and the importance of antidiscrimination reforms. The Commerce Department will also provide Ms. Chen with a letter acknowledging her extensive accomplishments during her years of service as a government hydrologist.