Free Response to Motion [Dispositive] - District Court of Federal Claims - federal

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C.A. No. 99-2051C (Senior Judge Smith) IN THE UNITED STATES COURT OF FEDERAL CLAIMS ATHEY, ROBERT M., et al., Plaintiffs, v. THE UNITED STATES, Defendant. PLAINTIFFS'OPPOSITION TO DEFENDANT'S MOTION TO DISMISS

IRA M. LECHNER Attorney for Plaintiffs 19811-4th Place Escondido, CA 92029 Phone: 858-864-2258 Fax; 760-839-5755

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TABLE OF CONTENTS
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I.
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PLAINTIFFS' CLAIMS WERE FILED IN 1999, WELL WITHIN THE APPLICABLE STATUTE OF LIMITATIONS PERIOD
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Page 7

II.
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THERE IS NO BASIS WHATSOEVER FOR DEFENDANT'S Page 12 ARGUMENT THAT PLAINTIFFS ENGAGED IN UNREASONABLE DELAY IN FILING THEIR COMPLAINT; THEREFORE, DEFENDANT'S THEORY BASED ON LACHES MUST FAIL
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III.
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DEFENDANT MISCHARACTERIZES THE INTERPLAY BETWEEN Page 15 THE LUMP-SUM PAYMENT STATUTES AND NURSES' ADDITIONAL PAY PURSUANT TO TITLE 38
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A.
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INTRODUCTION
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Page 15 Page 17

B.

OPM, AND THE VA, HAVE INTERPRETED THE WORD "PAY" IN THE LUMP-SUM "PAY" STATUTE TO INCLUDE PREMIUM PAY

C.

THE STATUORY SCHEME INCLUDES ALL FORMS OF Page 20 "PAY"IN THE COMPUTATION OF "LEAVE WITH PAY"AS WELL AS THE LUMP-SUM PAYMENT FOR UNUSED ANNUAL LEAVE LEGISLATIVE HISTORY OF THE LUMP-SUM LEAVE PAYMENT DEFENDANT'S RELIANCE ON § 7453 (i) IS MISPLACED THE INTERPLAY BETWEEN THE LUMP-SUM LEAVE PAYMENT STATUTE AND THE LIMITATION UPON CONSIDERING ADDITIONAL PAY AS BASIC PAY IN SECTION 7453 (i) LEGISLATIVE HISTORY OF 38 U.S.C. § 7453 (i) 1. The Veterans Health Care Expansion Act of 1973 2. Congressional Intent Page 24 Page 26 Page 31

D. E. F.

G.

Page 33 Page 33 Page 34 Page 37

H.

SUMMATION OF PLAINTIFFS' ARGUMENT

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TABLE OF AUTHORITIES
CASES AAB Joint Venture v. United States, 75 Fed. Cl. 432, 440 (2007) Aamold v. United States, 39 Fed. Cl. 735 (1997) Abbot v. United States, 204 F. 3d 1099, 1102 (Fed. Cir. 2000) Abbott v. United States, 41 Fed. Cl. 553 (1998) Abrams v. United States, 57 Fed. Cl. 439 (2003) Abramson v. United States, 42 Fed. Cl. 621 (1998) Abreu v. United States, 948 F. 2d 1229 (Fed Cir. 1991) Acton v. United States, 932 F. 2d 1464 (Fed. Cir. 1991) Adams v. United States, 27 Fed. Cl. 13 (1992) Advanced Cardiovascular Systems, Inc. v. Scimed Life Systems Inc., 988 F. 2d 1157, 1161 (Fed. Cir. 1993) AFGE, Local 3295 v. FLRA, 46 F. 3d 73, 78 (D.C. Cir. 1995) Archuleta et al v. United States, Armitage v. United States, 991 F. 2d 746 (Fed. Cir. 1993) Artuz v. Bennett, 531 U.S. 4, 10 (2000) Robert M. Athey et al v. United States, Page 15 Page 24 Page 23 Page 24 Page 23 Page 24 Page 23, 30 Page 23 Page 24 Page 15 Page 31 Passim Passim Page 40 Passim

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Bailey v. United States, 52 Fed. Cl. 105, at 110 (2002) Barnes v. United States, 72 Fed. Cl. 6 (2006) Barnes v. United States, 68 Fed. Cl. 492 (2005) Bedrock Ltd. v. United States, 541 U.S. 176, 183 (2004) Berg v. United States, 49 Fed. Cl. 459 (2001) Bull v. Unites States, 65 Fed. Cl. 407 (2005) Butterbaugh et al v. Dep't of Justice, 336 F. 3d 1332, 1338 (Fed. Cir. 2003)

Page 38 Page 23 Page 23 Page 32 Page 24 Page 23 Page 19, 23

Cannon v. University of Chicago, Page 32 441 U.S. 677, 696-97, 99 S. Ct. 1946, 1957-58, 60 L.Ed.2d 560 (1979) Carter v. Gibbs, 909 F. 2d 1452, 1455 (Fed. Cir. 1990) Cf. Catawba Indian Tribe of So. Carolina v. United States, 982 F. 2d 1564, 1570 (Fed. Cir. 1993) Contreras v. United States, 64 Fed. Cl. 583, 592 (2005) Cornetta v. United States, 851 F. 2d 1372, 1375 (Fed. Cir 1988) (en banc.) Curry v. United States, 66 Fed. Cl. 593 (2005) Elmore v. Henderson, 227 F. 3d 1009, 1012 (7th Cir. 2000)
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Page 40 Page 14 Page 23 Page 15 Page 23 Page 8 Page 13 Passim Page 23 Page 31

Brian Entendencia v. United States, No. 06-515C, 2007 WL851211 (Fed. Cl. March 19, 2007) Gaffney et al v. United States, 824 F. Supp. 1 (D.D.C. 1991) Grandits v. Unites States, 66 Fed. Cl. 519 (2005) Holloway v. United States, 526 U.S. 1, 6 (1999)

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James v. Von Zemenszky, 284 F. 3d 1310 (Fed. Cir. 2002) Lamie v. United States Tr., 540 U.S. 526, 534 (2004) Lanehart v. Horner, 818 F. 2d 1574 (Fed. Cir. 1987)

Page 23 Page 31 Passim

Miles v. Apex Marine Corp., Page 32 498 U.S. 19, 32, 111 S. Ct. 317, 325-26, 112 L. Ed.2d 275 (1990) Mudge v. United States, 308 F. 3d 1220, 1227-28 (Fed. Cir. 2002) United States v. Menache, 348 U.S. 528, 538-39 (1955) White v. ABCO Eng'g Corp, 199 F. 3d 140, 145 n.6 (3rd Cir. 1999)
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Page 27, 38 Page 28 Page 8 Page 28

Williams v. Taylor, 529 U.S. 362, 404 (2000) STATUTES

5 U.S.C. § 4109 (a) (1) 5 U.S.C. § 5343 (f) 5 U.S.C. § 5545(c)(1) and (2) and 5545a 5 U.S.C. §§ 5551-5552 5 U.S.C. § 5924(1) 5 U.S.C. § 5471 5 U.S.C. § 2105 5 U.S.C. 6303 5 U.S.C. § 7121 (a)(1) 38 U.S.C. Chap. 74, sub-chapter III 38 U.S.C. §§ 7453-7454 38 U.S.C. § 7425 (a) 38 U.S.C. § 7425 (b) 5

Page 28 Page 19 Page 25 Passim Page 10 Page 10 Page 16 Page 18 Page 27 Page 10 Passim Page 17 Page 29

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28 U.S.C. § 2501 Veterans Health Care Expansion Act of 1973, Pub. L. No. 93-82, 87 Stat. 179 (1973). REGULATIONS 5 CFR § 531.202; 5 CFR § 550103 64 FR 36763, 36770 (July 8, 1999) VA Handbook 5007, Part IV, Chapter 3, Appendix B-7 (a) thru 11

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Page 28 Page 18 Page 19

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

ROBERT M.ATHEY,et al. for themselves and on behalf of all others similarly situated, Plaintiffs, v. THE UNITED STATES OF AMERICA Defendant. No. 99-2051C (Senior Judge Smith)

PLAINTIFFS' OPPOSITION TO DEFENDANT'S MOTION TO DISMISS Defendant's credibility as a responsible litigant in this court has been brought into question by the irresponsible allegations contained in its Motion To Dismiss. As plaintiffs will demonstrate below, defendant's motion is entirely baseless. I. PLAINTIFFS' CLAIMS WERE FILED IN 1999, WELL WITHIN THE APPLICABLE STATUTE OF LIMITATIONS PERIOD

Defendant argues that plaintiffs' cause of action accrued in 1993, and the filing of the Athey complaint on June 21, 2006 is barred by the six-year limitations period. The core of defendant's argument is as follows ( Def.'s Brief, pp. 11-12): Plaintiffs here allege that the Government failed to include [sic.] in their lumpsum payment for accumulated and accrued leave upon their separation from service beginning on April 7, 1999. Comp. ¶ 1. Therefore, plaintiffs' cause of action accrued nearly 14 years ago and the filing of the Athey complaint on June 21, 2006 is untimely. Thus, the Court should dismiss the plaintiffs' complaint in its entirety with prejudice.

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Astonishingly, defendant completely ignores this Court's "Order Approving Settlement" and "Severance Order", entered on June 1, 2006 in Archuleta et al. v. United States, which was originated by Plaintiffs' Unopposed Motion for Severance pursuant to RCFC 21. At the same time that the Settlement Agreement was approved, the Court ordered the "severance without prejudice" of plaintiffs' claims that had not been resolved with respect to the VA. The Court specifically noted "defendant's agreement in footnote 1 of the Settlement Agreement to such a request". Based upon that agreement, the Court ruled that "the severance of those claims to be proceeded with separately is appropriate under RCFC 21 and is in the interests of judicial economy". The Court permitted the eight former VA plaintiffs to file the Athey case as a separate action. The Court ordered the Clerk to "treat the claims of these plaintiffs as a single action and shall assign a separate docket number to that case with the number `99-205-1C'". Thus, the Court's Severance Order without prejudice continued the litigation involving the VA that had been initiated when the Archuleta complaint was first filed on April 7, 1993. It is hornbook law that when a case is severed, the original filing date carries over to the new case. Elmore v. Henderson, 227 F.3d 1009, 1012 (7th Cir. 2000)( Judge Posner
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noted that a "separate, severed suit, though separate from the original suit for other purposes, would not have affected the tolling of the statute of limitations by the original suit. That is, it would have been a continuation of the original suit so far as he was concerned."); White v. ABCO Eng'g Corp., 199 F.3d 140, 145 n.6 (3rd Cir. 1999).
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Defendant's sudden memory loss of this Court's Orders in Archuleta is all the more shocking in that the attorneys who agreed to the Severance Order and who signed the Settlement Agreement in Archuleta as the "Authorized Representative of the Attorney

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General" are the same attorneys who filed Defendant's Motion to Dismiss that is now being considered by this Court in Athey. Moreover, during the Fairness Hearing in Archuleta in which defendant's counsel actively participated, the Court took specific note of the necessity of issuing a Severance Order with respect to the pending claims by those plaintiffs who were former employees by the VA. A brief recital of the history of the Archuleta litigation should be sufficient to provide a sound basis for rejection of defendant's motion to dismiss on statute of limitations grounds. Michael R. Clayton and Thelma R. Curry are former employees of the Department of Veterans Affairs ("VA"). They were named specifically as plaintiffs in the Archuleta class action complaint filed on April 7, 1999 which established the six-year limitations period beginning April 7, 1993 (CIVIL DOCKET FOR CASE #: 1:99-cv-00205-LAS and CLASS ACTION COMPLAINT FOR MONEY DAMAGES, both on file in the Clerk's Office). On October 4, 1999, plaintiffs filed an Amended Class Action Complaint for Money Damages, and on October 23, 2002, the Court granted plaintiffs leave to add six (6) former VA employees (Robert M. Athey, Richard S. Droske, Ralph L. Fullwood, Paul D. Ising, Charles A. Milbrandt, and Troy E. Page) as additional named plaintiffs. The Archuleta complaint was brought as a class action on behalf of former employees of all agencies of the United States, which obviously included the VA. Paragraph 3 of the initial and amended complaints, entitled "Class Description", specified that the plaintiff class on whose behalf the action was brought consisted of: "All civilian employees who retired, died , or separated after April 6, 1993 ...from employment by the United States or an agency, establishment or instrumentality thereof...". The amended complaint referred to the agencies' failure to include in the computation

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of the employees' lump-sum payment for unused annual leave all of the "pay" that retired or separated members of the putative class would have earned had they remained in the service of the United States for the duration of the period of unused annual leave in their account on the date of their retirement, death, or separation pursuant to 5 U.S.C. §§ 5551-5552. This is precisely the same claim for relief alleged in the Third Amended Complaint in Athey. 1
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Thus, in 1999, defendant was fully apprised by both of the Archuleta complaints that the putative class included former employees of the VA as well as employees of other Government agencies, and that the VA was identified as one of those agencies. The VA was identified as an agency that had employed some of the named plaintiffs by specific references to the named plaintiffs' last place of employment in Exhibit 1 attached to each complaint, and to plaintiffs' motion for leave to add additional plaintiffs. Moreover, on April 7, 1999, the Archuleta plaintiffs filed "PLAINTIFFS' MEMORANDUM OF POINTS AND AUTHORITIES IN SUPPORT OF THEIR MOTION FOR CLASS CERTIFICATION". As part of the typicality argument for class certification, plaintiffs explicitly identified "premium pay" claims against the VA, as follows (Pl. Brief, pp.14-15): In order to satisfy the typicality criterion, plaintiffs have included former Some of the specific examples cited in Archuleta complaints of the "pay" that the United States should have, but did not, include in the computation of the lump-sum payment included Sunday premium pay (see, Archuleta complaint, Para. 3(c)); "special or heightened rate of pay" (Archuleta class description, Para. 3(i)); Foreign area post allowances under 5 U.S.C. § 5924(1)(Archuleta complaint, Para. 3(d)); Physician's comparability allowance and Special Pay for Physicians and Dentists under 5 U.S.C. § 5471 and 38 U.S.C. Chap. 74, subchapter III (Archuleta complaint, Para. 3 (h)); and Nurses', Physician Assistants', and other health care professionals' additional and weekend duty pay pursuant to 38 U.S.C. § 7453 and § 7454 ("Introduction" to the Archuleta complaint as well as Para. 3(j)). Plaintiffs' Amended Complaint in Archuleta added claims with respect to general pay increases that the agencies of the United States had not included in the computation of the lump-sum payment for unused annual leave (Pl. Exhibit 6). The same claims are alleged in Athey with respect to the VA.
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1

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Federal employees who were employed by a number of agencies in different occupations and collectively received a variety of premium pay[s] which were not included in the computation of their lump-sum payment. For example plaintiffs... [identifying VA plaintiff Michael Clayton among others] were employed either by the Army, Air Force, Navy, VA...[and] were regularly scheduled to receive night pay, and/or Sunday pay.... Plaintiffs Margaret Cowles (LVN) and Thelma Curry (RN) were employed as Veterans Administration nurses (Occupational Code 664) in California. They regularly worked nights and weekends (including Sundays) and received nurses' and other health care professionals' additional pay, but those premium pays were not included in their lump-sum for unused annual leave. As early as September 24, 1999, the parties filed a joint motion to stay further proceedings in Archuleta as they began negotiations in pursuit of a settlement. On October 4, 1999, the Court granted the requested stay. The case continued to be stayed by a succession of Orders requested by joint motions of plaintiffs and defendant in order to enable the parties to conduct and complete complicated settlement negotiations. Finally, on February 2, 2006, the parties presented a motion for preliminary approval of a Settlement Agreement and Settlement Distribution Plan with respect to the former employees of 17 identified federal agencies which did not include the VA. On June 1, 2006, the Court conducted a Fairness Hearing to consider that settlement. The Court heard the joint requests of the plaintiffs, and the government, to approve the Settlement Agreement that resolved with finality the class action claims relating only to those 17 agencies. Accordingly, defendant's counsel, Ms. Snyder, informed the Court: "The government has looked at records from the 17 agencies that are included in the settlement, and other government and Plaintiffs' counsel have reviewed documents as well" (Transcript, Fairness Hearing, p. 13). The Court then took note of the unresolved claims pending against the VA in the Archuleta litigation. The Court stated: "The one thing we need to proceed with is the severed plaintiffs in this case, and what kind of schedule should we have to see what's happening with that group?" (Transcript, pp. 17-18).

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There can be no doubt whatsoever that the class action claims of these eight (8) VA plaintiffs were raised, but not resolved, in the Archuleta case from April, 1999 to June, 2006. Moreover, the parties were in total agreement to sever those class action claims without prejudice to a separate case with its own case number when on June 1, 2006--in settlement of Archuleta---this Court certified a class of employees who had been employed by 17 agencies other than the VA. The Athey case was created by this Court's Severance Order pursuant to the specific agreement of the United States, not because plaintiffs failed to file a complaint within the limitations period. Defendant's argument that the Athey case "is untimely" because it was filed 14 years too late is unquestionably baseless. It is rebutted completely by the history of this litigation. II. THERE IS NO BASIS WHATSOEVER FOR DEFENDANT'S ARGUMENT THAT PLAINTIFFS ENGAGED IN UNREASONABLE DELAY IN FILING THEIR COMPLAINT; THEREFORE, DEFENDANT'S THEORY BASED ON LACHES MUST FAIL

To support its alternative theory of dismissal based on laches, defendant once again pretends that the claims against the VA in the Athey case sprung forth for the first time on June 21, 2006 when the First Amended Complaint was filed pursuant to the schedule established by the Court. Inexplicably, defendant ignores the direct relationship between the filing of the Athey case and the settlement of the Archuleta case which was based upon the specific agreement of the Government to sever the claims against the VA "without prejudice" to a separate case. Defendant argues that the Athey case is barred by laches because: "Here, plaintiffs have known since before April 1993 of their claims against the VA and yet they did not file this complaint until June 2006". Def.'s Brief, p.13 (underlined emphasis in the

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original). But, the initial complaint in Archuleta was filed on April 7, 1999, thereby establishing the applicable starting point of the six-year limitations period as April 7, 1993 (28 U.S.C. § 2501). Defendant goes even further and shifts its alleged factual predicate by claiming: "It is clear that plaintiffs were aware of their claims as early as 1991, and most probably before then". Def.'s Brief, p. 13, fn. 4. As its only evidence of plaintiffs' alleged deleterious delay, defendant cites that plaintiff's counsel filed a case in the District Court in 1991 (Gaffney et al. v. United States, 824 F. Supp. 1 (D.D.C. 1991)) with respect to the computation of premium pay as part of a lump-sum payment upon retirement or separation. The District Court refused to certify a class. The named plaintiffs in Gaffney were GSA employees, not VA employees, and none of the named plaintiffs in Athey were named plaintiffs in Gaffney. And, to compound defendant's error even more, the named plaintiffs in Athey had not even retired or separated from the VA in 1991.2 Defendant acknowledges that the date of retirement or separation is the
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critical date for determining when their cause of action accrued. As this Court has recently reaffirmed, "`a claim accrues when all events have occurred that fix the alleged liability of the Government and entitle the plaintiff to institute an action'". Brian Entendencia v. United States, No. 06-515C, 2007 WL 851211 (Fed. Cl. March 19, 2007). Defendant has cited no reported precedent for the dubious principle that the class action claims of the Athey VA plaintiffs are barred by laches because their counsel had asserted a
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Archuleta plaintiff Michael R. Clayton separated on May 3, 1993 and plaintiff Thelma R. Curry retired on January 31, 1997; Robert M. Athey retired on December 31, 1995; Richard S. Droske retired on June 10, 1999; Ralph L. Fullwood retired on September 17, 1993; Paul D. Ising retired on September 28, 1998; Charles A. Milbrandt retired on January 2, 1999; and Troy E. Page retired on June 3, 1994; all subsequent to the April 7, 1993 date. Defendant did not raise the statute of limitations in the Archuleta litigation. The OPM, and the VA, possess the best evidence of the date of each plaintiff's retirement or separation. If defendant contests the accuracy of these dates of retirement or separation, plaintiffs intend to serve a written request for the admission of the truth of these facts pursuant to RCFC 36 as soon as the time specified by RCFC 26(d) permits. 13

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similar claim eight (8) years earlier in a different case for an entirely different group of plaintiffs, even before the cause of action had accrued for any of the named Athey plaintiffs. Nor has our research revealed any other case where the Department of Justice has asserted such a claim. Certainly, neither the Federal Circuit nor this court has ever so held. Cf., Catawba Indian Tribe of So. Carolina v. United States, 982 F.2d 1564, 1570 (Fed. Cir.1993). Plaintiffs' counsel's representation of a different group of plaintiffs in the Gaffney case in 1991 has no bearing on these right of these VA plaintiffs' to bring their own action in this court in 1999 after their own claims had accrued. As we have demonstrated, plaintiffs' claims involving the VA: (1) were filed as early as April, 1999 within each plaintiffs' limitations period as part and parcel of Archuleta; (2) those claims were unresolved in Archuleta; (3) the VA claims were severed from Archuleta by express agreement of the Government; and (4) the VA claims were transferred "without prejudice" by Order of this Court to a new case entitled Robert M. Athey et al. v. United States in June, 2006. Defendant's laches argument should be summarily dismissed by this Court as absurd on its face. The named plaintiffs in Athey did not wait 14 years after they retired or separated from employment with the VA to file their class action claims concerning the VA's failure to properly compute their lump-sum payments. Defendant knows full well that these class action claims specifically directed against the VA have been pending in this court for eight (8) years. Indeed, what the Athey case is really about is that these plaintiffs, and the entire class of former VA employees that they represent, have had to wait many years for their day in court while complex negotiations proceeded in Archuleta until the government agreed to settle with respect to 17 agencies other than the VA. Had those negotiations collapsed in 2006, the class action claims of the VA plaintiffs would have had to proceed forward as part of, and

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within, the Archuleta litigation along with the claims of all other federal employees regardless of which agency employed them. The claims with respect to the VA were "severed without prejudice" by order of this Court with the explicit concurrence of the Government.3 The time for resolution of these
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claims has finally arrived, yet the government persists in asserting legally baseless statute of limitations and laches arguments that are unworthy of any consideration.

III. DEFENDANT MISCHARACTERIZES THE INTERPLAY BETWEEN THE LUMP-SUM PAYMENT STATUTES AND NURSES' ADDITIONAL PAY PURSUANT TO TITLE 38

A. INTRODUCTION

Defendant's arguments with respect to the inclusion of "additional pay" for registered nurses, other health care professionals, and "hybrid" employees affect only a small number of
3
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The Federal Circuit revisited and clarified the laches doctrine in 1988 in Cornetta v. United States, 851 F. 2d 1372, 1375 (Fed. Cir. 1988)(en banc). Laches requires: (1) Unreasonable and unexcused delay in bringing the claim, and (2) material economic prejudice to defendant as a result of the delay. See also, Advanced Cardiovascular Systems, Inc. v. Scimed Life Systems, Inc., 988 F. 2d 1157, 1161 (Fed. Cir. 1993). Here, there was no unreasonable and unexcused delay as plaintiffs brought their class action claims in 1999 as part of the Archuleta case. Moreover, defendant has not carried its burden that the VA would suffer material economic prejudice as a result of the alleged "delay" inasmuch as it has been apprised of the substance of the claims specifically involving the VA since the very beginning of the Archuleta case in 1999, and all the evidence required to prove or disprove plaintiffs' claims consists of computer pay records maintained by the VA or OPM in the regular course of business. The duty to preserve relevant evidence for litigation attaches when suit is filed, and even whenever a party reasonably should know that the evidence may be relevant to anticipated litigation. AAB Joint Venture v. United States, 75 Fed. Cl. 432, 440 (2007). Here, the VA has been committed for decades by VA Directives to automating time and attendance records and payroll information; defendant can not claim, and has not claimed, that those computer records have been destroyed.
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the allegations in plaintiffs' pending Third Amended Complaint. See, Pl. Complaint, paragraph 2, subparagraphs 3-6, and 9. The majority of the allegations in the Complaint are unaffected by this section of defendant's Motion to Dismiss. The VA is an enormous agency with hundreds of thousands of employees. It operates more than 1,400 health care facilities and administers benefits to millions of veterans. It employs tens of thousands of persons who are administrators, clerks, security personnel, maintenance employees, etc.. These General Schedule ("GS") employees are appointed pursuant to title 5, U.S.C., and their basic pay as well as their entitlement to premium pay is governed entirely by provisions of title 5. In its motion to dismiss, defendant does not challenge the entitlement of these GS employees to the lump-sum payment. The VA also employs thousands of specialized health care professionals appointed pursuant to title 38, U.S.C., such as doctors, dentists, and nurses, whose basic pay and premium pay are governed by provisions contained in title 38. Another unique group employed by the VA includes other health care professionals (pharmacists, licensed vocational nurses, respiratory therapists, etc.) whose employment benefits are governed principally by the provisions of title 5, but they earn premium pay in the form of "additional pay" for night, weekend, on-call, and overtime work pursuant to provisions of title 38. These persons are referred to as "hybrid" employees. While the distinctions are confusing as to which VA employees' benefits and entitlements are governed by title 5 or by title 38, one legal premise is irrefutable: There is no dispute whatsoever that VA employees are federal employees as defined by 5 U.S.C. § 2105, and that all such salaried VA employees are covered by the lump-sum payment statutes, 5 U.S.C. §§ 5551-5553.

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The VA does not, and can not, contest the applicability of the lump-sum payment statutes to health care professional employees such as registered nurses, and hybrids, who are appointed under chapters 73 and 74 of title 38. Indeed, the Secretary has acknowledged that: "The provisions of 5 U.S.C., chapter 55, subchapter VI [§§ 55515553], which provide for lump-sum payment of annual leave, are for application to employees appointed under 38 U.S.C., chapter 73 and 74" (VA Handbook 5011, Part III, Chapter 3, section 12, April 15, 2002; VHA Supplement, MP-5, Part II, Chapter 7.11 (a)(1)). And, while physicians, dentists, nurses and other health care professionals are exempted from a number of enumerated provisions of title 5 and the Civil Service Reform Act, Congress chose not to exempt them from the lump-sum payment provisions of Chapter VI of title 5 (§§ 5551-5553). See, 38 U.S.C. § 7425 (a). B. OPM, AND THE VA, HAVE INTERPRETED THE WORD "PAY" IN THE LUMP-SUM "PAY" STATUTE TO INCLUDE PREMIUM PAY

Plaintiffs submit that the starting point for the statutory analysis here is the interpretation of 5 U.S.C. § 5551 (a), which is the operative statute upon which plaintiffs' class action claims depend. Section 5551 (a) requires that all of an employee's regular and customary "pay" be included in the lump-sum payment computation. That provision contains a mandate from Congress that, upon retirement or separation, each federal employee "is entitled" to receive a lump-sum payment for unused annual leave that "shall equal the pay (excluding any differential under section 5925 and any allowance under section 5928) the employee or individual would have received had he remained in the service until expiration of the period of annual or vacation leave".

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It is well established that the word "pay" in the lump-sum payment statute includes more than "basic pay". It also includes regularly earned premium pay for the following reasons: (1) Congress has entrusted the Office of Personnel Management ("OPM") with the authority to "prescribe regulations necessary for the administration" of the lump-sum payment statutes. 5 U.S.C. § 5553. OPM has issued Final Regulations interpreting Congress' use of the generic word "pay" in the lump-sum payment statute as including premium pay and as not limited to basic pay: "Issuing final regulations to limit lump-sum payments to those that are basic pay for retirement purposes would be contrary to the lump-sum payment law." 64 FR 36763, 36770 (July 8, 1999); (2) The Federal Circuit in Lanehart v. Horner, 818 F.2d 1574 (Fed. Cir. 1987) and Armitage v. United States, 991 F.2d 746 (Fed. Cir. 1993) interpreted Congress' use of the same word "pay" as encompassing both premium pay and basic pay when employees are paid for using "leave with pay". Over time, Congress enacted an overall statutory scheme instructing the agencies that federal employees are entitled to be paid all of their regularly earned "pay" whether they use annual leave or whether the employees receive money in lieu of using annual leave. In either instance, the annual leave statute (5 U.S.C. 6303) and the lump-sum payment statutes guarantee that when employees earn accrued and accumulated hours of paid vacation, the employees should receive their customary and regular compensation for that period of time. Inasmuch as the lump-sum payment for accrued and accumulated annual leave is in lieu of "leave with pay", the lump-sum payment statute and the "leave with pay" statutes are closely related. As the Federal Circuit noted, "While consistency is not necessarily the paramount imperative of statutory interpretation, we, like other courts, are close-minded enough to expect

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that administrative agencies ordinarily will construe the same term in closely-related statutes consistently." Butterbaugh, et al. v. Dep't of Justice, 336 F. 3d 1332, 1338 (Fed. Cir. 2003). Accordingly, consistency would be assured by construing "pay" to include premium pay in addition to basic pay in the interpretation of the lump-sum payment statute as well as in the "leave with pay" statutes. (3) Moreover, the VA Secretary agrees with the premise that the word "pay" is not restricted only to basic pay. The Secretary has adopted a policy which specifically includes a number of designated "types of premium pay under title 5 and title 38, to the extent such premium pay was actually payable to the employee" within the computation of the lump-sum payment. These premium pays include night differential under 5 U.S.C. § 5343 (f), standby duty pay, overtime pay under title 5 and the FLSA, supervisory differential, cost-of-living allowance, and foreign area post allowance in certain circumstances. See, VA Handbook 5007, Part IV, Chapter 3, Appendix B-7 (a) thru 11 (attached hereto as Pl. Ex. 8). But, based on the wording of § 7453 (i), the Secretary insists on selecting which premium pay to exclude from the computation of "pay" from the lump-sum pursuant to § 5551 (a), thus excluding regularly earned "additional pay" for night work, weekend work, overtime work, and on-call duty. But, Congress pointedly did not bar additional premium pay entirely from the lump-sum payment. Rather, Congress only cautioned agencies not to consider additional pay as "basic pay" in computing the lump-sum. The Secretary misinterprets the wording of subsection (i) by treating the terms "basic pay" in subsection (i) as interchangeable with the word "pay" in the lump-sum payment statute. Plaintiffs contend that the Secretary is wrong; there is an obvious disconnect between the two terms that undermines the premise of defendant's motion to dismiss.

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(4) Finally, section 7453 (a) of title 38 specifically recognizes the distinction between "basic pay" and premium pay ( entitled "additional pay") with the following injunction: "[a]In addition to the rate of basic pay provided for nurses, a nurse shall receive additional pay as provided by this section."(emphasis supplied). The language of subsection (a) demonstrates conclusively that Congress was fully aware of the distinction between basic pay and additional premium pay in the very same statute that limits additional pay from being considered as "basic pay" when computing the lump-sum payment for unused annual leave. And, as we shall demonstrate, when Congress wants to exclude a specific subset of "pay" from a payment of compensation, it does so with clarity. Defendant's reliance upon subsection (i) for that purpose does not meet this test. C. THE STATUORY SCHEME INCLUDES ALL FORMS OF "PAY" IN THE COMPUTATION OF "LEAVE WITH PAY"AS WELL AS THE LUMP-SUM PAYMENT FOR UNUSED ANNUAL LEAVE The "leave with pay" statutes and the lump-sum annual leave payment statute are analogous within title 5. Under this comprehensive statutory scheme, the statutes are closely related. The Court of Appeals for the Federal Circuit has unmistakably ruled that the "leave with pay" statutes of chapter 63, title 5, prohibit any reduction in an employee's regular and customary pay when the employee uses paid leave. Lanehart v. Horner, 818 F.2d 1574 (Fed. Cir. 1987) and Armitage v. United States, 991 F.2d 746 (Fed. Cir. 1993). Plaintiffs submit that the principle is precisely the same with respect to the lump-sum payment statute: premium pay must be included in the lump-sum payment whether it derives from a provision of title 5 or from a provision of title 38.

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In Lanehart, supra, federal firefighters who regularly and customarily were scheduled to work 38 hours of overtime each two week pay period brought suit to recover back pay and interest. Lanehart, 818 F.2d at 1575-77, 1576 n.8. Federal government agencies, including the VA, failed to pay them the same amount of wages when they used "leave with pay" as they would have earned if they had remained at work at their regular schedule instead of taking paid leave. See id. at 1576. The government argued that it did not owe the firefighters any overtime pay when they took leave because they did not work overtime during leave. Id. The firefighters countered that the obvious purpose of "leave with pay" was to ensure that employees would receive the same amount of "pay" while on leave as they would regularly and customarily earn while at work. Id. at 1578. The court of appeals agreed after analyzing the "leave with pay" statutes. The court noted that the meaning of the word

"pay" as used in the "leave with pay" statutes has consistently been construed for more than a century as encompassing the total compensation or remuneration normally and regularly received by an employee. Buttressing this conclusion is the fact that Congress has used more limited terms, rather than the generic term "pay," when it intended to refer to specific types of pay. For example, §§ 5504, 5542 and 5545 use the phrase "basic pay" and §§ 5542, 5545, 5546 and 5547 speak to "premium pay." Moreover, when Congress has intended to exclude certain types of remuneration from a pay statute it has done so with clarity. In 5 U.S.C. § 4109(a)(1), for example, Congress defined the quantum of pay as "all or a part of the pay (except overtime, holiday or night differential pay) of an employee...selected and assigned for training...." Id. at 1581-1582.

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The government also argued that the FLSA provisions of title 29 trumped the requirement of title 5 that all of the employee's regular "pay" must be included by virtue of the "leave with pay" statutes. See Lanehart, 818 F.2d at 1578, 1582. The court rejected that argument. The court concluded that leave with pay "in Title 5 means total compensation or remuneration normally and regularly received" even when the employee's regular compensation arises under a title of the United States Code other than Title 5. Id. at 1582-83. Six years later, in Armitage v. United States, 991 F.2d 746, 748, 751 (Fed. Cir. 1993), the court of appeals reaffirmed its holding in Lanehart when it considered the entitlement to Sunday premium pay of federal civilian police officers on paid leave who were regularly scheduled to work on Sundays. When the police officers worked on Sundays, they received a twenty-five percent premium pursuant to 5 U.S.C. section 5546(a). See id. at 748-49. The government argued that the premium pay statute required that work be "performed" on Sunday in order to receive the premium, and thus the police officers were not entitled to have the Sunday premium included in their "pay" when the employees were on annual, sick, or other paid leave rather than at their regular work station. Armitage, 991 F.2d at 750. The government also cited an Office of Personnel Management ("OPM") regulation that only employees who perform work on Sunday were entitled to the premium pay, and that the court of appeals should defer to OPM's statutory interpretation. Id. at 749-50. The court concluded otherwise:

As in Lanehart, we are faced with reading statutes potentially in conflict with one another in attempting to achieve harmony therebetween. The difficulty of this task is not altered by their existence in the same title. ...

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Also, as in Lanehart, the government's reliance on OPM's interpretations is to no avail. Ltr. 550 16 in this case, just as with Ltr. 551-5 Attach. 2 in Lanehart, expressly implements only the Sunday premium pay statute, and therefore as in Lanehart, does not aid our interpretation of the "leave with pay" statutes. Thus, consistent with and mandated by our decision in Lanehart, we hold as a matter of law that the appellees in this case are entitled to receive Sunday premium pay for hours regularly scheduled for work on Sunday, but which were not worked due to charged periods of authorized annual or sick leave. Id. at 750.
Neither Lanehart nor Armitage have been overruled or otherwise qualified, modified or weakened over the last 15 years. Indeed, both decisions have been followed by the Federal Circuit and this court in a succession of cases over the years: Abbot v. United States, 204 F.3d 1099, 1102 (Fed. Cir. 2000); Butterbaugh v. Department of Justice, 336 F.3d 1332 (Fed. Cir. 2003); Abreu v. United States, 948 F.2d 1229 (Fed. Cir. 1991); Acton v. United States, 932 F.2d 1464 (Fed. Cir. 1991); Barnes v. United States, 72 Fed. Cl. 6 (2006); Barnes v. United States, 68 Fed. Cl. 492 (2005); Bull v. United States, 65 Fed. Cl. 407 (2005); Curry v. United States, 66 Fed. Cl. 593 (2005)4; Grandits v. United States, 66 Fed. Cl. 519 (2005); Abrams v.
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Judge Wolski's ruled in Curry that the government violated both title 5 and VA regulations by refusing to pay premium pay to hybrids, nurses, and other VA health professionals when they used paid leave. The government tried to argue that the subsection (i) exclusion applied to all statutes based on pay including the "leave with pay" statutes. The court rejected defendant's argument as "not interpreting [the statute]; it is legislating--which is not a job for the courts". Curry, id, at 600. Judge Wolski also commented with respect to the meaning of subsection (i), but it was plainly obiter dicta as the VA's application of the lump-sum payment statute was not in issue on the merits. Curry did demonstrate yet another instance where the VA refused to obey Congress' mandate by misapplying the plain meaning of the statute. Congress enacted a provision of the 1997 Appropriations Act that Sunday pay was no longer to be paid unless the employee actually performed work on Sunday. The VA promptly instructed its personnel that "Sunday" meant "Saturday" as well. The VA argued in Curry that Congress had sent "a signal" to the courts that premium pay could not be paid to VA employees during leave with pay. The court rejected the argument and admonished the VA, id., fn 13: "But clearly `Sunday' does not mean `Saturday and Sunday,' nor does it mean `nighttime'. And the only signal that counts is the law itself; `the Congress does what it says and means what it says.' Contreras v. United States, 64 Fed. Cl. 583, 592 (2005)'[additional citations omitted]." And, in James v. Von Zemenszky, 284 F.3d 1310 (Fed. Cir. 2002), rehearing denied, 301 F. 3d 1364 (Fed.Cir. 2002), the court overturned yet another attempt by the VA to try to use a provision of title 38 to trump employee protections embodied in title 5 statutes.
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United States, 57 Fed. Cl. 439 (2003); Berg v. United States, 49 Fed. Cl. 459 (2001); Abramson v. United States, 42 Fed. Cl. 621 (1998); Abbott v. United States, 41 Fed. Cl. 553 (1998); Aamold v. United States, 39 Fed. Cl. 735 (1997); Adams v. United States, 27 Fed. Cl. 13 (1992). D. LEGISLATIVE HISTORY OF THE LUMP-SUM LEAVE PAYMENT The genesis of the statutory scheme that ultimately became §§ 5551-5552 with respect to unused annual leave was the experience of the United States government during the World War II. The government needed to fill civil service positions that were necessary to the war effort when federal employees were being inducted into the armed services in large numbers. The underlying premise of the legislation was that, in practice, the employees would receive their total compensation when they used up their accumulated and accrued "terminal leave" and then exited federal employment. Congress concluded that the employees might as well be paid that same sum of money as a lump-sum to facilitate their exit from federal employment with their unused annual leave intact. The General Accounting Office summed up the legislation as follows: To expedite entry of federal civilian employees into the Armed Forces during World War II, Congress authorized agencies to make lump-sum payments for accumulated, unused annual leave to employees who were separating from federal civilian service to enter the armed forces. Previously, the Dual Compensation Act had prohibited federal civilians entering the armed services from receiving compensation from both civilian office and military pay if the combined amounts exceeded $2,000 per year and agencies were not authorized to "buy back" an employee's accumulated, unused leave. When employees retired or otherwise left federal service, agencies commonly carried them on the payroll in a "terminal leave" status until they had exhausted all unused annual leave. These practices potentially could have delayed federal civilian employees' entry into military service until their leave was exhausted. Agencies' authority to buy back a separating employee's accumulated, unused annual leave was extended to all employees in 1944 (58 Stat. 845). Under this statute, any employee who leaves federal service with unused annual leave is to receive a lumpsum payment for that accumulated leave. The lump-sum payment is calculated based on the pay that the employee would have received for the leave, as if the employee had

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remained in service until the leave was exhausted. To illustrate the calculation method, if an employee's date of separation had been January 3, 1997, and he or she had 200 hours of unused annual leave, the lump-sum leave payment would have been calculated as if the employee actually worked an additional 25 days, excluding any holidays. U.S. Gen. Accounting Office, Report Number GGD-97-100, Federal Civilian Personnel: Cost of Lump-Sum Annual Leave Payments to Employees Separating from Government, Letter: 2 (May 29, 1997). OPM then issued final regulations that "establish a uniform Governmentwide policy for calculating lump-sum payments for accumulated and accrued annual leave for employees who separate from Federal service in accordance with 5 U.S.C. 5551 or 5552." OPM Memorandum for Directors of Personnel and Agency Payroll Offices (CPM 99-2). OPM explained its interpretation of the statute as follows: The term ``pay'' is not further defined in law. In the final regulations, we have interpreted this term to mean the pay the employee would have received on a biweekly basis had he or she remained in Federal service on annual leave. The components of two large agencies commented that any pay excluded from retirement basic pay should also be excluded from lump-sum payments for annual leave. In effect, this would limit a lump-sum payment to basic pay and certain types of premium pay, such as annual premium pay under 5 U.S.C. 5545(c)(1) and (2) and 5545a. One of the agencies stated that it would support a final regulation limiting lump-sum payments to basic pay, excluding FLSA overtime pay. In addition, an individual commented that a lump-sum payment should not be adjusted to include any extra pay or benefits such as Sunday premium pay, night pay, or any general pay adjustments or within-grade increases that become effective after the employee separates from Federal service. Under 5 U.S.C. 5551, a lump-sum payment ``must equal the pay (excluding any differential under section 5925 and any allowance under section 5928) the employee or individual would have received had he remained in the service until expiration of the period of the annual or vacation leave.'' Issuing final regulations to limit lump-sum payments to those that are basic pay for retirement purposes would be contrary to the lump-sum payment law.... Under 5 U.S.C. 5551, a lump-sum payment must equal the pay an employee would have received had he or she remained in Federal service until expiration of the period of annual leave (excluding any differential under section 5925 and any allowance under section 5928). 64 FR 36766, 36770 (July 8, 1999).5
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Defendant's brief cites Gaffney v. United States, 834 F. Supp. 1,4-5 (D.D.C. 1993), for the proposition that limiting the lump-sum payment only to basic pay was "permissible, reasonable, and entitled to deference". Def. Brief, p.8. However, OPM's subsequent Final Regulation (and the VA Handbook), that interprets "pay" as not limited to basic pay in the computation of lump-sum payments, entirely undercuts the District Court's analysis in Gaffney and renders that decision irrelevant as well as erroneous.
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E. DEFENDANT'S RELIANCE ON § 7453 (i) IS MISPLACED As may be expected in healthcare facilities that must function twenty-four hours per day, "additional pay" is paid to VA registered nurses, other health care professionals, and hybrid employees for working a regular schedule of hours at night, on weekends, overtime, and in other situations pursuant to 38 U.S.C. §§ 7453-7454. Section 7453 (b) provides premium pay for night work between 6 p.m. and 6 a.m.; § 7453 (c) provides premium pay for weekend work commencing at midnight Friday; § 7453 (d) provides for holiday pay; § 7453 (e) provides overtime pay; and § 7453 (h) provides for premium pay for on-call duty. The Secretary has acknowledged in the VA Handbook that the lump-sum payment includes premium pay in addition to basic pay. Consequently, the only conceivable argument for excluding additional pay earned under § 7453 (b)-(h) from the lump-sum is the wording of § 7453 (i) (italics supplied): (i) Any additional pay paid pursuant to this section shall not be considered as basic pay for the purpose of the following provisions of title 5 (and any other provision of law relating to benefits based on basic pay): (1) Subchapter VI of chapter 55 [the lump-sum payment statutes]. (2) Section 5595. (3) Chapters 81, 83, 84, and 87. Throughout its brief, defendant just slides over the distinction between "pay" in § 5551 (a) and "basic pay' in § 7453 (i) as if the two terms were identical. The VA argues that subsection (i) operates as a complete barrier to the inclusion within the lump-sum payment of any additional pay delineated in § 7453 (b) through (h). Plaintiffs disagree with the VA's interpretation of subsection (i). Unmistakably, the lump-sum payment statute under which plaintiffs claim back pay and interest requires a

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computation including the entire compensation, i.e., the "pay" (not just "basic pay") that the retiring or separating employee would have received had he or she remained in the government's employ for the remainder of the period of unused annual leave. In Mudge v. United States, 308 F. 3d 1220, 1227-28 (Fed. Cir. 2002), the court of appeals rendered a statutory interpretation of the word "administrative" in 5 U.S.C. § 7121 (a)(1). The court's analysis and reasoning there is compelling precedent to aid this Court in its interpretation of subsection (i): It is beyond debate that statutory interpretation begins with the language of the statute. See Hughes Aircraft Co. v. Jacobson, 525 U.S. 432, 438 (1999) ("As in any case of statutory construction, our analysis begins with the language of the statute.") (internal quotation omitted); Blue Chip Stamps v. Manor Drug Stores, 421 U.S. 723, 756 (1975) ("The starting point of every case involving construction of a statute is the language itself."); Weddel v. Sec'y of Dep't of Health & Human Servs., 23 F.3d 388, 391 (Fed. Cir. 1994) ("Under the traditional rule of statutory interpretation, courts must look first to intrinsic evidence of intent (i.e., the textual language) alone."). Accordingly, we begin our inquiry with the text of the CSRA itself. Section 7121(a)(1) directs that, with a few enumerated exceptions, the negotiated grievance procedures set forth in a federal employee's CBA are to be "the exclusive administrative procedures for resolving grievances that fall within [the CBA's] coverage." 5 U.S.C. § 7121(a)(1) (2000) (emphasis added). Because the statute does not define the word "administrative," see 5 U.S.C. § 7103, we presume that Congress intended to give that term its ordinarily understood meaning, see Asgrow Seed Co. v. Winterboer, 513 U.S. 179, 187 (1995) ("When terms used in a statute are undefined, we give them their ordinary meaning.") (internal citation omitted). There can be no doubt that "basic pay" is a sub-set of "pay". "Basic pay" is a commonly understood and applied term-of-art which is referred to by Congress through the United States Code. "Basic pay" is defined by OPM as well as by the Secretary's own regulations in the VA's own regulatory Handbook, as the rate of compensation paid to federal employees equivalent to a regular salary on an annual basis ("Rate of basic pay means the rate of pay fixed by law or administrative action for the position held by an employee before any

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deductions and exclusive of additional pay of any kind" 5 CFR § 531.202; 5 CFR § 550103; "The rate of pay fixed by law or administrative action for the position held by an employee before any deductions and exclusive of additional pay of any kind." VA Handbook 5007, Part IV, Chapter 3, subsection 6 (e)). There is simply no case to be made that "basic" pay" and "pay" are synonymous. By its very definition, "basic pay" necessarily is "exclusive of additional pay of any kind", while "pay" has been consistently interpreted to include premium pay in addition to basic pay. Inasmuch as the plain meaning of "basic pay" is so well established by statute and regulation, it is not susceptible of any contrary interpretation, and the Court simply can not strip away the word "basic" from the phrase "basic pay" in § 7453 (i) to render it as interchangeable with "pay" in § 5551 (a). In short, the adjective "basic" cannot be simply and safely ignored. Congress must be deemed to have intended precisely what is meant by the plain meaning of "basic pay". See, Williams v. Taylor, 529 U.S. 362, 404 (2000) ("It is . . . a cardinal principle of statutory construction that we must `give effect, if possible to every clause and word of a statute.' United States v. Menache, 348 U.S. 528, 538-39 (1955)." (additional citations omitted)). In § 5551 (a), Congress completely barred two categories of premium pay from being included in the lump-sum computation-- "any differential under section 5925 and any allowance under section 5928". Unquestionably, Congress explicitly excluded those two premium pay provisions from inclusion in the computation of the lump-sum payment with clarity. Courts can only conclude that Congress certainly knows how to exclude such subsets of "pay" from the lump-sum computation when it wanted to do so, but it did not intend such a result when it enacted subsection (i). See also, i.e., 5 U.S.C. § 4109 (a) (1), where Congress

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was specific in excluding subsets of "pay" with respect to expenses of training: an agency may "pay all or part of the pay (except overtime, holiday or night differential pay) of an employee...." The inevitable conclusion of this analysis, in conformity with the rules of statutory construction, is that Congress definitely excluded nurses' additional pay from being "considered as basic pay" when lump-sum payments are calculated, but it is equally clear that Congress did not bar such additional pay from being considered as premium pay in the calculation of "pay" which is the broader generic terminology used in § 5551 (a). In arguing that the "basic pay" provision of 38 U.S.C. § 7453 (i) trumps the term "pay" in 5 U.S.C. § 5551 (a), defendant also relies on 38 U.S.C. § 7425 (b) which provides that no section of title 5 that is "inconsistent" with a provision of title 38 "shall supercede, override, or otherwise modify" any provision of title 38. In this regard, defendant reverses field, arguing that the two statutes are inconsistent one with the other. Defendant's premise is exactly the opposite of its first line of defense that basic pay in subsection (i) is one and the same with "pay" in the lump-sum statute. However, § 5551 (a) is not "inconsistent" with § 7453 (i) because the court can harmonize the two statutes, one with the other. The two statutes serve two separate, not inconsistent, objectives or functions: subsection (i) only guarantees that additional pay shall not be included in basic pay when the lump-sum calculations are made, while § 5551 (a) guarantees that basic pay plus regularly earned premium pay is to be included in the lump-sum payment unless specifically excluded by Congress. As a test of whether § 5551 (a) is inconsistent with subsection (i), assume that subsection (i) was never enacted. In that circumstance, the lump-sum payment statute would stand alone as mandating that all of the employees' "pay", including premium pay, would be

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included in the lump-sum computation. The subsequent enactment of subsection (i) in title 38 does not in any way cancel out § 5551 (a). Subsection (i) only restricts additional pay from being considered as basic pay, not as "pay". There is no way to read subsection (i) as replacing § 5551 (a) with respect to the treatment of additional pay by authorizing the VA to ignore the language of the lump-sum payment in its entirety and to substitute the language of subsection (i) instead. Thus, the two statutes are not mutually exclusive, as the government argues, unless the Court rewrites § 7453 (i) to discard the word "basic" from the phrase "basic pay", or the Court rewrites § 5551 (a) to insert the word "basic" before the generic word "pay". In either instance, the Court would usurp the legislative function, an obviously undesirable and unacceptable result. The teaching of the Lanehart decision provides a comparable analogy. There, the government was arguing that overtime pay under title 29 could not be paid as part of "leave pay" under title 5 because the employees obviously did not work overtime when they used paid leave. In Abreu v. United States, 22 Cl. Ct. 230, 236 n.8 (1991) aff'd 948 F.2d 1229 (Fed. Cir. 1991), this court analyzed the Federal Circuit's rejection of that argument as follows: The effect of that decision [Lanehart] was not to eliminate distinctions between the two statutory schemes. The narrow issue in that case involved construction of the Title 5 leave with pay provisions. The court held that the wording of those statutes required, in effect, an incorporation into Title 5 pay of calculations made under Title 29, even though Title 29 would not independently have permitted a recovery." Abreu v. United States, 22 Cl. Ct. 230, 236 n.8 (1991) aff'd 948 F.2d 1229 (Fed. Cir. 1991) ("Abreu II"). Similarly, defendant's construction of § 7453 (i) must be rejected as a misreading of the interplay between the two statutes because it erroneously assumes that the

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"basic pay" referenced in § 7453 (i) is not a subset of "pay" in § 5551 (a). Defendant refuses to recognize that the two statutes can be given effect without one provision canceling out the other, and that the lump-sum pay statute of title 5 is not "inconsistent" with subsection (i) of title 38. F. THE INTERPLAY BETWEEN THE LUMP-SUM LEAVE PAYMENT STATUTE AND THE LIMITATION UPON CONSIDERING ADDITIONAL PAY AS BASIC PAY IN SECTION 7453 (i)

Defendant's reliance upon Congress' use of the phrase "basic pay" in § 7453 (i) raises the following questions: Was Congress confused in drafting § 7453(i) between "additional pay" and "basic pay" and actually intended to bar any additional pay from inclusion in the lump-sum payment computation? Did Congress not realize that there was a distinction between "basic pay", "additional pay', and "pay" when it enacted § 7453 (i)? Can it be rationally said that Congress legislated "with clarity" the exclusion of all additional pay from the lump-sum computation of "pay" when it directed that additional pay "shall not be considered as basic pay"? There can be no question as to the plain and universally accepted meaning of "basic pay". Therefore, plaintiffs contend that it is not permissible for a court to speculate as to what Congress may have intended. The wording of the statute that was actually enacted leaves no doubt as to its plain meaning. See Lamie v. United States Tr., 540 U.S. 526, 534 (2004) ("The starting point in discerning congressional intent is the existing statutory text . . . ."); Holloway v. United States, 526 U.S. 1, 6 (1999) ("[T]he language of the statutes that Congress enacts provides the most reliable evidence of its intent. For that reason, we typically begin the task of statutory construction by focusing on the words that the drafters have chosen."); AFGE, Local 3295 v. FLRA, 46 F. 3d 73, 78 (D.C. Cir. 1995) ("Petitioner asks us to assume that Congress

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was confused but offers no support for that dicey proposition. Petitioner's hypothesis, moreover, is flatly inconsistent with the familiar principle that Congress legislates with a full understanding of existing law. See, e.g., Miles v. Apex Marine Corp., 498 U.S. 19, 32, 111 S.Ct. 317, 325-26, 112 L.Ed.2d 275 (1990); Cannon v. University of Chicago, 441 U.S. 677, 696-97, 99 S.Ct. 1946, 1957-58, 60 L.Ed.2d 560 (1979)"). As plaintiffs have noted, supra, in Lanehart v. Horner, 818 F.2d 1574, 1581 (Fed. Cir. 1987), the Federal Circuit parsed the word "pay" in the "leave with pay" statutes with the following observation: "...Congress has used more limited terms, rather than the generic term `pay,' when it intended to refer to specific types of pay. For example, §§ 5504, 5542 and 5545 use the phrase `basic pay' and §§ 5542, 5545, 5546 and 5547 speak to `premium pay.' Moreover, when Congress has intended to exclude certain types of remuneration from a pay statute it has done so with clarity." In the very first sentence of the same statute, § 7453 (a), as subsection (i), Congress clearly recognized the distinction between additional pay and basic pay: "(a) In addition to the rate of basic pay provided for nurses, a nurse shall receive additional pay as provided by this section." It is folly even to suggest that Congress misunderstood the terminology. For this Court to hold as defendant asks would be to defy the preeminent canon of statutory interpretation that a court must "presume that the legislature says in a statute what it means and means in a statute what it says there." Bedroc Ltd. v. United States, 541 U.S. 176, 183 (2004). Defendant's contention that the language of section 7453(i) operates to exclude all forms of additional pay under 38 U.S.C. §§ 7453-7454 from lump-sum payment computations is fundamentally flawed in that it requires the Court to perform a legislative, not a judicial, function by rewriting section 7453(i) to remove the word "basic" from the phrase "basic pay".

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G. LEGISLATIVE HISTORY OF 38 U.S.C. § 7453 (i) In this section of Plaintiffs' Opposition to Defendant's Motion to Dismiss, we discuss the legislative history of 38 U.S.C. § 7453(i), which concerns the characterization of additional pay for nurses and "hybrid" employees of the Department of Veterans Affairs. 1. The Veterans Health Care Expansion Act of 1973 Additional pay provisions for VA nurses were originally enacted as part of the Veterans Health Care Expansion Act of 1973, Pub. L. No. 93-82, 87 Stat. 179 (1973). The Act added a new subsection (e) to what was then Section 4107 of Title 38, entitled "Grades and Pay Scales." Subsection (e)(1) provided for additional compensation as specified in paragraphs (2) through (8) of that subsection, namely night premium pay, weekend premium pay, holiday pay, overtime pay, and "on call" premium pay. Significantly, subsection (e)(1) specified that the enumerated premium pay shall be "in addition to the rate of basic compensation provided for nurses in subsection (b)(1)...." Subsection (e)(9) then provided: "Any additional compensation paid pursuant to this subsection shall not be considered as basic compensation for purposes of subchapter VI and section 5595 of subchapter IX of chapter 55, chapter 81, 83, or 87 of title 5, or other benefits based on basic compensation."

For purposes of the exclusion now appearing in 38 U.S.C. § 7453 (i)(1), the statute has remained substantively unchanged since its enactment in 1973.6 Thus, §7453(i) was enacted at
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the same time as premium pay in the form of "additional pay". Congress therefore knew the distinction between "basic pay" and "additional pay," and if it had wanted to exclude additional pay entirely from Chapter 63 Part VI, it could have done so by declaring that the "additional" pay enumerated in the statute shall not be considered as "pay" for purposes of
Pub. L. no. 94-581, 90 Stat. 2848 (1976) substituted "pay" for "compensation" in several places in subsection (e), including in (e)(9). This is consistent with earlier changes enacted in 1966 applicable to Title 5 of the United States Code. See Pub. L. No. 89-554, 80 Stat. 488 (1966).
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Subchapter VI of chapter 55, rather than just "basic pay." Alternatively, Congress could have amended 5 U.S.C. § 5551(a) to exclude 38 U.S.C. §§ 7453 and 7454, as it explicitly did in entirely excluding sections 5925 and 5928. 2. Congressional Intent

The relevant House Report explains that the basic purpose of the bill "is to improve the ability of the Veterans' Administration to deliver quality medical care to its beneficiaries by...[among other things] improving the personnel system of the Department of Medicine and Surgery (DM&S)...and to make DM&S more attractive to skilled health care personnel and thus more able to compete for scarce health care manpower...." H.R. Rep. No. 368, 93rd Cong.
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(1973), reprinted in 1973 U.S. Code Cong. & Ad. News, 1688, 1689. With specific regard to the additional pay provisions, the House Report explains: New subsection (e) establishes overtime and premium pay benefits for VA nurses (and it is intended that this provision shall be applied