Countries quite often refuse to extradite people to the united states and it doesn't end in international crisis. Britain just did it recently because the defendant was depressed or something.

As for this case, I can't for the life of me figure out the Italian appellate process. How did the trial court find guilty and the appeals court find acquittal? Appeals courts in the states don't find guilt or innocence- that is for the finder of fact. Instead, they either affirm or order new trials based on technical or legal problems with the underlying case. So is the media reporting this incorrectly or does each level of the appeals process have some sort of bizarre finder of fact power? Is each successive appeal considered by the court de novo? If it was a retrial, did the appeals court find a technical error or can they weight the evidence?