Cunningham v. United States
2014 U.S. App. LEXIS 6493
Fed. Cir.2014Background
- Cunningham, an OPM criminal investigator, settled an MSPB appeal of his 2005 termination: OPM paid $50,000, agreed to limit reference disclosures (only dates/years of service), remove the termination letter, and both parties agreed to keep the settlement confidential; the MSPB put the settlement on the record for enforcement.
- In 2007–08 Cunningham was suspended and then terminated by a private contractor (USIS) after OPM employees discussed his termination with a background investigator; Cunningham alleges this violated the settlement’s confidentiality/reference limits.
- Cunningham filed an MSPB petition to enforce the settlement; an AJ and the MSPB found OPM materially breached but explained the MSPB lacked authority to award monetary damages and could only offer rescission and reinstatement of the appeal. Cunningham declined rescission and the MSPB dismissed his petition.
- Cunningham sued the United States in the Court of Federal Claims under the Tucker Act seeking monetary damages for breach of contract. The Claims Court found Tucker Act jurisdiction but dismissed the suit as barred by res judicata.
- The Federal Circuit (panel opinion) holds the Claims Court has Tucker Act jurisdiction to hear Cunningham’s contract-damages claim and reverses the Claims Court because res judicata does not bar the suit given the MSPB’s lack of authority to award monetary relief.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Tucker Act jurisdiction extends to a suit for money damages for breach of a federal-agency settlement incorporated into an MSPB order | Cunningham: settlement is a contract that contemplates money damages for breach; Claims Court (Tucker Act) has jurisdiction | Government: MSPB consent-decree/incorporation and CSRA’s remedial scheme preclude Claims Court jurisdiction; settlement subject to MSPB exclusive enforcement | Held: Claims Court has Tucker Act jurisdiction because the settlement can fairly be read to contemplate money damages (Holmes/VanDesande controlling) |
| Whether incorporation of the settlement into an MSPB order (consent decree) strips the agreement of its contract character and divests Tucker Act jurisdiction | Cunningham: incorporation does not eliminate contract character; he seeks contractual damages, not enforcement of the MSPB order | Government: incorporation makes it a consent decree subject to MSPB/CSRA exclusivity | Held: Incorporation does not remove the contract character; VanDesande supports Tucker Act jurisdiction to enforce monetary bargain |
| Whether res judicata bars Cunningham’s Claims Court suit after MSPB issued a final order finding breach but offering only non-monetary remedies | Cunningham: res judicata shouldn't bar him because MSPB lacked authority to award money damages; he was precluded from obtaining that remedy in the first forum | Government: MSPB’s final judgment on the merits precludes relitigation in Claims Court | Held: Res judicata does not bar the Claims Court action under Restatement (Second) of Judgments §26(1)(c) because the MSPB’s limited remedial jurisdiction prevented Cunningham from obtaining monetary relief in the first forum |
Key Cases Cited
- Holmes v. United States, 657 F.3d 1303 (Fed. Cir. 2011) (Claims Court has Tucker Act jurisdiction over breach-of-settlement-agreement claims that fairly contemplate money damages)
- VanDesande v. United States, 673 F.3d 1342 (Fed. Cir. 2012) (a settlement embodied in a decree remains a contract for Tucker Act purposes; incorporation does not eliminate Claims Court jurisdiction to award damages)
- Foreman v. Department of Army, 241 F.3d 1349 (Fed. Cir. 2001) (MSPB lacks authority to award monetary damages for breach of settlement)
- Phillips/May Corp. v. United States, 524 F.3d 1264 (Fed. Cir. 2008) (claim preclusion applies when the first forum could have provided complete relief)
- United States v. Navajo Nation, 556 U.S. 287 (U.S. 2009) (sovereign immunity and limits on waiver)
- United States v. ITT Continental Baking Co., 420 U.S. 223 (U.S. 1975) (consent decrees have dual character as contracts and judicial orders)
- United States v. Utah Construction & Min. Co., 384 U.S. 394 (U.S. 1966) (administrative agency decisions preclusive only when acting in a judicial capacity)
- Fausto v. United States, 484 U.S. 439 (U.S. 1988) (CSRA comprehensive scheme limits review of personnel actions)
- Gurley v. Hunt, 287 F.3d 728 (8th Cir. 2002) (administrative forum’s inability to award full relief may allow subsequent suit in another tribunal)