Thank you for your suggestion. With the tailgate open when I push up on the latch (with a screwdriver shaft) the "finger" comes around the pencil but does not latch. I am assuming that it should latch like other latches on other cars.
Either the internal latching mechanism has broken or there is an electronic signal telling the latch to "release" (like if I was pushing the "unlatch" button). I guess I could unplug the latch to make sure there isn't an electronic "release" signal causing this failure. That would pretty much identify the problem as a defective latch.