Reyes-Colon v. United States, 974 F.3d 56

Eagle Support, Inc. contracted with the U.S. Postal Service (USPS) to provide highway mail-transportation services; the contract placed responsibility for vehicle purchase, maintenance, and driver inspections on Eagle.
While performing contract work an Eagle driver rear-ended a school bus, severely injuring two minors; plaintiffs allege the truck’s poor maintenance (especially tires) caused the crash.
Plaintiffs exhausted administrative remedies and sued under the Federal Tort Claims Act (FTCA), accusing USPS of negligently failing to inspect Eagle’s vehicles.
The district court dismissed for lack of subject-matter jurisdiction, invoking the FTCA’s discretionary-function exception.
On appeal the First Circuit accepted the complaint’s well-pled allegations but affirmed dismissal, holding USPS’s failure-to-inspect decision was discretionary and protected by the discretionary-function exception; plaintiffs’ discovery arguments were not preserved below.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether USPS’s failure to inspect contractor vehicles was non-discretionary because of a regulation or contract term	Plaintiffs: Postal Handbook, contract clauses, and an Eagle interrogatory show USPS was required to inspect, so conduct was non-discretionary	USPS: No statute, regulation, or mandatory contract provision compelled USPS to inspect; at most the contract reserved a discretionary right to inspect	Held: No mandatory directive shown; inaction was discretionary
Whether the discretionary-function exception applies (i.e., whether decision involves policy judgment)	Plaintiffs: If USPS violated a mandatory rule, its acts lack policy content and aren’t protected	USPS: Decision to contract out transport and to allocate inspection duties involves policy balancing (cost, efficiency, safety) protected from judicial second-guessing	Held: Presumption that discretion involves policy applies; exception shields USPS from FTCA liability
Whether denial of discovery deprived plaintiffs of opportunity to develop facts about contract language	Plaintiffs: Ambiguities (e.g., “spotted”) and referenced exhibits required discovery to show USPS had a mandatory inspection duty	USPS: Plaintiffs failed to present these specific discovery theories below; arguments are forfeited on appeal	Held: Discovery arguments were not preserved in district court; appellate court declines to consider them

United States v. Gaubert, 499 U.S. 315 (1991) (when statute or regulation grants discretion, courts presume acts involve policy and are protected)
Berkovitz v. United States, 486 U.S. 531 (1988) (discretionary-function analysis requires checking for a mandatory directive)
Varig Airlines, United States v. S.A. Empresa de Viacao Aerea Rio Grandense, 467 U.S. 797 (1984) (discretionary-function exception protects policy-based governmental actions)
Mahon v. United States, 742 F.3d 11 (1st Cir. 2014) (FTCA jurisdiction and discretionary-function framework application)
Muñiz-Rivera v. United States, 326 F.3d 8 (1st Cir. 2003) (absence of statutory or regulatory directive renders inaction discretionary)
Carroll v. United States, 661 F.3d 87 (1st Cir. 2011) (interpret FTCA strictly in favor of government; delegation to contractors can reflect policy choices)
Fothergill v. United States, 566 F.3d 248 (1st Cir. 2009) (clarifies two-step discretionary-function inquiry)