Zaccardelli v. United States

68 Fed. Cl. 426, 178 L.R.R.M. (BNA) 2449, 2005 U.S. Claims LEXIS 327, 2005 WL 2901789
CourtUnited States Court of Federal Claims
DecidedOctober 27, 2005
DocketNo. 00-521C
StatusPublished
Cited by3 cases

This text of 68 Fed. Cl. 426 (Zaccardelli v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Zaccardelli v. United States, 68 Fed. Cl. 426, 178 L.R.R.M. (BNA) 2449, 2005 U.S. Claims LEXIS 327, 2005 WL 2901789 (uscfc 2005).

Opinion

OPINION

FIRESTONE, Judge.

This matter comes before the court on the parties’ cross-motions for summary judgment and the defendant’s motion to dismiss. The plaintiffs, Marco Zaecardelli, Bruno Branchizio, and John Corvino (“plaintiffs”), are dual Italian-United States nationals who, until recently, were employed in Naples, Italy. The plaintiffs contend that they were hired and employed by the United States, through the Department of the Navy (the “government” or “Navy”) until the United States fired them in violation of employment agreements negotiated on their behalf by their respective union representatives. The plaintiffs allege that, as part of these employment agreements, the government agreed that their employment would not be terminated based on their status as United States citizens “ordinarily resident” in Italy. They contend that the government fired them because of their “ordinarily resident” status, thus violating their contractual rights.

The government responds by contending that this court lacks jurisdiction over the plaintiffs’ claims because the plaintiffs are Civil Service employees, whose rights are governed exclusively by statute and not by contract. The government further argues [428]*428that plaintiff Branchizio was not employed by the United States and, as such, would have no recourse against the United States in any event. In the alternative, the government asserts several affirmative defenses to the plaintiffs’ claims, including the defense that the termination of the plaintiffs’ employment was a sovereign act for which the United States is immune, and the defense that the government is not liable for any breach of contract because its performance was impracticable.

BACKGROUND

The facts relevant to this case are not in dispute. All of the plaintiffs are dual nationals of both Italy and the United States. Plaintiffs Zaceardelli and Corvino were employed by the Navy Post Exchange, located on the United States Naval Base in Naples, Italy (“Base”). Plaintiff Branchizio worked at the Navy’s Morale, Welfare and Recreation office, Naples (“MWR”). All of these plaintiffs were members of the American Federation of Government Employees, Local 3712 (the “Union”). The Union entered into a collective bargaining agreement with the Navy (“Navy Exchange CBA”) regarding the employment of plaintiffs Zaceardelli and Cor-vino. The Union entered into a collective bargaining agreement with MWR (“MWR CBA”) regarding the employment of plaintiff Branchizio.

The CBAs provided, in relevant part, that “the Employer will not dismiss U.S. citizens already employed on October 27, 1993 as a result of application of the ‘Ordinarily Resident’ criteria.” Navy Exchange CBA Art. 6, § 13; MWR CBA Art. 6, § 10. “Ordinarily resident,” in turn, is defined by a provision of the Status of Forces Agreement (“SOFA”) entered into by the signatories of the members of the North Atlantic Treaty Organization (“NATO”), including Italy and the United States. The NATO SOFA provides that a person who is a national of both the United States and Italy, but who “ordinarily resides” in Italy, cannot be a civilian employee of the United States military forces in Italy. See NATO SOFA, Art. I, § 1(b). The parties do not dispute that the plaintiffs are “ordinarily resident” in Italy as described by the SOFA and incorporated into the CBA, nor do they dispute that the plaintiffs were employed in their respective positions on October 27, 1993.

Because of their status as employees pursuant to the NATO SOFA, the plaintiffs enjoyed significant benefits in the form of exemptions from certain taxes while employed by the Navy Exchange and the MRW, respectively. These tax exemptions applied to “motor vehicles, petroleum products, and goods and services sold in military exchanges and commissaries. Such benefits are not available to citizens of the host country.” Letter from Rowe to Sanseverino, May 6, 1998, Def.’s App. 29. The plaintiffs were receiving these tax benefits, pursuant to the NATO SOFA, despite the fact that they, as United States citizens “ordinarily resident” in Italy, were evidently ineligible to be employed pursuant to the NATO SOFA according to its terms.

In 1996, the plaintiffs’ favored position became precarious when the Italian government began to arrest civilian employees of the United States military in Italy who, like the plaintiffs, were dual citizens of the United States and Italy. The Italian government prosecuted these employees, contending that they were “ordinarily resident” within the contemplation of the SOFA, and so were ineligible to be civilians employed by the United States military in Italy, and, as such, were unlawfully evading taxes when they took advantage of the SOFA’s tax exemptions. Letter from Rowe to Sanseverino, Def.’s App. 29.

In March 1998, the Navy mandated that all Navy civilian employees who were dual nationals of the United States and Italy renounce their citizenship so that they would no longer be Italian citizens “ordinarily resident” in Italy but working for the Navy. Navy civilian employees who renounced their citizenship would no longer be in violation of the NATO SOFA, and presumably no longer would be subject to prosecution by the Italian government for tax evasion. Dual nationals who refused to renounce their Italian citizenship were terminated from employment by the Navy. Plaintiffs Zaceardelli and Corvino chose not to renounce their Italian [429]*429citizenship and were terminated in December 1998. Plaintiff Branchizio refused to renounce his Italian citizenship and retired in January 1999.

The plaintiffs’ Union filed several grievances on behalf of the plaintiffs in response to the Navy’s position. After the Navy denied these grievances, the Union subsequently filed an unfair labor practice complaint with the Federal Labor Relations Authority. The Union withdrew the complaint voluntarily and then filed a final grievance, which was denied by the Navy on December 18, 1998.

On August 28, 2000, the plaintiffs filed a complaint in this court. The government moved the court to dismiss under Rule 12(b)(1) of the Rules of the Court of Federal Claims (“RCFC”) on December 5, 2000. While this motion was pending, the court suspended proceedings in light of a pair of cases that the Court of Appeals for the Federal Circuit was considering. These cases, Mudge v. United States, 308 F.3d 1220 (Fed.Cir.2002) and O’Connor v. United States, 308 F.3d 1233 (Fed.Cir.2002), related to the jurisdiction of this court to adjudicate actions brought by federal civil service employees. In light of these cases, the government filed a Revised Motion to Dismiss under RCFC 12(b)(1) and 12(b)(6) on June 26, 2003, which the plaintiffs opposed. The court suspended proceedings again in light of another case pending in the Federal Circuit in which the Court of Appeals addressed the remedies for grievances available under collective bargaining agreements.1 This case, Todd v. United States, 386 F.3d 1091 (Fed.Cir.2004), was issued on October 5, 2004, after which this court ordered the plaintiffs to submit cross-motions for summary judgment on all issues remaining in the case. The plaintiffs filed their motion for summary judgment on all issues remaining in the case on February 7, 2005, and the government cross-moved for summary judgment on March 14, 2005.

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68 Fed. Cl. 426, 178 L.R.R.M. (BNA) 2449, 2005 U.S. Claims LEXIS 327, 2005 WL 2901789, Counsel Stack Legal Research, https://law.counselstack.com/opinion/zaccardelli-v-united-states-uscfc-2005.