Chen wanted to remain in China, to work for reforms. So U.S. officials negotiated a deal to permit the self-taught lawyer to finally attend law school and ensure his and his family's safety. The U.S. ambassador accompanied him to a hospital, where he was reunited with his family; Clinton publicly called on China to keep its commitments.
But once in the hospital, Chen panicked, saying he had learned that Linyi government thugs had threatened to beat his wife to death. He said he'd been misled and now feared for his life, and wanted to leave China; he appealed to President Obama.
Clinton, in Beijing to talk about trade, Syria, and Iran, faces a human-rights crisis, as does Obama. So do China's leaders, who will confront an international outcry if they harm or detain Chen.
Yet - if U.S. and Chinese officials can handle the Chen affair wisely - this story could still, just possibly, end well.
To understand why, a little history is needed. Chen, who comes from a poor background, was never a dissident, but rather a crusader for Chinese officials to obey their own laws.
By the time he emerged in the mid-1990s as a leader of the battle against forced abortion and sterilization, national Chinese laws had already ruled out such practices. But many local officials refused to jettison their use.
In the last decade, corrupt and illegal behavior by local party bosses has become a scourge that undermines China's development. It has led to a growing number of protests across the country against unlawful land seizures and staggering corruption at local and regional government levels.
Public-interest lawyers - a small but courageous breed - have tried to help peasants protest such practices. In trips to Beijing, I've met with law professors and students working on projects to help farmers being defrauded of their land.
But divisions within China's top leadership have hampered any campaign to rein in local officials. Those who promote rule of law are labeled dissidents; too often, it is the public-interest lawyers who are jailed.
However, the rule-of-law issue has emerged front and center as China heads toward a once-in-a-decade shift in leadership this fall.
The spectacle of unlawful behavior by local party bosses exploded publicly with the messy downfall of Bo Xilai, a powerful party chief in the city of Chongqing and a rising political star. He is now being investigated for massive corruption and possible family involvement in the murder of a British businessman.
Some political reformers hoped the fall of Bo would embolden would-be political reformers in the present and future party leadership to come into the open. No signs yet.
However, there's been one recent, hopeful signal. The most powerful Communist official in Guangdong province, Wang Yang, backed the villagers of Wukan, who were protesting against illegal landgrabs. He made clear this signaled a demand for better local governance.
Now comes the case of Chen Guangcheng - which could offer political reformers a golden chance.
"The ultimate question leaders of China have to confront is lawlessness," says New York University professor Jerome Cohen, the top U.S. expert on the Chinese legal system. "The party has encouraged rule of law, and increased the rights consciousness of the masses" but in practice has punished those who tried to obey the law.
Cohen knows Chen well; he spoke to him at length by phone while he was in the embassy. "Chen wanted to use the system," Cohen says. "He wasn't calling to change party rule, but for them to put their money where their mouth is" on the rule of law. The smart move for Chinese party leaders would be to make the blind lawyer into a symbol of the need to curb lawless local officials - like Bo Xilai.
"With new leadership coming in China, this could be an opportunity," Cohen continued, "for a cluster of [top Chinese] leaders . . . to say, 'The people of China are ready for a better legal system, and we've failed to respond as we did with opening up the economy.' " Cohen hopes Chen's case could galvanize Chinese leaders to take such action.
But the blind lawyer won't be safe unless Obama and Clinton insist that China guarantee his and his family's security and freedom, or let them leave the country.
After all, Chen Guangcheng is a true Chinese patriot, promoting the rule of law his country needs to prevent aggrieved peasants from taking to the streets.
E-mail Trudy Rubin