U.S. Department of Justice “China Initiative” started during Obama administration

1) Charges against Reddy Annappareddy dismissed with prejudice

2) Indictment of Prof. Xiaoxing Xi dismissed

3) Indictment of Sherry Chen dismissed

4) Indictments of Guoqing Cao and Shuyu “Dan” Li dismissed

5) Unjustified indictment of Chunzai Wang

6) Unjustified indictments of Szuhsiung “Allen” Ho and Ching Ning Guey

7) Mingqing Xiao acquitted, convicted of minor tax reporting infractions, sentenced to probation

1) Indian-American Reddy Annappareddy was found guilty but then discovery of government misconduct resulted in dismissal of the charges with prejudice.

Sandra Wilkinson, head of the major crimes section, U.S. Attorney’s Office for the District of Maryland
Maura Lating, FBI agent
Rod J. Rosenstein, United States Attorney for the District of Maryland
Douglas F. Gansler, Maryland Attorney General
Stephen E. Vogt, Special Agent in Charge, Federal Bureau of Investigation
Drew Grimm, Special Agent in Charge, Office of Personnel Management, Office of Inspector General
Nicholas DiGiulio, Special Agent in Charge, Office of Investigations, Office of Inspector General of the Department of Health and Human Services
Lynne M. Halbrooks, Acting Inspector General, U.S. Department of Defense, Office of Inspector General

5/6/17 NPR: “This Was a Colossal Screw-Up’: A Close Look At A Case Dismissed For Misconduct”
by Carrie Johnson

9/6/16 Baltimore Sun: “Judge dismisses insurance fraud case against Fallston resident, pharmacy owner”

2) Indictment of Prof. Xiaoxing Xi dismissed

Zane D. Memeger, U.S. Attorney, Eastern District of Pennsylvania (Philadelphia)
Edward J. Hanko, FBI Special Agent-in-Charge
Jennifer Arbittier Williams, Assistant United States Attorney
May 2015: indicted Prof. Xiaoxing Xi for sending schematics of “pocket heater” to China.  Did not consult with experts before taking the case to a grand jury.  Schematics were not a “pocket heater”.
September 2015: charges dismissed

7/13/17 press release: Professor Xiaoxing Xi, a renowned American scientist and the former chair of the physics department at Temple University, was falsely accused of spying for China.  Professor Xi and his family have sued the government for, among other things, malicious prosecution and for violating the Fourth Amendment of the Constitution with illegal searches and seizures of their property, including unlawful searches pursuant to FISA orders. The complaint alleges that the government was motivated because of Professor Xi’s race and national origin and violated his right to equal protection of the law under the Fifth Amendment. In the complaint, Professor Xi and his family allege that the agents knew, or recklessly disregarded, that he had never sent sensitive information to colleagues in China, yet still persisted in initiating the prosecution against him. As a result, Professor Xi was threatened with a conviction that could have resulted in up to 80 years of incarceration and a fine of up to $1 million.

5/15/16: 60 Minutes: Collateral Damage

5/14/2016 Huffington Post: “Racial Profiling: Doing Science While Asian American”
by Frank H. Wu
In the past two years, the federal government has twice targeted Asian immigrants for prosecution with sensational allegations that they were spies, only to be embarrassed by the cases turning out to have no basis whatsoever. The federal government rarely sees its criminal cases disintegrate in such absolute terms, but it possesses the power to ruin the lives of naturalized citizens. Both Xiaoxing Xi, chair of the physics department at Temple University, and Sherry Chen, a mid-level civil servant with the National Weather Service, vindicated themselves through exhaustive struggles. The CBS News program Sixty Minutes has produced a segment about their fight for justice.

5/4/16 Los Angeles Times: “Op-Ed: Is racial bias to blame for the high number of Asian Americans charged with espionage?”
by George Koo, Daniel Olmos
In recent years, federal prosecutors have brought a number of high-profile criminal cases against Asian Americans accused of economic espionage or theft of trade secrets. Announced with great fanfare, many of these cases later collapsed.

11/25/15 San Francisco Weekly: “The Dangers of “Downloading While Asian””
By Yael Chanoff
In the early morning of May 21, Xiaoxing Xi, his wife, and their two daughters were awakened when a dozen FBI agents stormed their house in Penn Valley, Pa., a suburb 10 miles north of Philadelphia. The agents, dressed in SWAT gear with guns drawn, arrested Xi as his wife and daughters looked on.

11/23/15 press release: “U.S. Commission on Civil Rights Requests Department of Justice Investigation Into Recent Questionable Prosecution of Chinese American Scientists”
Washington, /PRNewswire-USNewswire/ — The U.S. Commission on Civil Rights, by majority vote, has issued a letter to Attorney General Loretta Lynch concerning targeting of Chinese American scientists for alleged spying and espionage. The Commission’s letter expresses concern that the government may be failing to exercise sufficient due diligence when targeting Chinese Americans. The Commission letter requests that the Department of Justice increase training and oversight in ongoing and future investigations and prosecutions.
According to a recent article in Science magazine, in the past year, five Chinese-born scientists have been accused of trade secret theft or economic espionage, only for the federal government to drop the charges after recognizing mistakes and insufficient or nonexistent evidence. In the case of Temple University professor Xi Xiaoxing, prosecutors arrested Dr. Xi for sharing confidential laboratory equipment schematics but dropped the charges after scientists informed the government the plans he shared were for a different technology. Although charges were dropped, the accused were left with tarnished reputations and legal bills to pay.
These prosecutions have harmed the individual scientists and their families and caused concern in the Asian American community about unfair treatment and racial profiling.
Commission Chairman Martin R. Castro on behalf of a majority of the Commission stated, “While combating spying and economic espionage is vital to our national security, just as important are the protections of our civil rights and civil liberties. American citizens are entitled to due process and should not be targeted on the basis of their race or ethnicity—that is un-American.”
The U.S. Commission on Civil Rights is an independent, bipartisan agency charged with advising the President and Congress on civil rights matters and issuing a federal civil rights enforcement report. For information about Commission’s reports and meetings, visit http://www.usccr.gov.

11/19/15 Vice News: “Why Does the FBI Keep Arresting Asian-American Scientists?”
By Avi Asher-Schapiro
Last May, Dr. Xiaoxing Xi awoke to find a team of FBI agents brandishing guns and screaming at him to put his hands behind his back. Agents slammed the 57-year-old Temple University physics professor against a wall and dragged him away in handcuffs — all in front of his wife and two daughters.

11/12/15 Washington Post: “Chinese-Americans are being caught mistakenly in the U.S.’s cybercrime dragnet”
By Peter Zeidenberg
Peter Zeidenberg is a partner in the white-collar and investigations practice at the Arent Fox law firm in the District and represented both Xiafen “Sherry” Chen and Xiaoxing Xi.
News item: Xiafen “Sherry” Chen, a Chinese American hydrologist at the National Oceanic and Atmospheric Administration, is arrested at her office; the U.S. government accuses her of illegally accessing data at the behest of Chinese officials; less than a week before going to trial, the government drops all charges.
News item: Xiaoxing Xi, Chinese American chairman of the physics department at Temple University, is arrested at his home in front of his wife and children by a dozen armed agents; the government accuses him of helping the Chinese by providing them with proprietary materials owned by a U.S. company; all charges are dismissed after a PowerPoint presentation that includes affidavits from prominent physicists makes clear that no crime was committed.

9/15/15 New York Times: The Rush to Find China’s Moles
By The Editorial Board
Feeling besieged by China’s spies, who have had success in stealing government and corporate trade secrets, the United States has ramped up its efforts to find moles. In at least two recent cases, however, F.B.I. agents and federal prosecutors appear to have acted with reckless haste.
On Friday, prosecutors dropped wire fraud charges filed in May against Xi Xiaoxing, the chairman of Temple University’s physics department. He was accused of sharing privileged technology with China and faced up to 80 years in prison.
Prosecutors said Dr. Xi provided the design of an item known as a pocket heater, used in superconductor research. The allegation fell apart after defense lawyers pointed out that the government had grossly misread the evidence it used to secure an indictment. As it turned out, Dr. Xi, a naturalized American citizen, had emailed scientists in China information unrelated to the pocket heater.
The embarrassing blunder came a few months after federal prosecutors in Ohio dropped charges against another Chinese-American professional, Sherry Chen, a National Weather Service employee who was also suspected of being a Chinese mole. She was charged with four felonies, including unlawfully downloading information about critical infrastructure. Her problems began after a colleague reported that she had emailed an official at China’s Ministry of Water Resources. The colleague had been copied on the email and found it suspicious.
The email was Ms. Chen’s response to a question from a Chinese official who had asked her during a meeting in Beijing how water infrastructure projects in America were funded. The information she gave him was harmless and publicly available.
China was reportedly behind a huge breach of the servers of the Office of Personnel Management, which could well give Beijing valuable information about millions of Americans who have been granted security clearances. Further, the theft of proprietary technology poses a considerable threat to the American economy. It is hardly surprising that the Justice Department has given priority to prosecuting espionage cases involving China.
But these concerns cannot justify prosecutions driven by supposition rather than solid evidence. The charges filed against Mr. Xi and Ms. Chen traumatized them and their families and needlessly damaged their professional reputations. Nether got an explanation or an apology from the government. They deserve both.

3) Indictment of Sherry Chen dismissed

Carter M. Stewart, United States Attorney for the Southern District of Ohio
Kevin R. Cornelius, Special Agent in Charge for the FBI in Cincinnati, Ohio,
Dr. Kathryn Sullivan, Administrator of the National Oceanic and Atmospheric Administration’s (NOAA)
George Lee, Special Agent in Charge of the U.S. Department of Commerce’s Investigations and Threat Management Division
Dwight Keller, Assistant United States Attorney
Laura K. Furgione, Deputy Director of the National Weather Service (Fired Sherry Chen Even After Indictment Dismissed)

October 2014: indicted Sherry Chen, NOAA National Weather Service employee for downloading restricted government files for China.
March 2015: charges dismissed.

Donate to her legal defense fund at https://www.sherrychendefensefund.org/

5/9/15 New York Times: “Accused of Spying for China, Until She Wasn’t”

5/24/18 Huffington Post: “Asian-American Caucus Demands Investigation After Chinese-American Scientist Accused Of Spying”

9/15/15 New York Times: “Chinese-American Cleared of Spying Charges Now Faces Firing”

5/15/16 Wall Street Journal: “Fired Worker Files Complaint After Spy Case Dropped”

4/26/18 Press Release: “OCA Applauds Sherry Chen’s Victory”
Contact: Thu Nguyen | Communications Associate
Washington, DC – OCA – Asian Pacific American Advocates celebrates Sherry Chen’s resilience and her victory against implicit bias and the US Department of Commerce (DOC). On Wednesday, April 25th, Chief Administrative Judge Michele Szary Schroeder ruled that the DOC had to reinstatement her job and give her back pay.
Sherry Chen was wrongfully arrested and accused in October 2014 of espionage. Despite the Department of Justice dropping all charges against her, the DOC still terminated her job at the National Weather Service in 2016. The judge in Chen’s recent caseconcluded that she was the “victim of a gross injustice,” citing the DOC’s investigation methods, filing for Chen’s termination, as well as “digging their heels” in order to “[be] right than doing the right thing.” OCA has supported Ms. Chen since the early days of the accusations, participating in press conferences with elected officials and inviting her to speak at the organization’s annual conference.
“Sherry Chen was the victim of racial profiling and further victimized by the Department of Commerce in spite of her innocence. Her resilience has proved the FBI, Department of Justice, and DOC wrong in their cases against her. But she is only one of a number of Chinese Americans who have been falsely accused of espionage,” said Ken Lee, OCA National CEO.“Following FBI Director Wray’s racially ignorant remarks that all Chinese students and scholars pose intelligence risks, we remain concerned that explicit and implicit bias against Chinese Americans will lead to more unfounded cases against our communities. Director Wray must meet with Asian American community leaders to ensure that cases like Ms. Chen’s never happen again.”
OCA-Asian Pacific American Advocates is a national organization of community advocates dedicated to improving the social, political, and economic well-being of Asian American Pacific Islanders (AAPIs).

4) Indictments of Guoqing Cao and Shuyu “Dan” Li dismissed

U.S. Attorney Joe Hogsett (Southern District of Indiana)
Cynthia A. Ridgeway, Assistant United States Attorney
Bill Heath, head of global product development for Eli Lilly
October 2013: indicted them for stealing trade secrets and sending them to China.  Not actually trade secrets.
December 2014: charges dismissed

12/5/14 Indianapolis Star: Feds dismiss charges against former Eli Lilly scientists accused of stealing trade secrets
by Jeff Swiatek and Kristine Guerra
The U.S. attorney’s office is asking a federal judge to dismiss all charges filed against two former Eli Lilly and Co. scientists accused of stealing company trade secrets and passing them on to a competitor in China.

5) Unjustified indictment of Chunzai Wang

Benjamin G. Greenberg, United States Attorney for the Southern District of Florida
Michael Walleisa, Assistant United States Attorney
Andrew Lieberman, U.S. Department of Commerce (DOC) Special Agent
George Lee, Special Agent in Charge, U.S. Department of Commerce (DOC), Investigations and Threat Management Division
Duane Townsend, Special Agent in Charge, U.S. Department of Commerce, Office of Inspector General (DOC-OIG),
Robert F. Lasky, Special Agent in Charge, Federal Bureau of Investigation (FBI), Miami Field Office

February 27, 2018

The Honorable Judy Chu, Chairwoman
2423 Rayburn House Office Building
Washington, D.C. 20515

The Honorable Madeleine Bordallo, Vice Chair
2441 Rayburn House Office Building
Washington, D.C. 20515

The Honorable Ted Lieu, Whip
236 Cannon House Office Building
Washington, D.C. 20515

Re: Chunzai Wang and the Targeting of Chinese-American Scientists

Dear Chairwoman Chu and Members of the Congressional Asian Pacific American Caucus:

Just over a week ago, FBI Director Christopher Wray testified before Congress that he believed that Chinese-American scientists all over the United States were covertly gathering intelligence on behalf of China.  Director Wray’s testimony makes clear that the Department of Justice is now waging a war against Chinese-American scientists— a war driven in large part by ignorance and paranoia.  And as in any war, there will, inevitably, be many innocent victims.  Dr. Chunzai Wang is one of those victims: collateral damage in a recklessly waged war against Chinese-born scientists.

First, a little history is in order.

In October 2014, Sherry Chen, a highly distinguished hydrologist at National Oceanic and Atmospheric Administration (NOAA), was arrested at her office, in front of her co-workers, and led away in hand-cuffs.  The government alleged that Ms. Chen, a naturalized American citizen, had illegally accessed data at the behest of Chinese officials and that she had lied to cover up this “crime.”  One week before trial, the government’s case collapsed, and it dismissed all charges against Ms. Chen.  Nevertheless, the effects of the arrest were devastating for Ms. Chen who, despite the dismissal, lost her job and has been forced to sue in order to be reinstated.

Six months later, in 2015, Professor Xiaoxing Xi, a world-renowned physicist at Temple University was arrested in front of his wife and children by a dozen armed agents, and similarly taken away in hand-cuffs.  He was accused of helping the Chinese by providing them with proprietary materials owned by a U.S. company.  The charges were later dismissed after it was established that the materials Dr. Xi sent were completely unrelated to the proprietary information.

Rather than being chastened by these experiences, the Department of Justice is still unfairly targeting Chinese-American scientists.  Chunzai Wang is one of the world’s foremost experts on climate change and hurricanes.  A naturalized U.S. citizen, he was, by far, the most prolific and successful climate scientist at NOAA Atlantic Oceanographic and Meteorological Laboratory, and was named the NOAA Employee of the Year in 2012.

In 2016, Department of Commerce (DOC) Special Agent Andrew Lieberman― the same agent that investigated Sherry Chen ― executed a search warrant at Dr. Wang’s home and office, and, just like in Ms. Chen’s case, interrogated Dr. Wang for an entire day, without counsel and without a food or water break.  As a result of the search warrant, the interrogation, and the negative publicity, Dr. Wang felt compelled to resign from NOAA, a position that he loved and where he worked tirelessly for 17 years.  With no other work alternative available at the time, Dr.

Wang left his family in Miami and found work at the Chinese Academy of Sciences in China doing similar research regarding climate change.

Last September, as he returned to the U.S. to visit his family, the government arrested Dr. Wang at the airport.  The government alleged that Dr. Wang committed time and attendance fraud when he spoke at scientific conferences in China without first notifying his supervisor, and that he illegally supplemented his income―Dr. Wang was a Guest Professor at the Ocean University of China and, while he was on annual leave, was paid a small fee per diem for mentoring students and helping them with their research.

On the brink of trial, the government offered Dr. Wang a deal: a plea to a single count of supplementation of income from Changjiang Scholars Program, with a sentence of “time served” (he spent one night in custody when he was arrested); no probation, no fine, no restitution; and, most significantly, no crushingly expensive three-week long trial which he could only have afforded by borrowing from his elderly parents and other family in China.  The plea meant that Dr. Wang could protect his family from the debilitating stress and immediately return to China and resume his research.

The presiding judge, Cecilia Altonaga, made clear her displeasure with this prosecution.  After hearing the facts of the government’s case, the judge stated that her “only regret . . . is that I have to adjudicate [Dr.] Wang.”  The judge went on to observe that while she knew “the Government has dismissed a number of counts in the indictment in exchange for the plea to Count 6, [ ] given the nature of [Dr.] Wang’s contributions to an area that is at the forefront of our daily review of news, climate change, given the nature of the research he conducts and – and the information he supplies and how valuable it is to all of us, certainly he made mistakes here, but it’s regrettable that it could not have been taken care of, I think, by some type of pretrial diversion so that he would not be an adjudicated felon.”

In my 33 year career―22 spent as a prosecutor, the past 11 as a defense attorney―I have never heard a judge similarly chastise the government for bringing a case that, in the court’s view, so clearly lacked merit.  Nevertheless, the court accepted the guilty plea and sentenced Dr. Wang to time served―the one day he spent in jail at the time of his arrest.  He was to pay no fine, no restitution and serve no probationary sentence.  Instead, he was to go back to China to work.

Despite the court’s admonishment the case against Dr. Wang should never have been brought in the first place; the government – after previously representing that it would not issue any press release regarding Dr. Wang’s disposition – nevertheless issued a false and misleading press release “touting” their conviction of Dr. Wang.  This press release violated DOJ policy by referencing unproven allegations that the Court dismissed as if they were established facts.

Had the government wanted to inform the public of the unproven allegations contained in the Indictment, it was required to state that the charges were merely accusations, and that Dr. Wang was, and remains, presumed innocent of those dismissed charges.

There can be only one reason to issue a false and misleading press release: not satisfied with making Dr. Wang unemployable in the U.S., the government now seeks to vindictively impact his job prospects in China.  It should disturb all Americans who believe in the rule of law that the Department of Justice violated its own policies to smear Dr. Wang in order to extract an extra-judicial penalty in a case that the Court believed should never have been brought.

Dr. Wang was unfairly targeted and victimized by his own government, a fact recognized by the judge in his case.  He is collateral damage in the United States government’s campaign against Chinese-American scientists.  Unfortunately, he will not be the last.

Peter Zeidenberg

cc: Members, Congressional Asian Pacific American Caucus

6) Unjustified indictments of Szuhsiung “Allen” Ho and Ching Ning Guey

Unjustified indictments of Szuhsiung “Allen” Ho and Ching Ning Guey
Used 1946 Atomic Energy Act designed to discourage the spread of nuclear weapons and applied it to an export licensing matter involving commercial reactor technology used around the world – activity that had nothing to do with bombmaking.

Loretta E. Lynch, U.S. Attorney General
John P. Carlin, Assistant Attorney General for National Security
Michael Steinbach, Executive Assistant Director of the FBI’s National Security Branch
Nancy S. Harr, U.S. Attorney, Eastern District of Tennessee
Charles E. Atchley, Jr., Assistant U.S. Attorney, Eastern District of Tennessee
Casey T. Arrowood, Trial Attorney, National Security Division, U.S. Department of Justice
William Leckrone, FBI Agent

1/6/17 Washington Post: “U.S. used Cold War-era statute to prosecute Taiwanese American nuclear engineer”
By Ellen Nakashima and Steven Mufson
A Taiwanese American nuclear engineer pleaded guilty Friday to one count of conspiring to produce “special nuclear material,” in this case plutonium, outside the United States without a license from the secretary of energy.

6/9/16 Knoxville News Sentinel: Defense seeks engineer’s freedom pending trial in Tenn. nuclear espionage case
By Jamie Satterfield

7) Mingqing Xiao acquitted, convicted of minor tax reporting infractions, sentenced to probation

In April 2021, the DOJ indicted Mingqing Xiao, a mathematics professor and researcher at Southern Illinois University (SIU) for two counts of wire fraud and one count of making a false statement as part of the “China Initiative.”

He was acquitted of all charges in the original indictment filed in April 2021.  However, he was found guilty on four tax charges – three counts that he did not check the box on 3 years of his taxes indicating that he had a foreign bank account, and one count that he did not file a Foreign Bank Account Report.

For that conviction, the DOJ recommended one year in prison and a $50,000 fine. The judge sentenced him to one year probation and a $600 fine.


Donate to his legal defense fund at https://www.gofundme.com/f/legal-defense-fund-for-mingqing-xiao

8) Franklin Tao.  3 charges of wire fraud dismissed.  Appealing conviction of one count of making false statements

Prosecutors charged Tao with concealing his work with a Chinese university and his affiliation with a Chinese government-backed talent program. The Department of Justice also charged that Tao attempted to defraud the University of Kansas and the U.S. government of grant money by failing to fill out conflict-of-interest forms while he was doing work for Fuzhou University in China.  The judge dismissed 3 of the 4 charges because there was no evidence that Tao obtained money or property through the alleged scheme to defraud, as required under the wire fraud statute.  She did however let stand a lesser charge of making false statements.

Donate to his legal defense fund: https://www.gofundme.com/f/Legal-Defense-Fund-for-Franklin-Tao

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