Diane Schroer of Alexandria, Va., applied for the terrorism analyst job while she was still a man named David Schroer. He was offered the job, but the offer was pulled after he told a library official that he was having surgery to change his gender.
U.S. District Judge James Robinson ruled Tuesday that Schroer was entitled to $491,190 in back pay and damages because of sex discrimination.
The Library of Congress and the Justice Department argued unsuccessfully that discrimination because of transsexuality was not illegal sex discrimination under the Civil Rights Act.
The American Civil Liberties Union had argued the case on Schroer's behalf. Paul Cates with the ACLU's Lesbian and Gay Rights Project said the ruling was significant because a federal judge said that discriminating against someone for changing genders is sex discrimination under federal law.
Schroer is a former U.S. Army colonel who directed a classified group that tracked and targeted terrorists. Schroer retired in 2004 and worked briefly in the private sector before applying for the Congressional Research Service job at the Library of Congress.
After being offered the job, Schroer had lunch with a Library of Congress official and explained the upcoming surgery. Schroer testified the official called the next day and said the position would not be a "good fit."