United States District Court, Northern District of Illinois, E.D
March 31, 1983
BENJAMIN LUNETTO, JR., PLANTIFF,
UNITED STATES OF AMERICA, DEFENDANT.
The opinion of the court was delivered by: Aspen, District Judge:
MEMORANDUM OPINION AND ORDER
Plaintiff Benjamin Lunetto, Jr. ("Lunetto") has sued the United
States pursuant to 28 U.S.C. § 1346(a)(2),*fn1 28 U.S.C. § 1331,*fn2
5 U.S.C. § 701,*fn3 the Fifth Amendment, and 28 U.S.C. § 1361,*fn4
seeking monetary damages and reinstatement to his employment as a
Facilities Maintenance Manager in the Navy Exchange Service.
Presently pending before the Court is the United States' motion
to dismiss Lunetto's First Amended Complaint,*fn5 or in the
alternative for summary judgment. For reasons set forth below,
the United States' motion for summary judgment as to Count II is
granted; the United States' motion to dismiss is granted as to
Counts I and III.
Lunetto had been employed as the Facilities Maintenance Manager
of the Navy Exchange at Great Lakes, Illinois. On September 2,
1980, he received, in the form of a letter, a thirty day advance
notice of proposed disciplinary action and suspension. The notice
charged Lunetto with a first offense of the unauthorized use of
government facilities, property and manpower, in violation of
Navy Regulations. On September 5, 1980, Lunetto was terminated
from his position effective October 2, 1980, in a letter from the
Naval Exchange Officer, Captain L.C. Gray. Captain Gray affirmed
his decision in a letter dated September 26, 1980. A hearing was
conducted on March 16, 1981, before hearing Officer John J.
O'Connor at the Naval Training Center, Great Lakes. Based upon
evidence presented, O'Connor recommended that Captain Gray's
decision be sustained. The Commanding Officer of the Naval
Administrative Command affirmed the decision to terminate Lunetto
in a letter of April 28, 1981. On March 24, 1982, the Commander
of the Navy Resale and Service Support Office upheld the
termination, finding Lunetto's termination to be neither
arbitrary, capricious nor an abuse of discretion. Lunetto thus
exhausted all administrative remedies available to him prior to
filing the instant lawsuit.
Motion To Dismiss:
In deciding the instant motion to dismiss, we must take the
allegations of Lunetto's complaint as true and view them, and any
reasonable inferences to be drawn from them, in the light most
favorable to him. Powe v. City of Chicago, 664 F.2d 639, 642 (7th
Cir. 1981). A complaint should be dismissed, moreover, only if it
"appears beyond doubt that the plaintiff can prove no set of
facts in support of his claim which would entitle him to relief."
Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-102, 2
L.Ed.2d 80 (1957).
Motion For Summary Judgment:
In support of a motion for summary judgment, the moving party
has the burden of showing that there is no dispute as to any
genuine issue of fact material to a judgment in his favor as a
matter of law. Cedillo v. International Association of Bridge &
Structural Iron Workers, Local Union No. 1, 603 F.2d 7, 10 (7th
Cir. 1979). The nonmoving party is entitled to all reasonable
inferences that can be made in its favor from the evidence in the
record. United States v. Diebold, 369 U.S. 654, 655, 82 S.Ct.
993, 994, 8 L.Ed.2d 176 (1962); Moutoux v. Gulling Auto Electric,
295 F.2d 573, 576 (7th Cir. 1961). In deciding motions for
summary judgment, courts look beyond the pleadings and examine
exhibits, affidavits and other materials; this contrasts with
treatment of motions to dismiss under Fed.R.Civ.P. 12(b)(6),
which are based almost entirely upon the pleadings. 10A C. Wright
& A. Miller, Federal Practice and Procedure § 272 (2d ed. 1983).
It is with these standards in mind that we consider the
government's alternative motion.
Count I of Lunetto's amended complaint, which is based upon
28 U.S.C. § 1346, alleges that he had an implied contract with the
Naval Exchange based upon: 1) a Navy Regulation providing that
employees are to be made whole financially upon appeal of adverse
actions; 2) the duties delegated to him as a supervisor, in
addition to those of his job classification; 3) Naval Exchange
regulations governing the conditions of his employment. The
government argues that Army and Air Force Exchange Service v.
Sheehan, 456 U.S. 728, 102 S.Ct. 2118, 72 L.Ed.2d 520 (1982),
precludes the existence of an implied-in-fact contract based upon
the aforementioned sources.
Lunetto was employed by the Navy Exchange Service. Although not
funded by Congressional appropriations, Johnson v. United States,
600 F.2d 1218, 1221 (6th Cir. 1979), military exchanges are
governmental entities essential for the performance of government
functions, and they are thus entitled to any immunities from suit
enjoyed by the United States. Standard Oil Co. of California v.
Johnson, 316 U.S. 481, 485, 62 S.Ct. 1168, 1170, 86 L.Ed. 1611
(1942); see also Champaign-Urbana News Agency v. J.L. Cummins,
632 F.2d 680, 692 (7th Cir. 1980) (Army and Air Force Exchange
Service is entitled to immunity from Robinson-Patman Amendments
to the Clayton Act). It is well established that the United
States cannot be sued without its consent. United States v.
Testan, 424 U.S. 392, 399, 96 S.Ct. 948, 953, 47 L.Ed.2d 114
(1976); Clark v. United States, 691 F.2d 837, 839 (7th Cir.
1982). Unless Congress has expressly consented to a suit against
the United States, courts lack jurisdiction to entertain such
lawsuits. United States v. Sherwood, 312 U.S. 584, 587-88, 61
S.Ct. 767, 770, 85 L.Ed. 1058 (1941). We must thus consider
whether we have jurisdiction over Lunetto's claim for monetary
In Count I, Lunetto argues that the Tucker Act,
28 U.S.C. § 1346(a)(2), see note 1, supra, acts as a waiver of the United
States' sovereign immunity. The Tucker Act is indeed an explicit
waiver of sovereign immunity, Army and Air Force Exchange Service
v. Sheehan, 456 U.S. 728, 102 S.Ct. 2118, 2122, 72 L.Ed.2d 520
(1982), but it is solely a jurisdictional statute and does not
create any substantive right enforceable against the United
States for monetary damages. United States v. Testan, 424 U.S. at
399, 96 S.Ct. at 953. Lunetto therefore argues that Navy
Regulations, supervisory duties and Naval Exchange Regulations
created an implied contract between him and the United States
him with a right to monetary damages and enabling him to invoke
the Tucker Act as a jurisdictional basis for Count I. In Army and
Air Force Exchange Service v. Sheehan, 456 U.S. 728, 102 S.Ct.
2118, 72 L.Ed.2d 520 (1982), the Supreme Court held that the
Tucker Act does not convey jurisdiction over claims for monetary
relief asserted pursuant to Army and Air Force Exchange Service
(AAFES) personnel regulations. Moreover, an Exchange employee who
holds his or her position by appointment, rather than by an
employment contract, cannot argue that an express contract exists
between him or her and the government for purposes of Tucker Act
jurisdiction. Id. at 735-38, 102 S.Ct. 2122-24. Lunetto does not
argue that he has an express contract with the United States, nor
could he; the government has demonstrated that Lunetto was
appointed to his position.*fn6 An appointed employee subject to
unwarranted personnel action does not have a cause of action
against the government absent a specific regulation or statute.
United States v. Hopkins, 427 U.S. 123, 128, 96 S.Ct. 2508, 2511,
49 L.Ed.2d 361 (1976). Rather, Lunetto claims he had an implied
contract with the government. But jurisdiction over Lunetto's
complaint cannot be premised upon the alleged violation of
regulations that do not expressly authorize monetary damages.
Army and Air Force Exchange Service v. Sheehan, 456 U.S. 728,
739, 102 S.Ct. 2118, 2125, 72 L.Ed.2d 520 (1982); United States
v. Testan, 424 U.S. 392, 96 S.Ct. 948, 47 L.Ed.2d 114 (1976).
While Secnavinst 5300.22(5)(d)(8) provides that an employee has
"the potential to be `made whole' financially for pay and
restoration to duty" in the event that an employee successfully
appeals an adverse personnel action, this regulation does not
specifically authorize a remedy under the Tucker Act.
Furthermore, Lunetto has not presented this Court with examples
of any Navy Exchange Regulations which might authorize suit under
the Tucker Act.
Allowing a lawsuit under the Tucker Act based upon the above
regulations would also violate the intent of Congress. While the
Back Pay Act permits employees to recover lost wages due to
unwarranted personnel actions, 5 U.S.C. § 5596(b)(1), Congress
has clearly denied such a cause of action to Navy exchange
employees in 5 U.S.C. § 2105(c).*fn7 Allowing Lunetto to sue for
monetary damages under the Tucker Act because he asserted
violations of Navy regulations governing terminations would thus
interfere with Congress' legislative structure. Army and Air
Force Exchange Service v. Sheehan, 456 U.S. 728, 740, 102 S.Ct.
2118, 2125, 72 L.Ed.2d 520 (1982). Nor are we persuaded that
Lunetto had an "implied in fact contract based upon the
duties . . . delegated to him as a supervisor . . . in addition
to those of his job classification. . . ." The job description
Lunetto signed clearly provided for supervisory responsibilities,
and Lunetto has not explained how such additional duties would
create an implied contract. We therefore
hold that the Tucker Act does not confer jurisdiction over
Lunetto's claims for monetary relief.
In Count II of his amended complaint, Lunetto asserts that his
discharge denied him substantive and procedural due process, and
he seeks reinstatement to his former position. He denies that the
evidence elicited at the hearing of March 16, 1981, supported the
decision of the Hearing Officer to terminate him, and declares
that termination will not "promote the efficiency of the
service." Lunetto further asserts that the United States failed
to adequately investigate the incident upon which his termination
was based. In response, the government argues that this Court
should not reverse the decisions of the Exchange to terminate
Lunetto unless they are lacking any rational basis and arbitrary
The Court of Appeals for the Seventh Circuit has clearly
articulated the standard of review to be applied in cases
involving the discharge of government employees, which requires
that we ascertain that proper procedures were followed in
Lunetto's discharge and that it was not arbitrary and capricious.
Ringquist v. Hampton, 582 F.2d 1138, 1139 (7th Cir. 1978), cert.
denied, 440 U.S. 910, 99 S.Ct. 1220, 59 L.Ed.2d 458; Pauley v.
United States, 419 F.2d 1061, 1065 (7th Cir. 1969). An agency
discharge decision is neither arbitrary nor capricious where the
record shows a rational basis for the action, Young v. Hampton,
568 F.2d 1253, 1257 (7th Cir. 1977); reinstatement may thus be
ordered only if an employee's discharge is not supportable on any
rational basis. Ringquist, 582 F.2d at 1140. And the burden of
proof in a disciplinary proceeding has clearly been placed upon
the agency, Young, supra.
Some of Lunetto's objections relate to the administrative
procedures afforded to him. He claims that the Naval Exchange
Officer failed to conduct an investigation into the offense, that
the agency failed to apply prescribed standards for disciplinary
action and that a penalty less severe than termination was not
considered. The administrative record indicates that these
objections are without merit. While the Hearing Officer conceded
that the quality of the investigation was less thorough than it
might have been, an investigation was indeed conducted. Captain
Gray's testimony at the hearing revealed that he considered and
rejected penalties other than termination. Moreover, the Exchange
complied with the standards governing adverse personnel actions
provided for in Secnavinst 5300.22(v).
Turning to Lunetto's claims concerning the substance of the
Exchange's decision, we note that the government presented
evidence of a letter from Lunetto to Captain Gray which admitted
that the charges against him were "basically true" and offered to
make "financial reparation" for use of government employees. One
of the employees involved testified at the hearing that he was
returning from lunch when Lunetto approached him and enlisted his
assistance; the witness also testified that he returned to work
after helping Lunetto. Lunetto, moreover, conceded that he used
government property for his own purposes. Review of the
administrative record thus persuades us that there was a rational
basis for Lunetto's termination. There is, furthermore,
sufficient evidence in the record to conclude that the Exchange
considered whether Lunetto's termination "will promote the
efficiency of the service," which is an inquiry relevant to
federal employee disciplinary proceedings. Young v. Hampton,
568 F.2d 1253, 1257 (7th Cir. 1977).*fn9 And the fact that Lunetto
occupied a supervisory position at the time of his misconduct, as
well as the nature of the misconduct, underscores our conclusion
that termination was not so disproportionate a penalty as to
render the Exchange's action arbitrary and capricious. Young, 568
F.2d at 1264. We therefore conclude that the Navy Exchange did
not abuse its discretion in terminating Lunetto and grant the
government's motion for summary judgment as to Count II.
In Count III Lunetto claims that he has a clear right to
reinstatement to his former position and invokes 28 U.S.C. § 1361,
see note 4, supra, as a jurisdictional basis for this
claim. Mandamus may issue only when a plaintiff presents a clear
claim for relief and where the duty of the federal officer is
both explicitly defined and purely ministerial. McClendon v.
Blount, 452 F.2d 381, 383 (7th Cir. 1971); mandamus is a
"powerful and unusual" remedy, which must be defined by a statute
that is clear and free from doubt. Jarecki v. United States,
590 F.2d 670, 674 (7th Cir. 1979), cert. denied, 444 U.S. 829, 100
S.Ct. 55, 62 L.Ed.2d 37 (1979).
The absence of a statute or regulation establishing a clear
duty on the part of the United States to reinstate Lunetto
establishes that mandamus is inappropriate here. The government
provided Lunetto with all of the procedural protections to which
he was entitled, and his termination was not an abuse of
discretion. He is thus not entitled to be "made whole" through
reinstatement pursuant to Navy Regulations, and Count III is
For the foregoing reasons, the government's motion to dismiss
Counts I and III is granted; its motion for summary judgment as
to Count II is also granted. It is so ordered.