Free Published Opinion/Order - District Court of Federal Claims - federal

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In the United States Court of Federal Claims
No. 05-608 C (E-Filed under seal: June 24, 2008) (E-Filed for publication: July 22, 2008)

FRANCISCO JAVIER RIVERA AGREDANO, Plaintiff, v. THE UNITED STATES, Defendant.

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Trial; Breach of Implied-in-Fact Covenant; Failure to Remove Contraband From Seized Vehicle Prior to Resale Constitutes Breach of Impliedin-Fact Covenant; Damages for Injuries Caused by Breach.

Teresa Trucchi, San Diego, CA, for plaintiff. Devin A. Wolak, Washington, DC, with whom were Jeffrey S. Bucholtz, Acting Assistant Attorney General, Jeanne E. Davidson, Director, and Patricia M. McCarthy, Assistant Director, Commercial Litigation Branch, Civil Division, Department of Justice, Washington, DC, for defendant. Erik J. Gantzel, U.S. Customs and Border Protection, U.S. Department of Homeland Security, San Diego, CA, of counsel.

OPINION 1

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Footnote 1 to the Opinion E-filed under seal on June 24, 2008 stated:

This Opinion is filed under seal. If any party believes that this Opinion contains protected material that should be redacted before publication, that party shall, by motion to be filed on or before July 8, 2008, request that such protected material be redacted. The motion shall indicate the specific protected material as to which redaction is requested and, with respect to each such proposed redaction, the (continued...)

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HEWITT, Judge I. Introduction

(...continued) reason(s) for the request. Opinion filed June 24, 2008 1 n.1. On July 8, 2008, defendant filed its Motion to Redact Final Order (Redact Motion or Redact Mot.). Redact Mot. 1. In its Redact Motion, defendant requested the court to redact certain portions of the court's Opinion of June 24, 2008 "to avoid compromising the efforts of United States Customs and Border Protection . . . to protect the U.S.-Mexico border by publicly disclosing the specific means and methods by which they carry out their law enforcement duties." Id. In support of its Redact Motion, defendant submitted a copy of the protective order in this case, which had been issued by the United States District Court for the Southern District of California before the case was transferred to this court. See Redact Motion, Ex. B, 1. On July 10, 2008, plaintiff filed its Notice of Non-Opposition to Defendant USA's Motion to Redact Final Order (Pl.'s Notice), stating that plaintiff does "not oppose . . . [defendant's] requests as set forth in the [Redact Motion] filed July 8, 2008. Pl.'s Notice 1-2. The court accepts the protective order issued in this case by the United States District Court for the Southern District of California as the law of the case. Thus, the issue before the court is whether the protective order should be modified in order to enable the court to publish this Opinion in its entirety without incorporating defendant's proposed redactions. The Federal Circuit has held "that a court may enter a protective order if `good cause' exists to protect discovery information" but that "a presumption of public access to judicial records" exists. Baystate Techs., Inc. v. Bowers, 2008 U.S. App. LEXIS 14686, at *4 (Fed. Cir. July 10, 2008) (table) (citing Siedle v. Putnam Invs., Inc., 147 F.3d 7, 9 (1st Cir. 1998); Poliquin v. Garden Way, Inc., 989 F.2d 527, 533 (1st Cir. 1993)). The Federal Circuit further stated that "in determining whether a protective order should be modified, the court must balance the privacy interests of the parties against the public interest in access to the discovery information." Id. at *4-5 (citing Siedle, 147 F.3d at 10). The court finds that a balancing test is not necessary in this case to determine whether the protective order should be modified. Defendant has requested redactions of portions of the Opinion that describe the policies and procedures used by United States Customs and Border Protection, Redact Mot. passim, and plaintiff does not oppose those redactions, Pl.'s Notice 2. The court determines that the portions of the Opinion requested by defendant to be redacted contain information that is not available to the public. For these reasons, the court accepts defendant's requests contained in its Redact Motion. 2

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This case is before the court following a trial2 on a claim by plaintiff, Francisco Javier Rivera Agredano (Mr. Agredano or plaintiff), for breach of contract against the government (government or United States or defendant). The court heard testimony from

A number of the witnesses presented at trial were Spanish speakers and required interpreters to translate their testimony into English for the court. Under Federal Rules of Evidence (FRE) 604, "An interpreter is subject to the provisions of these rules relating to qualification as an expert and the administration of an oath or affirmation to make a true translation." FRE 604 (2006). The court required each interpreter to undergo a voir dire by the counsels and the court and then to take the oath administered to every witness. The court qualified each interpreter as an expert in the Spanish language. Agredano Trial Transcript (Tr.) 10:7-9; 14:20-22; 753:6-8. For convenient reference, the names, in alphabetical order, and a description of the interpreters, upon whose live translation the court relies in this opinion, follow: Ms. Eugenia Arguello trained as an English as a Second Language (ESL) teacher at the national university of Mexico; she served as an ESL teacher for fourteen years. Id. at 751:4-10. She then attended Southwestern College in the United States and trained to be an interpreter for two and a half years. Id. at 751:12-14. She has a California Certificate for Interpreters and a Federal Interpreter Certificate. Id. at 751:17-19. She has been qualified as an expert in the Spanish language in the federal district courts in San Diego and Albuquerque. Id. at 751:24752:4. Ms. Arguello has worked as an interpreter for sixteen years, id. at 752:14, and she has held her California certification for fourteen years, id. at 752:19-24, and her federal certification for more than ten years, id. at 752:25-753:5. The court qualified Ms. Arguello as an interpreter of the Spanish language in the trial. Id. at 753:6-8. Ms. Gloria Mayne has an undergraduate degree in economics, graduate courses in marketing, communication, and business administration, and a certificate degree from the University of California San Diego in translation and court interpreting. Id. at 7:13-17. She also has numerous certifications from the Judicial Council of California for various courses taken in interpreting and translation. Id. at 7:17-8:1. Ms. Mayne has been certified in the state of California as a court interpreter for almost seventeen years. Id. at 8:7-9. She has been certified as an interpreter by the United States District Courts for five years. Id. at 8:12-14. She has worked as an interpreter in criminal and civil proceedings in California for seventeen years. Id. at 8:9-12. The court qualified Ms. Mayne as an interpreter of the Spanish language in the trial. Id. 10:7-9. Ms. Ruth Monroy has a law degree from the University of Mexico and is certified as a court interpreter of the Spanish language for the California state courts and the United States District Courts. Id. at 13:10-16. She has been certified as an interpreter for the federal courts for approximately nineteen years. Id. at 14:16-19. The court qualified Ms. Monroy as an interpreter of the Spanish language in the trial. Id. 14:20-22. 3

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nineteen witnesses 3 and received some thirty-nine exhibits in trial. Agredano Trial For convenient reference, the names, in alphabetical order, and a description of the witnesses upon whose live testimony the court relies in this opinion follow: Mr. Jayson Ahern is a fact witness for plaintiff. Plaintiff Francisco Javier Rivera Agredano's Witness List, filed Jan. 8, 2008 (Pl.'s Wit.) 6. He currently works as the Deputy Commissioner of the United States Customs and Border Protection (Customs). Tr. 565:18-20. From March 1, 2003 to August 2007, Mr. Ahern worked as the Assistant Commissioner for the Office of Field Operations within Customs. Id. at 566:1-7. From May 2002 to March 2003, he was the Assistant Commissioner for the Office of Field Operations with the United States Customs Service (USCS), which was then reorganized as Customs. Id. at 566:9-13. From January 2001 to May 2002, Mr. Ahern was the Director for the Southern California Customs Management Center in San Diego, id. at 566:15-19, and before that, he was the Port Director for Operations of Customs in Los Angeles, id. at 567:1-2. Mr. Francisco Javier Rivera Agredano is the plaintiff in this case and a fact witness for plaintiff. Pl.'s Wit. 2. He is forty-five years old and resides in Tijuana, Mexico. Tr. 44:16-19. He works in the printing business as a printer, a job that he has held for twelve years. Id. at 44:20-21; 45:11-12. He has a technical degree in accounting. Id. at 45:15. Mr. Rivera Agredano is married to Maria del Carmen Calderon, with whom he has two daughters. Id. at 44:20-45:4. Mr. Robert Bickers is a fact witness for plaintiff. Pl.'s Wit. 9. He currently works as a Customs and Border Patrol Supervisor for Customs. Tr. 261:13-18. He first began working for the USCS in 1991 as an Inspector at the port of entry. Id. at 261:23-262:5. In 2001, he served as a Supervisor for the Contraband Enforcement Team. Id. at 263:8-13. In his current position, Mr. Bickers trains new inspectors. Id. at 262:23-24. Dr. Jesus Manuel Cesea Caro is a fact witness for plaintiff. Pl.'s Wit. 14-15. He has worked as a medical doctor for twenty-five years. Tr. 754:18-20. He currently practices in gerontology at the Issste Hospital in Tijuana, Mexico and his private practice. Id. at 754:22; 755:19-20. He studied medicine at the Autonomous University in Guadalajara, Mexico. Id. at 755:5-6. He specialized in family medicine at the Issste Hospital in Tijuana, Mexico and pursued a sub-speciality in gerontology at the Lopez Mateos Hospital in Mexico City, Mexico. Id. at 755:6-9. Mr. Lawrence Fanning is a fact witness for plaintiff, Pl.'s Wit. 8-9, and a fact witness for defendant, Defendant's Witness List (Def.'s Wit.) 4. He currently works as an Assistant Port Director at Otay Mesa Cargo. Tr. 448:2-3. From October 2000 through 2007, Mr. Fanning served as a Fines and Penalties Officer. Id. at 448:6-19. Mr. Robert Hood is a fact witness for plaintiff, Pl.'s Wit. 10, and defendant, Tr. 243:16(continued...) 4
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(...continued) 244:18. He is a Deputy Assistant Port Director for Customs at Otay Mesa. Id. at 185:18-186:8. He first worked as a Customs Inspector for USCS in 1987. Id. at 186:1-2; 186:12-14. At that time, he worked in secondary inspections and, over the years, he has worked in cargo, commercial, and airport operations. Id. at 186:18-21. He became a Senior Inspector in 1991 and a Supervisory Customs Inspector in 2000. Id. at 187:8-10. In 2004, he became a Supervisory Customs and Border Protection Officer, and he was promoted to Chief Customs and Border Protection Officer. Id. at 187:10-14. In October 2007, Mr. Hood became Deputy Assistant Port Director. Id. at 187:14-16. Mr. Alfonso Calderon Leon is a fact witness for plaintiff. Pl.'s Wit. 3. He was a plaintiff in this case when the complaint was first filed. Id.; see Complaint (Compl.) ¶ 5. He is thirtynine years old, and he works with Messrs. Agredano and Gabriel Calderon in a print shop. Tr. 94:21-95:1. He has worked at the print shop for approximately fifteen years. Id. at 95:4-5. Mr. Rivera Agredano is married to Mr. Calderon's sister. Id. at 95:6-8. Mr. Gabriel Calderon Leon is a fact witness for plaintiff. Pl.'s Wit. 15. He is thirty-five years old and works as a printer with his brother-in-law, Mr. Agredano. Tr. 520:8-15. He lives in Tijuana, Baja California, Mexico. Id. at 520:16-17. Ms. Juliet Calip is a rebuttal witness for defendant. Tr. 676:18-22. She works as a paralegal specialist for U.S. Immigration and Customs Enforcement. Id. at 677:22-24. She has held that position since March 2003. Id. at 678:1. Prior to that, she was a paralegal specialist for USCS for two years. Id. at 678:2-8. In both positions, which are essentially the same jobs (the difference being the reorganization of the USCS within the Department of Homeland Security (DHS) in 2003), Ms. Calip processes Freedom of Information Act requests. Id. at 678:9-22. Dr. Miguel Lizarraga is a fact and expert witness for plaintiff. Pl.'s Wit. 14. He works as a medical doctor. Tr. 798:1. He received a degree in a medicine from the University Juarez Autonoma de Tabasco in Mexico. Id. at 798:6-10. Dr. Lizarraga has a certificate in obesity, which was awarded to him by the Association of Obesity in Tijuana, Baja California after attending classes there. Id. at 799:6-17. For the past twenty-four years, he has practiced emergency medicine at the Issste Hospital in Tijuana, Mexico. Id. at 800:2-5. The court qualified Dr. Lizarraga as an expert in general medicine and in the control of obesity. Id. at 800:16-19. Mr. Carlos Mejia Lopez is a fact witness for plaintiff. Pl.'s Wit. 3-4. He is a criminal law attorney in Tijuana, Mexico. Tr. 129:20; 130:2-4. He was president of the municipality of Tijuana from 2004 to 2007. Id. at 130:25-131:1. He represented Mr. Agredano in the criminal proceedings that followed Mr. Rivera Agredano's arrest by the Mexican border authorities. Id. 140:12-14. Mr. Rivera Agredano's wife is a sister to Mr. Lopez's wife. Id. 140:11. (continued...) 5

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(...continued) Mr. Joseph Marilao is a fact witness for plaintiff. Pl.'s Wit. 6. He is a Supervisory Customs and Border Protection Officer, a position that he has held since 2006. Tr. 398:16-21. He began his employment with USCS in 1992 as an inspector at San Ysidro. Id. at 398:22399:4. After six months, he worked as an inspector at Otay Mesa and then returned to San Ysidro two and a half years later. Id. at 399:5-16. In 1997, he became a Canine Enforcement Officer and, in 2000, he became a Senior Inspector. Id. at 399:20-400:2. In 2002, Mr. Marilao served as a Canine Enforcement Officer again, and he became a Supervisor in the Canine Border Protection unit in 2006. Id. at 400:3-12. Mr. David John Murphy, Jr. is a fact witness for plaintiff. Pl.'s Wit. 7-8. He currently works as the Director of Field Operations for Customs in the Chicago field office. Tr. 304:24305:1. From 1983 to 1986, he orked for USCS as a customs inspector in San Ysidro, California. Id. at 305:4-14. Heb then worked as a Canine Enforcement Officer in the San Diego field office until 1999 when he ecame Acting Chief of the canine section. Id. at 305:21-306:10. After approximately three montshs, Mr. Murphy was selected as the Enforcement Coordinator for the Southern California Custom[s] Management Center, a position that he held until November 2001. Id. at 306:15-25. Ms. Aide Nunez is a fact witness for plaintiff. Pl.'s Wit. 12. She is an Inspector with Customs, Tr. 369:6-8, a position she has held since 1995, id. at 369:9-10. In 2001, she served as the Lead Officer in the Contraband Enforcement Team. Id. at 370:19-22. Mr. Jose Perez is a rebuttal witness for defendant. Tr. 724:23-725:3. Mr. Perez is a Supervisor Chief with Customs, a position that he has held since 2000. Id. at 725:17; 726:2-3. He has been with USCS and Customs for over nineteen years. Id. at 725:24-25. Mr. Robert Root is a fact witness for plaintiff, Pl.'s Wit. 11, and a fact witness for defendant, Def.'s Wit. 3. Although currently retired, Tr. 642:17, Mr. Root previously was employed by USCS, id. at 642:18-20. Beginning in October 1983, he served as an Inspector for USCS for three years. Id. at 642:21-643:6. In 1986, he became a Canine Enforcement Officer, a position that he held until 1995 when he became a Canine Enforcement Supervisor. Id. at 643:917. Mr. Root served as a Canine Enforcement Supervisor until his retirement in 2007. Id. at 643:19-20. Dr. Hector Santillana is a fact and expert witness for plaintiff. Pl.'s Wit. 13. He has worked as a psychiatrist for forty years. Tr. 772:21-23. He currently practices in Tijuana, Mexico. Id. at 773:9-12. He earned a degree in psychiatry in 1969. Id. at 773:6-8. From 1965 through 1968, he trained at Hospital Cruz del Norte in Hermosillo Sonora, Mexico, Hospital Cruz del Sur in Oaxaca, Mexico, and Hospital Fray Bernardino Alvarez in Mexico City, Mexico. Id. at 774:13-19. Since that time, he has kept his own office for private practice, and, in 1970 (continued...) 6

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Transcript (Tr.) passim. Following trial, the parties filed post-trial briefs and replies: Plaintiff Francisco Javier Rivera Agredano's Post Trial Brief (Pl.'s Br.); Defendant's Posttrial Brief (Def.'s Br.); Plaintiff Francisco Javier Rivera Agredano's Post Trial Reply Brief (Pl.'s Reply); and Defendant's Response to Plaintiff's Post-Trial Brief (Def.'s Reply). In a previous opinion in this case, the court dismissed a related claim brought by plaintiff's brother-in-law, Agredano v. United States (Agredano I), 70 Fed. Cl. 564, 579 (2006), and denied a motion by defendant to dismiss the case in its entirety, id. at 580. The procedural background is described in more detail in Part II.C below. Plaintiff seeks to recover damages arising from an alleged breach of contract by the government, specifically, U.S. Customs and Border Protection (Customs), in connection with the government's sale of a 1987 Nissan Pathfinder (the Pathfinder) after Mexican authorities stopped plaintiff in the Pathfinder and arrested him for transporting seventeen kilograms of marijuana found in the Pathfinder. Complaint (Compl.) ¶¶ 7, 1316. Specifically, plaintiff seeks to recover $2,600 for the fair market value of the Pathfinder; $350,000 for attorneys fees incurred by plaintiff during his criminal proceedings in Mexico; $1,254 for the costs and expenses incurred by plaintiff's family in bringing supplies to plaintiff while he was imprisoned; $48,000 for the income plaintiff lost during his imprisonment; $10,000 for the medical bills plaintiff incurred from the injuries and illnesses he sustained as a result of his imprisonment; $80,000 for the medical expenses it is reasonably foreseeable that plaintiff will incur in the future as a result of the injuries and illnesses he sustained as a result of his imprisonment; $12,500 for the psychiatric bills plaintiff has incurred as a result of the psychiatric ailments that his imprisonment caused; $33,000 to $60,000 for psychiatric expenses it is reasonably foreseeable that plaintiff will incur as a result of his imprisonment; and "[e]motional distress damages in an amount which the Court deems reasonable compensation for the arrest and imprisonment of . . . [plaintiff] for a period of 351 days . . . and the residual related problems suffered thereafter." Pl.'s Br. 1-2. II. Background

(...continued) and 1976, he also had two psychiatric clinics in Tijuana, Mexico. Id. at 774:25-775:12. From 1981 to 1984, Dr. Santillana also served as the director of the Issste Hospital. Id. at 775:21-25. In 1996, he was the director of another hospital, Health Department Health Center No. 1. Id. at 775:21-776:1. From 1974 through 1978, Dr. Santillana also served as the president and vice president at the medical university in Tijuana. Id. at 776:19-777:4. The court recognized Dr. Santillana as an expert in psychiatry. Id. at 778:1-2. 7

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A.

Plaintiff's Purchase of the Pathfinder and Subsequent Arrest by Mexican Authorities

Plaintiff Agredano currently resides in Tijuana, Mexico with his wife, Maria del Carmen Calderon, and two daughters. Tr. 44:18; 44:22-45:8; 49:13-15. He is in the printing business. Id. at 44:20-21. Alfonso Calderon and Gabriel Calderon, both of whom are brothers to plaintiff's wife, have worked as partners in plaintiff's printing business for the last twelve years. Id. at 45:16-46:13. Plaintiff's business prints items such as brochures, cards, stationary, and envelopes. Id. at 47:22-48:1. Some of plaintiff's clients are ad agencies that conduct work for Burger King in Tijuana and Cali-Max, a supermarket chain. Id. at 48:4-7. Plaintiff has printing equipment in Tijuana that he uses for smaller jobs, but he sometimes rents equipment at other locations in order to perform larger-scale projects. Id. at 47:9-13. Depending on the particular job, plaintiff may rent equipment in either Tijuana or Enseneda, Baja California. Id. at 48:10-16; see Joint Exhibit (JX) 12 (photographs from the evidence offering session) 18. On September 5, 2001, plaintiff bought the Pathfinder at an auction held by U.S. Customs near San Diego, California. Tr. 50:7-15; 51:6-7; see JX 4 (Conveyance Custody Acceptance Report) 13; JX 7 (plaintiff's title to the Pathfinder) 1. He attended the auction with his brother-in-law and business partner, Gabriel Calderon, because they each wanted to buy a vehicle. Tr. 54:22-55:5. At the auction, three to four hundred cars were being auctioned, id. at 55:5-6, but plaintiff and Gabriel Calderon decided to buy only one vehicle because "[s]ome of the ones that we were interested in were too expensive, so we weren't able to buy them," id. at 55:6-8. Plaintiff had learned about the auction from an acquaintenance, and he was interested in purchasing a vehicle at the auction because "this vehicle [Pathfinder], for example, in Tijuana would cost about $5,000, but at the auction, this vehicle cost - it cost me $2,600." Id. at 51:17-25. Plaintiff understood that the vehicles sold at these auctions were seized vehicles, but he had no knowledge as to where or why the cars had been seized. Id. at 52:2-12. Prior to this particular auction, plaintiff had bought vehicles at U.S. government auctions in the past "several times," and he had never had a problem with any of the vehicles that he had purchased previously. Id. at 51:12-16. When plaintiff arrived at the auction lot, he completed a Bidder Registration Form that was administered by U.S. Customs Service Support. Id. at 52:22-53:3; JX 6 (Bidder Registration Form) 1. As a condition of participating in the auction, plaintiff signed the Bidder Registration Form, Tr. 53:1-3, which provided, "I agree to comply with the terms of sale contained in the sale catalog for this sale and all future sales I attend," JX 6 (Bidder Registration Form) 1. Plaintiff chose to bid on the Pathfinder because of the vehicle's condition: "[I]t wasn't destroyed on the outside and the interior was intact." Id. 8

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at 53:12-13. Plaintiff was unable to open the doors and inspect the interior of the Pathfinder directly, but "[t]he back part was open and inside of that was a gas tank that had been removed and that's how you could look inside, and you could also look inside through the windows." Id. at 53:11-54:7. Gabriel Calderon confirmed at trial that the interior "looked in perfect condition," id. at 524:16, and that the only visible damage to the car was "that the gasoline tank had been removed and it was in the back of the car, in the trunk," id. at 524:10-12. Plaintiff further testified that "the upholstery was complete" in the Pathfinder, as opposed to "[o]ther vehicles [that] had the upholstery torn." Id. at 54:10-12. The fact that the upholstery was complete was important to plaintiff because "with some cars, it would be too expensive to have them be operational again[, a]nd that would raise the cost." Id. at 54:16-18. At some point prior to purchasing the Pathfinder, plaintiff saw a flyer, id. at 56:710, that stated the following: WARRANTY/GUARANTEE: All merchandise is sold on an "AS IS, WHERE IS" basis, without warranty or guarantee as to condition, fitness to use, or merchantability stated, implied or otherwise. Please bid from your personal observations. JX 5 (auction flyer) 1. Plaintiff testified that he understood that he was purchasing the vehicle "as is." Tr. 56:11-13. He stated that U.S. Customs "on one occasion said that the vehicles were auctioned as they were, `as is.' And they made reference to the fact that they didn't assume any responsibility if the engine was shot or the transmission didn't work." Id. at 56:16-20. Plaintiff also testified that he was not concerned about the Pathfinder containing narcotics "[b]ecause I was buying it from a country that has - that I supposed had high technology, the latest technology, and that it was impossible for it to have any problem." Id. at 58:9-12. Plaintiff "felt 100 percent sure, safe" that the Pathfinder had been checked for contraband because he "was buying it from the [U.S.] [g]overnment itself." Id. at 58:20-59:1. Plaintiff paid for the Pathfinder with cash, id. at 88:9-11, and signed the title to the vehicle, thereby obtaining ownership, JX 7 (Certificate to Obtain Title to a Vehicle) 1. The title stated the following: The undersigned Department or Agency of the United States Government certifies that the vehicle described herein, the property of the United States Government, has been transferred this 5th day of September 2001, to the Transferee designated herein; and that this is the first transfer of such

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vehicle in ordinary trade and commerce subsequent to acquisition thereof by the United States Government. Id. The title listed the transferor of the vehicle as "U.S. Customs Service" in San Diego and the transferee as "Francisco J. Rivera Agredano." Id. The signer on behalf of the transferor was Guiseppe A. Vaccano, and plaintiff signed as the transferee. Id. Having obtained possession of the Pathfinder, plaintiff "had to install the gas tank, which was right there in the vehicle itself." Tr. 59:3-4. To plaintiff's knowledge, after purchasing the Pathfinder, no one ever removed the rear seats, took out the paneling on the inside of the interior, or inspected the wheel walls above the tires. Id. at 59:14-25. Plaintiff and Gabriel Calderon drove the Pathfinder without any problems. Id. at 59:7-13. Some four and one-half months later, on January 24, 2002, at about eleven o'clock at night, plaintiff drove with Alfonso Calderon in the Pathfinder from Enseneda to Tijuana. Id. at 60:21-61:9. They had traveled to Ensenada earlier that day to drop off ten thousand blank sheets of paper to be processed at printing facilities there. Id. at 60:7-12. For their trip home, they packed into the Pathfinder five thousand printed, cardboard-like posters for one of their clients, the supermarket chain Cali-Max. Id. at 61:3-6; 62:10-12. In order to drive to Tijuana from Ensenada, plaintiff was required to stop at a mandatory checkpoint in the small town of Sauzal. Id. at 61:10-15. "[S]oldiers were inspecting all of the vehicles that came through there," and plaintiff and Alfonso Calderon "were asked where we were heading and what we were carrying." Id. at 62:810. Plaintiff was asked to pull to the side of the road, to get out of the Pathfinder, and to open the trunk. Id. at 62:20-24. The soldiers had a metal antenna "like [a] rod," id. at 63:14, "and they removed some coverings that the back upholstery has and they would stick in that metal antenna," id. at 63:9-11. Plaintiff saw the soldiers stick the metal antenna inside several places in the Pathfinder. Id. at 63:15-17. "When they were poking the side, the soldiers noticed that it would stop on something[,] and they started using force to knock off one of the coverings." Id. at 63:20-22. The soldiers found a package on the right side of the back part of upholstery. Id. at 63:23-64:5. They then asked Alfonso Calderon to get out of the Pathfinder, and "[t]hey started knocking down all of the - the signs, the cardboard signs, and they started breaking up all of the inside." Id. at 64:8-23. The soldiers found additional packages in the upholstery, in the doors, and in the sides of the vehicle. Id. at 64:24-65:3; see JX 12 (photographs from the evidence offering session) 12. During the inspection at Sauzal, plaintiff and Alfonso Calderon were restrained by the soldiers, who pointed guns to their heads, touched them with the butt of the guns, and 10

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handcuffed them. Tr. 65:23-66:8. Plaintiff injured his right arm "from the excessive movement upwards that they [the soldiers] made when they handcuffed me," and he was hit in the back a few times with the butt of a rifle. Id. at 67:20-68:10. Once the search was complete, plaintiff and Alfonso Calderon were held in a room and unable to make any telephone calls until six or seven o'clock in the morning. Id. at 66:11-19. The next morning, they were taken to an army barracks in Ensenada where "in a hidden manner a soldier let me [plaintiff] call Tijuana." Id. at 66:21-24. Plaintiff called his wife, Carmen. Id. at 66:25-67:1. By nine o'clock on the morning of January 25, 2002, plaintiff was at the Office of the Federal Attorney General, where he was held in a cell separate from Alfonso Calderon. Id. at 68:17-24. He stayed in that cell for about twelve hours and then went to the court in Ensenada to give a statement. Id. at 69:1; 69:7-11. Plaintiff and Alfonso Calderon were then taken to the penitentiary at Ensenada at about ten or eleven o'clock at night. Id. at 69:8-9. After arriving at the penitentiary, plaintiff was "totally, completely searched," and his wallet, belt, and shoelaces were taken. Id. at 70:2-4. The prison was constructed entirely of concrete and contained several areas with exposed sewage. Id. at 82:11; 83:19-21. Plaintiff was placed in a cell that contained approximately eleven other persons, id. at 70:9-10, and he remained there for twenty or thirty days, id. at 70:15. He testified that he did not fit in the cell and that he "was left to sit there at the door." Id. at 70:12-13. Because of the small size of the cell, plaintiff was unable to lie down to sleep. Id. at 70:20-23. The only bathroom facility available to plaintiff was a hole in the cell. Id. at 71:1-2. With regard to food and drink, plaintiff was given coffee and water three times a day and fed beans, rice, and soup. Id. at 71:15-24. Plaintiff's family would come and visit but it was difficult to do so "[b]ecause they had to be amongst the other inmates that were there. There [was]n't a special place where you can meet with them." Id. at 74:4-6. Eventually, plaintiff was transferred to another cell that contained forty-five or fifty persons. Id. at 72:17-19. He slept on the floor in that cell, id. at 75:9-11, and spent his days just sitting in the cell without an opportunity to exercise, id. at 74:18-75:14. He was provided with the same food and drink that he had received in the first cell. Id. at 81:19-23. There was only one toilet, which did not flush, located in the cell, and hot water was available for showering only at three or five o'clock in the morning. Id. at 83:1-15. Plaintiff remained in that cell for eleven months. Id. at 75:19-21. B. Plaintiff's Criminal Proceedings in Mexico

Attorney Carlos Mejia-Lopez, a criminal attorney in Tijuana, Tr. 129:20-130:4, who is married to one of the sisters of plaintiff's wife, id. at140:11, represented plaintiff 11

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throughout plaintiff's Mexican criminal proceedings, id. at 140:12-166:24. Mr. Mejia testified that, under Mexican criminal law, once someone is arrested, that person must appear before "the authorities that have jurisdiction over the person who's detained," id. at 131:18-19, within twenty-four hours and give a statement called "a ministerial statement," id. at 131:24-132:8. "It is at that time that the suspect is informed of the charges that he's being charged with." Id. at 132:2-3. "The Ministerial Government Office or District Attorney's Office then decides whether there are enough elements based on that statement . . . for that detainee to give a second statement before a judge." Id. at 132:11-15. The judge has forty-eight hours in which to accept the detainee's statement, which is known as "the pre-trial statement." Id. at 132:18-20. If the judge decides to pursue the charge, the defendant has three to six days to provide proof of his innocence. Id. at 133:2-22. Following the search of the Pathfinder by Mexican authorities at Sauzal, plaintiff was charged with drug trafficking and possession of drugs. Id. at 141:10. The first judge was a judge based in Ensenada. Id. at 138:20-24. Mr. Mejia requested from that judge the extended time period within which to produce evidence, and he was granted the sixday period. Id. at 136:8-14. The protocol is that evidence is presented to the court in writing, id. at 133:23-24, and that "[o]ne has to present each means of proof or evidence one by one and has to disclose the purpose of each evidence," id. at 133:24-134:1. "Evidence can be testimony from witnesses, police inspections, expert evidence, documents, [and/or] interviews . . . ." Id. at 134:2-5. The evidence is then presented to a clerk. Id. at 134:22-135:1. "The judge almost never sees the defendant." Id. at 135:25. Mr. Mejia testified that, following the initial presentation of evidence, if the defendant is indicted, the "instruction period," Tr. 136:22-25, begins, during which "the judge says you have an X amount of months for you to offer more evidence because this evidence is not sufficient," id. at 137:1-3. The evidence includes "statements, documents, eyewitness visits, confrontations, [and/or] reconstructing the scene of the events." Id. at 137:6-8. At the end of the instruction period, a hearing occurs at which the judge affords the attorney a final opportunity to make a record. Id. at 137:21-138:1. A few days after the hearing, the judge issues a decision. Id. at 138:1-2. If the judge finds the defendant guilty, the defendant may appeal the sentence before a "higher" judge. Id. at 138:11-15. Before the "higher" judge, "you present your written arguments and documents that you may have, but you are not allowed any more to offer any kind of statements or testimony or any visits where you personally go and inspect the scene." Id. at 138:15-19. If that second judge affirms the guilty verdict, the defendant may appeal once more before a panel of three "higher" judges. Id. at 139:10-12.

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Plaintiff's initial line of defense was "to try to prove to the judge that they [plaintiff and Alfonso Calderon] were in Ensenada doing a printing job." Id. at 141:1314. Plaintiff did not, when he was arrested, know how the marijuana came to be in the Pathfinder, id. at 141:22-142:1, and "[i]t wasn't until weeks later that we [plaintiff's defense attorneys] realized that the problem had been that that car had been previously detained with drugs in it." Id. at 142:1-3. On March 11, 2002, Mr. Mejia "had a visual inspection evidence offering session in Ensenada" where he "asked the judge to open those packages [the packages seized by the Mexican soldiers at the checkpoint]." Id. at 142:3-6. Mr. Mejia testified, "We opened some packages and the drugs had rotted. It was full of like fungi. It was rotten. It was no good." Id. at 142:6-8; see also JX 12 (photographs from the evidence offering session) 1-8. On that same date, plaintiff's wife presented Mr. Mejia with a document "that had the name Jose Jimenez-Coronel" and "explained there in English that the car had been seized at the San Ysidro Customs area on . . . January 25, 2001." Id. at 142:14-20; see JX 2 (Custody Receipt) 1. Mr. Mejia then contacted the U.S. Customs and Border Patrol in Otay Mesa for more information about the circumstances leading to the Customs sale of the Pathfinder at the auction, Tr. 143:7-10; 144:8-10, but the Customs officials "[spoke] harshly to me and they'd close the window," id. at 144:1-2. Mr. Mejia then hired a law firm in San Diego to help him obtain the information that he sought from Customs. Id. at 144:24-145:4. With the help of the law firm in San Diego, which is the law firm to which plaintiff's counsel belongs, Mr. Mejia "obtained some important documents" from Customs. Tr. 145:7. Specifically, plaintiff's counsel sent a Freedom of Information Act (FOIA)/Privacy Act (PA) request to Customs, asking for "photographs of the Pathfinder and the marijuana found in the Pathfinder, and other photographs connected to this seizure file." JX 14 (Customs' response to plaintiff's counsel's FOIA request) 1. After receiving an incomplete response and sending a second FOIA request, see Part III.G.2, Mr. Mejia finally obtained the eight photographs that Customs had taken after having seized the Pathfinder, JX 15 (Customs' response to plaintiff's counsel's FOIA request) 1, 7-24. Mr. Mejia presented all eight photographs to the first judge before she submitted her ruling on the case. Tr. 148:2-5. Mr. Mejia also offered evidence regarding the condition of the Pathfinder after the Mexican security forces discovered the marijuana. Id. at 150:12-154:11; JX 12 (photographs from the evidence offering session) 9-17. Mr. Mejia testified at trial that: [W]e went to do a car inspection because I wanted to see how it was that they had gotten the packages out of the car. Because the soldiers had said that the packages were hidden in the car, in the walls. And we went - when we went there to carry out this inspection, we realized that the soldiers had 13

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destroyed the whole interior of the car. They destroyed it all. They pulled off all of the upholstery. From the moment that they found the first package, they tore the car up inside entirely, took down all the walls. They didn't hesitate a bit. They found one [package] and they tore everything up, all of it totally. The car was destroyed. Tr. 150:15-151:2; see JX 12 (photographs of the evidence offering session) 9-17. The posters that plaintiff and Alfonso Calderon had been transporting from California to Tijuana remained in the back of the car. Tr. 152:2-11; JX 12 (photographs from the evidence offering session) 21. Mr. Mejia took pictures of the posters and presented those pictures as additional evidence "because the judge did not believe that the posters had been in the car." Tr. 152:5-7; see JX 12 (photographs from the evidence offering session) 12-22. Mr. Mejia presented additional photographs of the packages of marijuana. See JX 12 (photographs of the evidence offering session) 27-29. Mr. Mejia testified that the Mexican Federal Attorney General's Office "explained to me that some of the packages were wrapped in plastic - vacuum-packed so that the smell would not go through the packaging and that, because of this, most likely the packages could have been in the car for so long, about a year, and practically not have smelled." Tr. 159:22-160:2. One chemist had inspected the packages on the date that plaintiff and Alfonso Calderon were detained, and Mr. Mejia stated that: [H]e [the first chemist] testified before the judge because I asked that he be subpoenaed to give his statement. When I asked him certain things about the drugs, the characteristics of the drugs that he had checked on the date that my guys had been detained, he answered that the drugs that he had inspected in those packages was very dry, that it smelled badly, that it was drugs that had been stored for a long time and that it lacked texture and he was the chemist for the prosecution . . . , yet he was testifying as to things that he had noted the first day when he checked the drugs when they were arrested. . . . And then, afterwards, I asked for an expert opinion with two other chemists so that they could analyze each package one by one and that's how the three chemists finally arrived at the same conclusion, in that it was old drugs, that it was - they were - it was dry, that it lacked texture, and that it had spoiled

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and that these drugs had been in the car for at least a year. And the defendants had been arrested only about a month and a half.4 Id. at 160:20-161:19 (footnote added); see also JX 18 (summary of the first chemist's testimony) 1-2. Mr. Mejia "offered 57 pieces of evidence, approximately." Tr. 162:24-25. The evidence included "visual inspections, expert chemists' testimony, many statements of witnesses, character witnesses to prove Mr. Rivera and Mr. Calderon's honorability, many reference letters, statements on the part of the soldiers, confrontations with the soldiers, and the soldiers themselves." Id. at 163:1-6. Mr. Mejia testifed that he asked the soldiers, "`When you asked the car to stop, what was the attitude on the part of these men, Rivera and Calderon?' They said that it was normal, that it didn't seem that they were worried or anything because they were convinced that what they were carrying in the car were posters, the posters that they had just printed up." Id. at 163:7-13. Proceedings took place before the judge in Ensenada up until June 25, 2002. Id. at 138:23-24. On that date, the judge found plaintiff guilty and sentenced plaintiff to five years in jail. Id. at 139:23. The opinion delivered by the judge 5 found plaintiff's defense

It appears that "a month and a half," Tr. 161:19, refers to the time elapsed between plaintiff's arrest and the chemist's examination of the drugs. The Pathfinder was seized on January 25, 2001, Compl. ¶ 9, and forfeited to defendant at some point between January 25, 2001 and September 5, 2001, id. at ¶¶ 9-13. Plaintiff purchased the Pathfinder on September 5, 2001. Tr. 50:7-10; 51:6-7. Plaintiff was arrested on January 24, 2002, id. at 60:21-66:13, approximately a year after the Pathfinder was seized. Plaintiff and defendant agreed to admit into evidence Interpreter Mayne's translation of certain sections of an opinion issued in Spanish by the Mexican criminal judge, Tr. 258:7-259:4, 514:3-13, at this juncture. Interpreter Mayne sight translated and read into the record portions of the opinion designated by plaintiff's attorney. Id. at 516:7-519:5. The court admitted the opinion into evidence under FRE 1005, Tr. 259:13-260:1, which states that "[t]he contents of an official record, or of a document authorized to be recorded or filed and actually recorded or filed . . . , may be proved by copy, certified as correct in accordance with [FRE] 902 or testified to be correct by a witness who has compared it with the original," FRE 1005. The opinion is selfauthenticating under FRE 902(3), which provides that a foreign public document is selfauthenticating and the court may treat it "as presumptively authentic without final certification or permit [it] to be evidenced by an attested summary with or without final certification." FRE 902(3). The opinion issued by the Mexican criminal court is a foreign public document; accordingly, no further proof of authenticity other than the document itself was required. 15
5

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- that the United States had failed adequately to inspect the Pathfinder before selling it to plaintiff - incredible: Thus, what the Defense has stated, that precisely the authorities of the United States have not conducted an adequate inspection of the other compartments of the vehicle because the interior of the same was found intact is not credible. Said information, which was provided by the Customs Department, and which was offered as evidence in this criminal case, does not benefit them in any way since[,] independently of what the Defense states, that the U.S. authorities did not conduct an exhaustive inspection, it must be noted that they have adequate technology and don't have the need to destroy the vehicle. So, in regard to the documentary evidence presented or submitted, specifically the photographs showing the interior of the vehicle intact, that indicates that it did not have drugs in any other part of the vehicle and that they did not know of their existence. Id. at 516:14-517:10. The judge opined that the United States officers would not have violated United States law by failing to inspect the Pathfinder: This Judge could not establish that an omission has been made on behalf of the Customs authorities in the United States in that they did not inspect adequately the other compartments of the vehicle since, as has been informed, such determination would constitute a violation of the laws of that country. Id. at 517:13-20. The judge appears to assume that - based on photographic evidence the proper inspections must have been made without destroying the interior. She further appears to assume that the "technology" available to the United States would have permitted a complete search without damaging the interior of the Pathfinder: In order to make a determination of something that is a matter for them to resolve, even though in the photographs it can be noted that the vehicles interior was intact and thus can be clearly seen, that the same at the moment it was seized by the Government of the United States did not have drugs in any other part and that, on the contrary, that the gasoline tank that had been removed had been the place where they had found drugs at the moment they seized - the United States authorities seized the vehicle and that the inspection was conducted according to their methods, procedures, and technology that they have, without having to destroy a vehicle in order to inspect it. 16

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Id. at 517:20-518:11. The judge had previously refused to credit plaintiff's testimony that he had crossed the United States/Mexican border without incident: On the other hand, it is also incredible that the Defendant, Francisco Javier Rivera-Agredano, and witnesses Gabriel Calderon-Leon, as well as the minor, Paulina Lizeth Rivera-Calderon, what they stated, that during the Christmas season they crossed the vehicle in question into the United States in more than one occasion. Since that version is unbelievable since at that time of the year, the inspections are even more exhaustive. In addition, in December of 2001, they were particularly exhaustive since they were at a very recent time after the events of the terrorist attacks to the Twin Towers in New York. Being able to consider that if the drug that was seized had been found in the vehicle, it could have been easily detected. Id. at 518:13-519:5. From June 25, 2002 through September 17, 2002, plaintiff appealed before a magistrate judge in Tijuana. Id. at 138:25-139:5. Mr. Mejia "explained many of the arguments to the magistrate," id. At 164:14-15, who told Mr. Mejia that his "defense was very good," id. at 164:19, because he "offered many pieces of evidence," id. at 164:20-21. However, on September 17, 2002, the magistrate judge affirmed the first judge's sentence in a written ruling. Id. at 165:2-5. The judge ruled that the first judge "had been able to correctly evaluate the evidence, that the judge had done an excellent job." Id. at 165:1012. From September 17, 2002 through January 10, 2003, Mr. Mejia worked on the final appeal for plaintiff, which was held before three judges in Mexicali. Id. at 139:10-17. On January 10, 2003, Mr. Mejia "received a call from Mexicali letting me know that they [plaintiff and Alfonso Calderon] would be released that day." Id. at 166:22-24. C. Procedural Background

On November 14, 2002, plaintiff and his brother-in-law, Alfonso Calderon Leon, jointly filed a claim in the United States District Court for the Southern District of California pursuant to the Federal Tort Claims Act, 28 U.S.C. §§ 1346(b) and 2671-80, alleging negligence, breach of contract, breach of the implied covenant of good faith and fair dealing, fraud or intentional misrepresentation, negligent misrepresentation, negligent and intentional infliction of emotional distress, and violation of California's Consumer Legal Remedies Act, § 1770(a)(14). Defendant's Motion to Dismiss Or, in the Alternative, for Summary Judgment (Def.'s Mot. or defendant's motion) App. 20-47. On June 29, 2004, the United States Supreme Court issued its decision in Sosa v. AlvarezMachain, 542 U.S. 692 (2004), finding that a cause of action could not lie under the 17

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Federal Tort Claims Act for "any injury suffered in a foreign country, regardless of where the tortious act or omission occurred." Sosa v. Alvarez-Machain, 542 U.S. 692, 712 (2004). On or about November 3, 2004, Compl. ¶ 3, the United States District Court for the Southern District of California granted defendant's motion for summary judgment, finding that the action was barred under the Federal Tort Claims Act because plaintiffs' arrest occurred in Mexico, see Agredano v. United States, No. 02CV2243B, Docket Entry No. 71 (S.D. Cal. Nov. 3, 2004). Thereafter, plaintiff, Alfonso Calderon, and defendant stipulated to the filing of an amended complaint and to the transfer of the action to this court. Compl. ¶ 3. On February 3, 2005, pursuant to the parties' stipulation, the United States Court for the Southern District of California dismissed plaintiff's and Calderon's claims without prejudice, granted the parties' motion to amend, and transferred the action to this court. Stipulation to Transfer and Dismiss Appeal, Agredano v. United States, No. 05-608, Docket Entry No. 1, Attach. 1 (Fed Cl. June 8, 2005). On June 17, 2005, plaintiff and Alfonso Calderon filed their amended complaint in this court, alleging breach of warranty, breach of contract, and breach of the covenant of good faith and fair dealing. Compl. passim. On September 30, 2005, defendant filed defendant's motion, alleging that this court lacked jurisdiction because plaintiff's and Alfonso Calderon's claims sound in tort or, alternatively, that the material facts are not in dispute and that the facts as alleged entitle defendant to judgment as a matter of law. Def.'s Mot. 1-22. In support of its motion for summary judgment, defendant argued (1) that the "as is" clause in the terms of sale precludes the existence of an implied warranty, id. at 12-16; (2) that defendant did not breach the implied covenant of good faith and fair dealing because it did not "specific[ally] inten[d] to injure" plaintiffs or harbor "actual malice" toward them, id. at 16-18 (citing Am-Pro Protective Agency, Inc. v. United States, 281 F.3d 1234, 1239 (Fed. Cir. 2002), and Carolina Tobacco Co. v. Bureau of Customs & Border Prot., 402 F.3d 1345, 1350 (Fed. Cir. 2005)); (3) that the damages plaintiff and Alfonso Calderon alleged were unrecoverable because defendant's breach did not directly cause plaintiffs' harm, id. at 18-20; and (4) that Alfonso Calderon was not a third-party beneficiary of the contract of sale and therefore cannot recover under the contract, id. at 21. On November 14, 2005, plaintiff and Alfonso Calderon filed their Opposition to Defendant USA's Motion to Dismiss or, in the Alternative, for Summary Judgment, with Appendix (Pls.' Resp. or plaintiffs' response), arguing (1) that this court had jurisdiction because defendant's failure to search the vehicle constituted a breach of contract, Pls.' Resp. 15; (2) that the "as is" clause did not preclude the existence of a warranty because its scope was not broad enough to cover the defect plaintiffs allege, id. at 20; (3) that there was a triable issue of material fact as to whether defendant's alleged failure to search the vehicle prior to sale for the purpose of increasing the resale value of 18

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the vehicle and defendant's concomitant failure to disclose its actions constitute a breach of the covenant of good faith and fair dealing, id. at 17, 19-21; (4) that the damages sustained were recoverable because they were foreseeable and in fact occurred, id. at 2, 17-18; and (5) that Alfonso Calderon was a third-party beneficiary and accordingly entitled to recover under the contract, id. at 17. Plaintiff and Calderon further moved the court for "leave to amend the[ir] complaint to allege additional facts to establish the causes of action set forth in the complaint," "if necessary." Id. at 1. In its Opinion filed March 27, 2006, this court held: (1) that plaintiff and Alfonso Calderon sufficiently established that there were genuine issues of material fact as to whether the context of the sale and the policy to search seized vehicles prior to resale constituted an affirmative representation which would negate the disclaimer and create a warranty; (2) that plaintiff may pursue his allegation that defendant breached the covenant of good faith and fair dealing by proving either that the government failed to conduct an adequate search for the purpose of obtaining a higher resale value for the vehicle at auction or that plaintiffs could not have discovered the hidden contraband in the circumstances of the auction sale and that the government had a policy to search thoroughly any vehicle seized because it contained narcotics, but that the government acted in direct contravention of its stated policy; (3) that plaintiff established the existence of a genuine issue of material fact as to whether damages he sustained in Mexico are recoverable in contract against defendant; (4) that Alfonso Calderon was not a third-party beneficiary of the contract between Agredano, the buyer of the Pathfinder, and defendant, the seller of the Pathfinder; and (5) that plaintiff may not be given leave to amend his complaint. Agredano I, 70 Fed. Cl. at 573-580. Following telephonic status conferences held with the parties on July 6, 2006 and July 10, 2006, the court assigned-in-part the case to alternative dispute resolution (ADR) proceedings and retained jurisdiction over discovery and other proceedings in the case. See Order of July 10, 2006. On September 1, 2006, the parties requested the ADR judge to suspend proceedings while the parties pursued formal discovery. Defendant's Status Report, Sept. 1, 2006, 1. The ADR judge granted the parties' request to suspend ADR proceedings, Order of Oct. 10, 2006, and this court issued a scheduling order for dispositive briefing, Order of Oct. 30, 2006. In the months that followed, the parties proceeded with the discovery process and again attempted to settle the dispute. See Order of Feb. 9, 2007; Order of Feb. 14, 2007; Order of June 1, 2007. Pursuant to the parties' request, the ADR judge terminated ADR proceedings on July 20, 2007. Order of July 20, 2007. On September 14, 2007, this court set out a pretrial scheduling order in preparation for trial. Order of Sept. 14, 2007. Pursuant to that pretrial scheduling order, the parties filed: Plaintiff Francisco Javier Rivera Agredano's Memorandum of Contentions of Fact and Law (Pl.'s Mem.); Defendant's Memorandum of Contentions of Fact and Law 19

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(Def.'s Mem.); Defendant's Witness List (Def.'s Wit.); Defendant's Exhibit List (Def.'s Ex.); Plaintiff Francisco Javier Rivera Agredano's Response and Objections to Defendant's Memorandum of Contentions of Fact and Law; Witness and Exhibit List (Pl.'s Obj.); Plaintiff Francisco Javier Rivera Agredano's Witness List (Pl.'s Wit.); Plaintiff's Exhibit List (Pl.'s Ex.); and defendant's Motion for Leave to File Defendant's Objections to Plaintiff's Revised Witness and Exhibit Lists (Def.'s Obj.). Following a pretrial conference held on January 14, 2008, see Order of Jan. 10, 2008; Order of Jan. 15, 2008, the court held trial on January 28, 2008 through January 31, 2008 in the Federal Building at 880 Front Street, San Diego, California. See Tr. passim. In its post-trial briefing, the government concedes that a contract existed between plaintiff and defendant when plaintiff purchased the Pathfinder. See Def.'s Br. 1-2, 5 (acknowledging that a contract existed between plaintiff and defendant). However, the government contends that the various contractual theories of breach posited by plaintiff do not apply. See Def.'s Br. passim; Def.'s Reply passim. Out of twenty-one witnesses in total, defendant presented only three witnesses on direct examination and three witnesses on rebuttal. Defendant did not address in its post-trial briefing plaintiff's damages presentation other than to argue generally that compensatory and emotional distress damages are not available at all to plaintiff. Def.'s Br. 22-29; Def.'s Reply 24-27. With several exceptions, the government has chosen to use the forum of a trial and posttrial briefing to present essentially legal arguments. The bulk of the testimony and evidence presented at trial, therefore, was presented by plaintiff in support of his case that a contract existed between plaintiff and defendant, that defendant breached that the terms of that contract when it sold the Pathfinder to plaintiff, and the nature and the amounts of the damages caused by that breach. See Tr. passim. III. Discussion A. 1. Legal Standards Jurisdiction

The United States Court of Federal Claims has jurisdiction "to render judgment upon any claim against the United States founded . . . upon any express or implied contract with the United States." 28 U.S.C. § 1491(a)(1) (2006). The court does not have jurisdiction to render judgment upon actions sounding in tort. Id. When a defendant challenges this court's jurisdiction pursuant to Rule 12(b)(1) of the Rules of the United States Court of Federal Claims (RCFC), the plaintiff bears the burden of proving that jurisdiction is proper. Toxgon Corp. v. BNFL, Inc., 312 F.3d 1379, 1383 (Fed. Cir.

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2002); Reynolds v. Army & Air Force Exch. Serv., 846 F.2d 746, 748 (Fed. Cir. 1988); Corrigan v. United States, 68 Fed. Cl. 589, 592 (2005). The jurisdiction of this court is not limited by the tortious nature of a claim otherwise cognizable in it. See, e.g., Chain Belt Co. v. United States, 115 F. Supp. 701, 711-12 (Ct. Cl. 1953) ("While it is true that this court does not have jurisdiction over claims sounding primarily in tort, an action may be maintained in this court which arises primarily from a contractual undertaking regardless of the fact that the loss resulted from the negligent manner in which defendant performed its contract."). In particular, a claim for tortious breach of contract is not precluded merely because the claim, though rooted in contract, also sounds in tort. Id.; Pratt v. United States, 50 Fed. Cl. 469, 480 (2001) (stating that a claim for tortious breach of contract has been recognized "not [to be] a tort independent of the contract so as to preclude Tucker Act jurisdiction"). Nor does the fact that consequential damages are alleged make the claim a tort claim; rather, an allegation of "consequential damages" presumes that the plaintiffs are proceeding under a contract theory. See, e.g., Bohac v. Dep't of Agric., 239 F.3d 1334, 1339-40 (Fed. Cir. 2001) (recognizing "consequential damages" as a "contract law concept"). As long as the claim "specifically relate[s] to a contractual obligation," it will survive a motion to dismiss. Pratt, 50 Fed. Cl. at 480. Despite defendant's assertion that the court did not have jurisdiction over this matter, see Def.'s Mot. 1-22 (alleging that this court lacks jurisdiction because plaintiffs' claims sound in tort or, alternatively, that the material facts are not in dispute and that the facts as alleged entitle defendant to judgment as a matter of law), the court ruled previously that the court does indeed have jurisdiction over the claims brought by plaintiff Agredano, Agredano I, 70 Fed. Cl. at 580, and the court is not persuaded by defendant's arguments to revisit its prior ruling. 2. Implied-in-Fact Warranty

The Court of Federal Claims has jurisdiction over implied-in-fact warranty contractual disputes only, not implied-in-law warranty contractual disputes. See Hercules Inc. v. United States (Hercules), 516 U.S. 417, 423 (1996). "The Tucker Act . . . does not confer jurisdiction of claims against the United States on contracts, implied at law, they must be implied at fact." Lopez v. A.C.&S., Inc. (Lopez), 858 F.2d 712, 714-15 (Fed. Cir. 1988). "Implied-in-fact contracts differ from contracts implied in law (quasicontracts), where a duty is imposed by operation of law without regard to the intent of the parties." Russell Corp. v. United States, 537 F.2d 474, 482 (Ct. Cl. 1976). The Federal Circuit has held that implied-in-fact contracts are distinguished by "circumstances [that] strongly support[] a factual inference that a warranty was implied." Lopez, 858 F.2d at 21

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715. "An agreement implied in fact is `founded upon a meeting of minds, which, although not embodied in an express contract, is inferred, as a fact, from conduct of the parties showing, in the light of the surrounding circumstances, their tacit understanding.'" Hercules, 516 U.S. at 424 (quoting Baltimore & Ohio R.R. v. United States (Baltimore & Ohio R.R.), 261 U.S. 592, 597 (1923)). The alleged implied-in-fact warranty in this case is a warranty that the Pathfinder was free of all contraband when defendant sold the Pathfinder to plaintiff. See Pl.'s Br. 12-13. In order to determine whether such a warranty existed and, if it did, whether defendant violated that warranty, the court first will examine defendant's policies regarding searches and seizures of seized vehicles. The court then will examine defendant's and plaintiff's understandings, to be proven by plaintiff, reasonably inferable as facts from the parties' conduct in light of the surrounding circumstances, regarding whether the Pathfinder was free of all contraband. The "meeting of the minds" in this case, therefore, is a mutual, if tacit, understanding, between plaintiff and defendant that the Pathfinder was free of all contraband when defendant sold the Pathfinder to plaintiff. 3. Superior Knowledge

The superior knowledge doctrine provides that, where the government has vital information about the transaction or object of the transaction, knows that its contracting partner has no knowledge of and no reason to obtain such information, misleads its contracting partner as to that information, or fails to put its contracting partner on notice to inquire, and does not provide the relevant information, the government has breached the contract. GAF Corp. v. United States, 932 F.2d 947, 949 (Fed. Cir. 1991). As this court ruled previously, "Where the government has a policy providing that it will search a vehicle prior to resale when there is probable cause to suspect that narcotics are hidden within the vehicle, . . . and where, as here, the vehicle was seized because of the presence of contraband, . . . the government may be found to have misled its contracting partner or, alternatively, failed to put its contracting partner on notice to inquire as to the presence of contraband in the vehicle." Agredano I, 70 Fed. Cl. at 575 (internal citations omitted). The government has a duty to disclose "superior knowledge . . . which is unknown and reasonably is not available to the contractor." John Massman Contracting Co. v. United States (Massman), 23 Cl. Ct. 24, 32 (1991) (citing Utility Contractors, Inc. v. United States, 8 Cl. Ct. 42, 52 (1985), aff'd, 790 F.2d 90 (Fed. Cir. 1986) (Table)). The government does not, however, have a duty to disclose information that is reasonably available, Massman, 23 Cl. Ct. at 32 (citing L.G. Everist, Inc. v. United States, 231 Ct. Cl. 1013, 1018 (1982)); see also Vann v. United States, 420 F.2d 968, 982 (Ct. Cl. 1970), or that the contractor has an opportunity to learn on its own, see Vann, 420 F.2d at 982 22

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(stating that a contractor who knows or has the opportunity to learn the facts cannot show that it was misled by the contract). Plaintiff alleges that defendant violated the doctrine of superior knowledge when it did not disclose to plaintiff the alleged existence of a rumored policy in Customs to minimize damage during searches of seized vehicles in order to preserve the resale value of the vehicles at auction. Pl.'s Br. 21. In order to determine whether such a policy existed and whether defendant violated the superior knowledge doctrine, the court will examine the relevant testimony provided by Customs employees at trial. 4. Implied Covenant of Good Faith and Fair Dealing

The covenant of good faith and fair dealing is implied in every contract. Centex Corp. v. United States, 395 F.3d 1283, 1304 (Fed. Cir. 2005). The covenant