Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-05126/USCOURTS-ca13-14-05126-0/pdf.json

Parties Involved:
Juan M. Sahagun-Pelayo
Appellant
United States
Appellee

Document Text:

NOTE: This disposition is nonprecedential.

United States Court of Appeals 

for the Federal Circuit ______________________ 

JUAN M. SAHAGUN-PELAYO, (ON BEHALF OF 

HIMSELF); JUAN M. SAHAGUN-PELAYO (ON 

BEHALF OF THE DECEASED AND THEIR 

ESTATE, MEXICO),

Plaintiff-Appellant

v.

UNITED STATES,

Defendant-Appellee

______________________ 

2014-5126

______________________ 

Appeal from the United States Court of Federal 

Claims in No. 1:13-cv-00929-LJB, Judge Lynn J. Bush.

______________________ 

Decided: March 9, 2015

______________________ 

JUAN M. SAHAGUN-PELAYO, Oakdale, LA, pro se. 

P. DAVIS OLIVER, Commercial Litigation Branch, Civil 

Division, United States Department of Justice, Washington, DC, for defendant-appellee. Also represented by 

JOYCE R. BRANDA, ROBERT E. KIRSCHMAN, JR., STEVEN J.

GILLINGHAM. 

______________________ 

Case: 14-5126 Document: 26-2 Page: 1 Filed: 03/09/2015
2 SAHAGUN-PELAYO v. US

Before PROST, Chief Judge, MAYER, and O’MALLEY,

Circuit Judges.

PER CURIAM. 

Appellant Juan M. Sahagun-Pelayo (“SahagunPelayo”) appeals pro se from a final decision of the United 

States Court of Federal Claims granting the government’s 

motion to dismiss pursuant to Rules 12(b)(1) and 12(b)(6) 

of the Rules of the United States Court of Federal Claims 

(“RCFC”). Sahagun-Pelayo v. United States, No. 13-929 

C, 2014 WL 3643471 (Fed. Cl. July 22, 2014). Specifically, the court found that: (1) it lacked jurisdiction over 

Sahagun-Pelayo’s tort claim; and (2) Sahagun-Pelayo 

failed to state a claim for breach of contract. On appeal, 

Sahagun-Pelayo challenges only the court’s decision to 

dismiss his contract claim under Rule 12(b)(6). For the 

reasons explained below, we affirm. 

I. BACKGROUND

The following facts are derived from Sahagun-Pelayo’s 

pleadings before the Court of Federal Claims. SahagunPelayo is Mexican citizen who is incarcerated in federal 

prison. In November 2013, Sahagun-Pelayo filed suit 

against the government “on behalf of himself, and on 

behalf of the to be named decedents and their estate in 

Mexico,” alleging that he provided confidential informant 

services to several federal agencies investigating drug and 

gun trafficking, including the Federal Bureau of Investigation (“FBI”), the Bureau of Alcohol, Firearms and 

Tobacco (“ATF”), the Drug Enforcement Agency (“DEA”), 

and the United States Immigration and Customs Enforcement (“ICE”). Compl., Sahagun-Pelayo v. United 

States, No. 13-929C (Fed. Cl. Nov. 22, 2013), ECF No. 1. 

Sahagun-Pelayo’s complaint presents two claims: (1) a 

tort claim, citing the Federal Tort Claims Act (“FTCA”); 

Case: 14-5126 Document: 26-2 Page: 2 Filed: 03/09/2015
SAHAGUN-PELAYO v. US 3

and (2) a breach of contract claim.1 Specifically, SahagunPelayo alleges that he had a verbal contract with the 

government in connection with an operation entitled 

“Fast and Furious.” Pursuant to this alleged agreement, 

Sahagun-Pelayo provided information to help secure the 

arrest of Mexican drug cartel members. Sahagun-Pelayo 

alleges that he provided confidential information to an 

ICE agent (Jesus Loscano), a DEA operative (Carmen), an 

FBI employee (Mike Kosinsky), and “Jhon an[d] other[s]” 

from ATF. Sahagun-Pelayo, 2014 WL 3643471, at *3. He 

contends that, in exchange for this information, the 

government agreed to pay him for his services and protect 

his family. According to Sahagun-Pelayo, he is owed 

$84,717,000. Id. at *1. 

The government filed a motion to dismiss, arguing 

that: (1) the Court of Federal Claims does not possess 

jurisdiction to consider his FTCA claim; and (2) SahagunPelayo failed to allege the requisite elements of a breach 

of contract claim. As to its second point, although Sahagun-Pelayo identified three government agents with 

whom he had contact generally, the government argued

that he failed to state a claim for breach of contract under 

Rule 12(b)(6) because he failed to allege that any of those

1 As the Court of Federal Claims noted, SahagunPelayo previously presented similar claims in the United 

States District Court for the District of Columbia. Pelayo 

v. United States, No. 11-1430, 2011 WL 3797742, at *1 

(D.D.C. Aug. 26, 2011). There, the court: (1) dismissed 

the tort claim for failure to exhaust administrative remedies; and (2) found that it was “without authority” to 

resolve the breach of contract claim, which sought compensatory damages of $1,500,000, because it exceeded the 

court’s jurisdictional limit for contract claims against the 

government. Pelayo v. United States, No. 11-1430, 2011 

WL 5244363, at *1 (D.D.C. Oct. 31, 2011). 

 

Case: 14-5126 Document: 26-2 Page: 3 Filed: 03/09/2015
4 SAHAGUN-PELAYO v. US

individuals possessed actual authority to bind the United 

States in contract. 

In response, Sahagun-Pelayo alleged, for the first 

time, that he “met with representatives of the United 

States Government from Washington, D.C. in El Paso, 

Texas, who he believed had the authority to make him the 

offers and security arrangements which are . . . the primary basis for this complaint in the Court.” Plaintiff’s 

Intermediate Response, Sahagun-Pelayo v. United States, 

No. 13-929C (Fed. Cl. Apr. 7, 2014), ECF No. 18 at 2. He 

also asserted that, “[w]hen the United States representative from Washington who was at the meeting told Plaintiff that he was the final word and authority in this 

matter, it was the Plaintiff’s understanding that he did 

not need or require an Act of Congress to make this 

contractual agreement binding on the United States.” Id. 

at 3. 

The Court of Federal Claims granted the government’s motion to dismiss in full. First, the court dismissed Sahagun-Pelayo’s FTCA claim on grounds that its 

jurisdiction does not extend to tort claims. SahagunPelayo does not challenge this conclusion on appeal. As to 

the contract claim, the court found that “the complaint, as 

supplemented by plaintiff’s response brief, does not provide sufficient facts to plausibly suggest that any government employee had implied or express authority to enter 

into a contract with Mr. Sahagun-Pelayo that would 

possibly entitle him to the relief he seeks in the complaint.” Sahagun-Pelayo, 2014 WL 3643471, at *5.2 

2 Although the government argued that the court 

should “consider only the complaint when analyzing 

plaintiff’s claims” in connection with the motion to dismiss, the Court of Federal Claims “also considered plaintiff’s response brief as an informal clarification of the 

 

Case: 14-5126 Document: 26-2 Page: 4 Filed: 03/09/2015
SAHAGUN-PELAYO v. US 5

Accordingly, the court dismissed Sahagun-Pelayo’s contract claim pursuant to RCFC 12(b)(6). 

Sahagun-Pelayo timely appealed to this court. We 

have jurisdiction under 28 U.S.C. § 1295(a)(3). 

II. DISCUSSION

Whether the Court of Federal Claims properly dismissed a complaint for failure to state a claim upon which 

relief may be granted is an issue of law subject to de novo 

review. Cambridge v. United States, 558 F.3d 1331, 1335 

(Fed. Cir. 2009). We must “accept as true the complaint’s 

undisputed factual allegations and should construe them 

in a light most favorable to the plaintiff.” Id. To avoid 

dismissal for failure to state a claim under Rule 12(b)(6), 

“a complaint must allege facts ‘plausibly suggesting (not 

merely consistent with)’ a showing of entitlement to 

relief.” Acceptance Ins. Co. v. United States, 583 F.3d 849, 

853 (Fed. Cir. 2009) (quoting Bell Atl. Corp. v. Twombly, 

550 U.S. 544, 557 (2007)). 

The facts as alleged “must be enough to raise a right 

to relief above the speculative level.” Twombly, 550 U.S. 

at 555. “This does not require the plaintiff to set out in 

detail the facts upon which the claim is based, but enough 

facts to state a claim to relief that is plausible on its face.” 

Cary v. United States, 552 F.3d 1373, 1376 (Fed. Cir. 

2009). “A claim has facial plausibility when the plaintiff 

pleads factual content that allows the court to draw the 

reasonable inference that the defendant is liable for the 

misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678

(2009).

Although pro se pleadings are liberally construed, 

Durr v. Nicholson, 400 F.3d 1375, 1380 (Fed. Cir. 2005), 

statement of the claims presented in the complaint.” 

Sahagun-Pelayo, 2014 WL 3643471, at *1 n.4. 

 

Case: 14-5126 Document: 26-2 Page: 5 Filed: 03/09/2015
6 SAHAGUN-PELAYO v. US

“a pro se plaintiff still must establish the requisite elements of his claim,” Humphrey v. United States, 52 Fed. 

Cl. 593, 595 (2002) (citing, e.g., Sanders v. United States, 

252 F.3d 1329, 1333 (Fed. Cir. 2001)). 

On appeal, Sahagun-Pelayo challenges only the dismissal of his contract claim.3 Although he mentions due 

process of law and deprivation of legal rights, SahagunPelayo does not explain these references, and does not 

make any specific allegations. Nor does he argue that the 

Court of Federal Claims applied the wrong law. In his 

Informal Reply Brief, moreover, Sahagun-Pelayo argues

that the Court of Federal Claims erred in dismissing his 

complaint because the government is in “[c]ontractual 

[d]efault.” Informal Reply 2. 

The government responds that the Court of Federal 

Claims correctly dismissed Sahagun-Pelayo’s complaint 

for failure to allege facts plausibly suggesting breach of an 

implied-in-fact contract. To establish a valid contract 

with the government, whether express or implied, a 

plaintiff must show: (1) mutuality of intent; 

(2) consideration; (3) an unambiguous offer and acceptance; and (4) actual authority on the part of the 

government’s representative to bind the government in 

contract. Kam-Almaz v. United States, 682 F.3d 1364, 

1368 (Fed. Cir. 2012). The government focused its motion 

to dismiss on the final element, arguing that SahagunPelayo’s complaint failed to allege that a government 

representative had the requisite actual authority to enter 

into a contract with him. 

3 Sahagun-Pelayo also asks this court to grant his

motion for production of documents. A prior panel of this 

court denied the motion on grounds that there is no right 

to discovery on appeal. Sahagun-Pelayo v. United States, 

No. 2014-5126 (Fed. Cir. Dec. 15, 2014), ECF No. 16. 

 

Case: 14-5126 Document: 26-2 Page: 6 Filed: 03/09/2015
SAHAGUN-PELAYO v. US 7

It is well established that a government official’s authority to bind the United States in contract can be express or implied. H. Landau & Co. v. United States, 886 

F.2d 322, 324 (Fed. Cir. 1989). “Authority to bind the 

government is generally implied when such authority is 

considered to be an integral part of the duties assigned to 

a government employee.” Id. (internal quotation and 

citation omitted). Accordingly, we have recognized that 

“[a]nyone entering into an agreement with the Government takes the risk of accurately ascertaining the authority of the agents who purport to act for the Government, 

and this risk remains with the contractor even when the 

Government agents themselves may have been unaware 

of the limitations on their authority.” Trauma Serv. 

Group v. United States, 104 F.3d 1321, 1325 (Fed. Cir. 

1997). 

Although Sahagun-Pelayo’s complaint contains vague 

allegations that he had a verbal agreement with the 

government, “[n]owhere in the complaint, or in plaintiff’s 

response brief, is a specific individual identified as having 

represented the United States in negotiating the alleged 

confidential informant contract with Mr. Sahagun-Pelayo. 

Nor is the specific agency that was to provide payment 

and other services to plaintiff identified.” SahagunPelayo, 2014 WL 3643471, at *3. As noted, in response to 

the government’s motion to dismiss, Sahagun-Pelayo 

added a new allegation that he met with government 

representatives from Washington, DC, who he believed 

had the authority to enter into a contractual agreement 

with him. Sahagun-Pelayo did not identify these individuals by name or by the government agency they represented. Given these circumstances, the Court of Federal 

Claims found “no plausible allegation in the complaint or 

in plaintiff’s response brief that anyone who spoke with 

Mr. Sahagun-Pelayo had express or implied actual authority to enter into a contract whereby plaintiff is now 

Case: 14-5126 Document: 26-2 Page: 7 Filed: 03/09/2015
8 SAHAGUN-PELAYO v. US

owed $84,717,000.” Id. at *6. For the reasons explained 

below, we agree. 

First, to the extent Sahagun-Pelayo believed that an 

unidentified government official or officials from Washington, DC possessed the authority to enter into a contract with him, that subjective belief is insufficient

because actual authority—not just apparent authority—is 

required to contract. See Winter v. Cath-dr/Balti Joint 

Venture, 497 F.3d 1339, 1344 (Fed. Cir. 2007) (“Where a 

party contracts with the government, apparent authority 

of the government’s agent . . . is not sufficient; an agent 

must have actual authority to bind the government.”). 

Sahagun-Pelayo has not alleged facts that plausibly 

suggest that any of the federal agents with whom he 

allegedly had contact had express or implied actual authority. Nor is there any indication that entering into 

agreements is an “integral part of the duties assigned” to 

any of those individuals. See H. Landau & Co., 886 F.2d 

at 324 (implied actual authority exists when the necessary authority is considered to be an “integral part of the 

duties assigned” to the particular government employee). 

In any event, as the Court of Federal Claims found, none 

of the individuals Sahagun-Pelayo mentions possessed the 

authority to enter into a contract requiring payment of 

$84,717,000. Sahagun-Pelayo, 2014 WL 3643471, at *6 

(“The type of authority is beyond the authority of the 

specific individuals identified in the complaint.”). 

Second, even if Sahagun-Pelayo’s response to the government’s motion to dismiss could be construed to include 

a statement alleging actual authority, “such a bare statement would be a mere legal conclusion which would not 

be entitled to the favorable inferences of a factual allegation.” Id. at *5. Finally, we agree with the Court of 

Federal Claims that Sahagun-Pelayo’s vague reference to 

an individual or individuals from Washington, DC is “not 

specific enough to survive a challenge to the sufficiency of 

the complaint.” Id. at *6. 

Case: 14-5126 Document: 26-2 Page: 8 Filed: 03/09/2015
SAHAGUN-PELAYO v. US 9

Sahagun-Pelayo contends that the Court of Federal 

Claims failed to consider the names of certain federal 

agencies and federal agents he identified in his complaint 

or in attachments thereto. To the contrary, the court 

described the allegations in Sahagun-Pelayo’s complaint, 

including the names of the federal agents with whom he 

allegedly had contact, and their respective agencies. The 

court found, however, that Sahagun-Pelayo “failed to 

allege facts as to the specific agent of the government who 

contracted with him, or as to the specific agency of the 

government that contracted with him.” Sahagun-Pelayo, 

2014 WL 3643471, at *5. The court further found that 

Sahagun-Pelayo’s “vague and inconsistent description of 

conversations he had with various federal agents lacks 

the [requisite] specificity.” Id. Given these deficiencies—

coupled with Sahagun-Pelayo’s failure to allege that any 

government employee had express or implied actual 

authority to enter into a contract with him—we agree 

with the Court of Federal Claims that Sahagun-Pelayo 

failed to state a claim for breach of an implied-in-fact 

contract. 

III. CONCLUSION

For the foregoing reasons, and because we find that 

Sahagun-Pelayo’s remaining arguments are without 

merit, we affirm the Court of Federal Claim’s final decision dismissing his breach of contract claim pursuant to

Rule 12(b)(6) for failure to state a claim upon which relief 

may be granted. 

AFFIRMED 

Case: 14-5126 Document: 26-2 Page: 9 Filed: 03/09/2015