Tolliver v. Federal Republic of Nigeria

• Decision Date: 06 June 2003
• Docket Number: No. 1:01-CV-290.,1:01-CV-290.
• Parties: Will TOLLIVER and Tradco Inc., a Michigan Corporation, Plaintiffs, v. FEDERAL REPUBLIC OF NIGERIA, Central Bank of Nigeria, Nigerian National Petroleum Corporation, and Donald E. Kilpatrick, Defendants.
• Court: U.S. District Court — Western District of Michigan

Page 873

265 F.Supp.2d 873

Will TOLLIVER and Tradco Inc., a Michigan Corporation, Plaintiffs, v. FEDERAL REPUBLIC OF NIGERIA, Central Bank of Nigeria, Nigerian National Petroleum Corporation, and Donald E. Kilpatrick, Defendants.

No. 1:01-CV-290.

United States District Court, W.D. Michigan, Southern Division.

June 6, 2003.

T.R. Knecht, Grand Rapids, MI, for Plaintiffs.

David J. Gass, Grand Rapids, MI, David H. Fromm, New York City, for Defendants.

OPINION

ENSLEN, District Judge.

Sing, siren, for thyself, and I will dote; Spread o'er the silver waves thy golden hairs, And as a bed I'll take them, and there lie.¹

INTRODUCTION

This matter is before the Court on Plaintiffs Will Tolliver and Tradco, Inc.'s Motion for Summary Judgement. It is also before the Court on the cross-motion for summary judgment of Defendants Federal Republic of Nigeria ("FRN"), Central Bank of Nigeria ("CBN") and Nigerian National Petroleum Corporation² ("NNPC") (collectively, "Governmental Defendants"). Upon review of the briefing, the Court determines that these motions can be resolved without additional argument or hearing. See W.D. Mich. L. Civ. R. 7.2(d).

BACKGROUND

Plaintiffs filed this suit on May 9, 2001, alleging fraud and breach of contract against Governmental Defendants. On December 20, 2002, Plaintiffs were permitted leave to amend their Complaint to add an additional party, Donald E. Kilpatrick. The First Amended Complaint was filed the same day. (See Dkt. No. 76.) Donald Kilpatrick is a Texas resident who, according to the First Amended Complaint, represented to Plaintiffs that he could assist them in obtaining payment from the Governmental Defendants. (First Amended Complaint, at ¶ 13.)

Plaintiffs' First Amended Complaint is stated in 10 counts. Counts I-V, IX and X are against Governmental Defendants only. (Id. at ¶ 1.) Count VI is against both Governmental Defendants and Defendant Kilpatrick. (Id.) Counts VII and VIII are only against Defendant Kilpatrick. (Id.)

Count I alleges breach of a June 1993 contract between Plaintiffs and NNPC. The contract promises payment by NNPC of $25 million in exchange for Plaintiffs providing technical advice to correct misalignment of a petroleum pipeline. (Gov't Defs.' Exh. C.) The NNPC contract was also purportedly guaranteed by the other Governmental Defendants, according to the supposed contract documentation. (Id.) Plaintiffs allege that they provided technical advice to correct pipeline misalignment to representatives of the NNPC, relating to the pipeline bedding conditions and pipeline weight. (First Amended Complaint, at ¶ 18.) Notwithstanding, Plaintiffs were not paid and now seek such payment. Count IX (which is redundant) also alleges breach of contract by Governmental Defendants in failing to pay the contract funds. (Id. at ¶ 83.)

Count II alleges fraudulent misrepresentation, to wit that Governmental Defendants misrepresented their authority, misrepresented the approval of officials in the Nigerian Government, and misrepresented that payment would be forthcoming on deposit of certain fees with the Governmental representatives. (Id. at ¶ 54.) Allegedly, Plaintiff both paid $500,000 in fees and pledged $30 million in Tradco, Inc. stock to facilitate payment of the contract amounts. (Id. at ¶ 56.) Count X alleges the similar misconduct based on the theory of innocent misrepresentation. (Id. at ¶¶ 88-91.)

Count III alleges promissory estoppel as a basis for holding Governmental Defendants liable on the NNPC contract. Plaintiffs allege detrimental reliance on promises of Governmental Defendants, including Plaintiffs' provision of consulting services and payment of advance fees on the contract. (Id. ar ¶ 58.) Count IV states essentially the same claims under an "unjust enrichment" theory. (Id. at ¶¶ 61-62.) Similarly, Count V seeks the same relief based on a theory of quantum meruit. (Id. at ¶¶ 67-68.)

Count VI alleges that Governmental Defendants and Defendant Kilpatrick engaged in a civil conspiracy to defraud Plaintiffs of both the funds paid to them and the value of the services rendered. (Id. at ¶¶ 70-71.)

Plaintiffs have filed evidence generally supporting the factual contentions in the Complaint. This evidence includes, most principally, the Affidavit of Will Tollivar which described how he entered into the contract after telephone conversations with supposed employees and officers of the Governmental Defendants including a "John Ogbal" of the NNPC, fulfilled his term of the contract (i.e.,> provided many hours of technical consulting, including project drawings), and made advance payments to obtain his contract award. (Tollivar Aff.) Larry Magnuson, a mechanical engineer, has supported Tollivar's claims in his Affidavit, which states that in 1993 he, working with Tollivar, prepared technical drawings relating to pipelines in connection with a project supposedly for the NNPC. (Magnuson Aff.)

Plaintiffs' evidence includes an Affidavit of Donald Kilpatrick, which purports to identify one of the government officials involved in the contract process—Dan Azumi Ibrahim—based on a meeting in London between Ibrahim and Kilpatrick at an official ministry of the Nigerian Government.³ (Kilpatrick Aff.) However, since the making of the affidavit, Kilpatrick has essentially recanted it by asserting his Fifth Amendment right against self-mcrimination in response to questions about his involvement in the events giving rise to this case and particularly in response to questions about the alleged meeting between himself and Ibrahim. (Kilpatrick Dep. at 7-16.)

Given the assertion of the Fifth Amendment, the Court will strike the Kilpatrick Affidavit because consideration of the Kilpatrick Affidavit would be grossly unfair to the Governmental Defendants given their inability to test the statements through discovery and cross-examination. See In re Edmond, 934 F.2d 1304, 1308 (4th Cir. 1991) (striking affidavit after assertion of Fifth Amendment rights by affiant and citing authorities); United States v. Parcels of Land, 903 F.2d 36, 43 (1st Cir.1990) (same); United States v. Inc. Village of Island Park, 888 F.Supp. 419 (E.D.N.Y. 1995). This control on affiant testimony is necessary to any system of due process because otherwise the use of such testimony would be an open invitation to "mutilate the truth." Brown v. United States, 356 U.S. 148, 156, 78 S.Ct. 622, 2 L.Ed.2d 589 (1958).

Another piece of evidence offered by Plaintiffs is the transcript of a telephone conversation purportedly between Donald Kilpatrick and Dan Ibrahim. (Pls.' Exhibit L.) However, this evidence is valueless in that the participation of Ibrahim in the telephone conversation was only authenticated by Kilpatrick and not by any independent source with personal knowledge of the voice of Ibrahim.⁴ See Fed.R.Evid. 901(b)(5).

Plaintiffs have also offered a number of "internet" documents as exhibits. The documents are simply news postings on the internet. Those documents are rife with hearsay and were not properly authenticated by persons with personal knowledge. Therefore, those documents will be stricken since they do not constitute proper evidence under Rule 56(e). See also St. Clair v. Johnny's Oyster & Shrimp, Inc., 76 F.Supp.2d 773, 775 (S.D.Tex.1999) (stating that unverified "evidence procured off the Internet is adequate for almost nothing ..."); Pirelli Armstrong Tire Corp. v. Titan Tire Corp., 4 F.Supp.2d 794 (C.D.Ill.1998) (excluding magazine articles as hearsay).

Finally, Plaintiffs have cited a number of discovery disputes between the parties as a reason for denying summary judgment to Governmental Defendants. These are cited for the purpose of indicating that Governmental Defendants (in Plaintiffs' judgment) were not cooperative during the course of discovery. Governmental Defendants, on the other hand, argue that the discovery has been sufficient and that, in any event, Plaintiffs' complaints now come too late. Some of Plaintiffs' complaints about discovery were also the subject of earlier orders by Magistrate Judge Joseph G. Scoville, which sought to provide sufficient, though limited, discovery to Plaintiffs. (See Order of Dec. 27, 2002.)

Governmental Defendants' theory of this case is that the events described in the Complaint are acts of criminal fraud by individuals having no association or connection with the sovereign state of Nigeria or any of its political departments. Governmental Defendants term the particular kind of fraud involved in this case as a "419" scam, referring to chapter 77, section 419 of the Nigerian Criminal Code which outlaws such scams. (Moses O. Adediran Decl. at ¶ 5.) See also, e.g., Southway v. Central Bank of Nigeria, 149 F.Supp.2d 1268, 1272 (D.Colo.2001), affd, 328 F.3d 1267 (10th Cir.2003).

Typical "419" scams are operated by individuals, who pose as Nigerian government officials or businessmen, offering to pay fantastic sums of money on government contracts. The victim is, typically, induced to make a series of "advance fee" payments as a condition for the receipt of the contract award. Of course, when the victim becomes dissatisfied, then the imposters disappear. See, e.g., United States v. Scott-Emuakpor, 2000 WL 288443, at *1 (W.D.Mich.2000). The propensity of these scams to bilk unknowing Americans is such that the United States State Department has issued official warnings about these scams to its citizens. (Adediran Decl. at ¶ 11; Gov't Defs.' Exh. F.)

To support this theory of the case, Governmental Defendants have provided the Declarations of Otu Medo (the Acting General Manager of the Litigation Property Law Department of the NNPC) and Moses Adediran (the Director of the Legal Department of the CBN). Otu Medo declares that he has inspected the various contract documents filed by Plaintiffs and that they are fakes. (Medo Decl. at ¶ 12.) This declaration is based on the failure of Plaintiffs to engage in the kind of competitive bidding...