________________ GRANTED IN PART November 4, 1992 ________________ GSBCA 10747-C(10613-P) OLD STONE LEASING CORPORATION, Protester, v. DEPARTMENT OF THE ARMY, Respondent. James D. Bachman, Scott W. Woehr, and Ron R. Hutchinson of Doyle, Simmons & Bachman, Washington, DC, counsel for Protester. LTC Gregory E. Smith, CPT Andrew E. Squire, and Eileen G. Ginsburg, Defense Supply Service--Washington, Washington, DC, counsel for Respondent. Before Board Judges BORWICK, DANIELS, and VERGILIO. VERGILIO, Board Judge. On August 2, 1990, protester, Old Stone Leasing Corporation, filed a motion to recover its costs of filing and pursuing a protest granted by this Board. The Board twice stayed proceedings, pending the filing and disposition of an appeal to the United States Court of Appeals for the Federal Circuit. Protester twice amended its request for recovery. Protester seeks a total of $159,790.06 for filing and pursuing the protest, including amounts associated with defending the appeal. The respondent, the Department of the Army, Defense Supply Service--Washington, opposes an award of three portions of the requested amount. First, the agency would reduce the amount by costs which the agency attributes to pursuing one count of the protest which the Board denied. The agency views that count and the related costs as significant, severable and distinct from those issues on which protester prevailed. Second, the agency would not compensate protester in excess of what an outside courier would charge for performing the courier services billed by retained counsel at hourly rates. Third, the agency objects to reimbursing protester the attorney expenses for two meals, each consumed by two attorneys and the client. Protester prevailed in the underlying protest on significant issues. The costs associated with the protest count denied by the Board are not readily segregable and distinct from total costs; moreover, that count focused upon interpreting the underlying solicitation and contract--a matter not fully severable from the other issues. This is not an appropriate case in which to reduce the amount of recovery. Consistent with Board decisions issued subsequent to the submissions of the parties, the Board permits recovery of attorney fees incurred in performing courier services (those fees are roughly comparable to those of an outside courier, and are reasonable given the particular time constraints relating to the deliveries). The Board denies recovery of costs for lunches, the witness fees for the protester's president, and other in-house costs which are not taxable costs, and the amount associated with defending the appeal before the Federal Circuit. Thus, the Board grants the request in the amount of $149,128.10. Findings of Fact 1. In an opinion dated July 2, 1990, the Board granted the protest underlying this request for costs. Old Stone Leasing Corp., GSBCA 10613-P, 90-3 BCA 23,084, 1990 BPD 169. 2. On August 2, 1990, protester filed a motion, pursuant to Rule 35, seeking to recover $145,945.56, which it attributed to filing and pursuing the protest (including the preparation of the cost motion). That amount consists of attorney fees and expenses as well as in-house charges and expenses. 3. All of the hourly charges for retained counsel ($124,147.50) are well documented. Included in this amount are charges for courier-type services provided by an associate, a law clerk, and a paralegal. The documentation, and protester responses to interrogatories of the agency, suggest that multiple deliveries (filing with the Board and service on the agency) occurred during the billed time and consumed from 30 to 150 minutes each. On the whole, the use of these individuals resulted in charges comparable to those of an outside courier; moreover, several of these services were performed within specific time constraints, such that use of an outside courier may have been impracticable. The Board concludes that the entirety of the attorney fees incurred at the general hourly rates is reasonable. 4. The $15,058.15 in requested expenses incurred by retained counsel[foot #] 1 also are well documented and ----------- FOOTNOTE BEGINS --------- [foot #] 1 Protester's initial motion requested expenses incurred by retained counsel in the amount of $15,074.65. Thereafter, in response to an agency inquiry, protester reduced the amount requested by $16.50. Protester's Reply to Agency Opposition at 6 n.1 (Apr. 12, 1991). ----------- FOOTNOTE ENDS ----------- reasonable, and generally of the variety reimbursed by the Board as legal expenses or taxable costs. Sterling Federal Systems, Inc. v. National Aeronautics & Space Administration, GSBCA 10000- C(9835-P), 1992 BPD 141 (May 22, 1992), appeal filed, No. 92- 1552 (Fed. Cir. Sept. 21, 1992). The sole exception involves charges for two lunches consumed when witnesses were being prepared during long days of depositions. The client and two attorneys (three individuals) were at each lunch; the bills were $21.59 and $22.25. The record suggests that the witnesses prepared were local to the Washington, D.C. area. 5. The in-house amounts are broken into two categories-- salaried non-attorney employee costs and expenses. A total of $6,688.41 is sought for hours expended by protester's employees. This amount consists of $120 for witness fees (4 days at deposition or hearing at $30 per day) and $6,568.41 for prorated amounts of salaries (including customary bonuses and/or commissions) for various individuals. The witness fees are for two days of the corporate president, also the designated representative of protester at the hearing on the merits, and one day each for two other protester employees. Without further detail, a total of $35 is sought for expenses--$19 for office stationery and fax paper and $16 for two courier deliveries. Protester Motion, Exhibit B (Aug. 2, 1990). 6. At the request of the agency, which anticipated appealing the underlying protest decision, the Board stayed proceedings under the motion for costs by order dated August 7, 1990. By order issued November 7, 1990, the Board again stayed proceedings--the United States had appealed the underlying protest decision. The Board lifted that stay on February 22, 1991.[foot #] 2 7. Stating that as a result of the appeal to the Federal Circuit it "incurred additional costs and expended additional time and effort in pursuing its protest," protester supplemented its cost claim. It seeks an additional $6,177.50 in hourly fees paid to retained counsel and $181.31 in expenses. Of the hourly fees, $2,402.50 do not relate to actions taken in the appeal process; rather, the efforts were expended on matters related to the protest and cost motion. Protester's Motion, Exhibit B (Feb. 20, 1991). Of the expenses, $90.20 are for duplication of papers--it appears that all but $1.60 relate to pursuing the appeal. Id. Also, of the expenses, $91.11 are for automated legal research--it appears that the entirety of this amount relates to pursuing the appeal. Id. ----------- FOOTNOTE BEGINS --------- [foot #] 2 The Federal Circuit dismissed the appeal based on the unopposed motion of the United States, ordering that "[e]ach side is to bear its own costs." United ______ States v. Old Stone Leasing Corp., No. 91-1054 (Fed. Cir. Feb. ___________________________________ 11, 1991) (order not citable as precedent). ----------- FOOTNOTE ENDS ----------- 8. Protester submitted a response to a Board inquiry (on the appropriateness of requesting reimbursement of amounts associated with pursuing the appeal in light of the Federal Circuit's order that each party was to bear its own costs) and the agency opposition to the recoverability of certain costs. Protester Reply (Apr. 12, 1991). Protester also amended its cost claim to seek recovery for amounts expended in discovery on the cost matter and in relation to its response. Id. Protester seeks an additional $7,397.50 to cover charges of retained counsel (the motion details the efforts and hours expended as well as the hourly rates). Id., Exhibit A. Protester also seeks an additional $104.69 to cover expenses (duplication, courier services, postage, and automated legal research) which are detailed in the motion. Id., Exhibit B. Discussion Protester seeks to recover costs of filing and pursuing the underlying protest successfully. The agency opposes recovery of certain requested costs. In particular, the agency notes that protester filed a four-count protest; the Board granted two counts (counts I and III), denied one count (count II), and concluded that one catch-all count (count IV) was indistinguishable from the other three. The agency objects to permitting recovery for efforts incurred in pursuing any but the two granted bases of protest. Further, the agency objects to recovery of expenses for two meals and particular delivery costs- -protester seeks to recover for billed time of retained counsel who personally filed and/or served various documents; the agency would reduce recovery to reasonable charges of an outside courier. The cost motions and objections were submitted prior to the full Board rulings in Sterling (reversing earlier decisions, the Board determined that its authority to permit recovery of costs of filing and pursuing a protest is limited to attorney fees and taxable costs; specifically, non-testifying expert witness fees and in-house, non-attorney efforts are not recoverable beyond those recoverable as taxable costs) and Sysorex Information Systems, Inc. v. Department of the Treasury, GSBCA 10781-C(10642- P)-REIN, 1992 BPD 235 (Sept. 8, 1992) (reversing earlier decisions, the Board determined that it lacks authority to permit recovery of costs incurred on appeal). Neither party has sought to reopen the record in light of those decisions. Unsuccessful count of protest Referencing Rocky Mountain Trading Co., GSBCA 9750-C(9569- P), 90-3 BCA 23,040, 1990 BPD 147, and Julie Research Laboratories, Inc., GSBCA 9693-C(9474-P), 91-1 BCA 23,389, 1990 BPD 345, the agency contends that recovery of amounts associated with count II is inappropriate because that basis of protest was significant and readily severable and distinct in all respects from the issues of protest on which protester prevailed. The rationale of the above-cited cases compels a result contrary to that urged by the agency. Protester prevailed on the broader, more significant issues of its protest. While the Board denied count II of the underlying protest, all counts of the protest required an interpretation of the scope and extent of the underlying solicitation and contract. Thus, from a factual standpoint, the counts of protest were not fully severable and distinct. Further, quite reasonably, counsel did not approach all issues of protest as distinct in terms of developing the record or billing the client. Although the agency extrapolated a percentage of effort for counsel, based upon lines in the deposition and merit hearing transcripts, those figures suggest that protester did not spend an inordinate amount of effort on the denied issue of protest--somewhere between nine and fourteen percent of time expended. Agency Response at 15 (Apr. 5, 1991). It is the Board's sense that, based upon the factual and legal matters at issue in the case, the actual level of effort associated with the denied issue was likely less than these projections. Attorney fees for courier services Certain hourly fees of retained counsel were incurred in the filing and/or service of materials. Finding 3. The agency objects to reimbursing protester at the charged rates. The agency maintains that it is inappropriate to charge the Government for such use of attorney, law clerk or paralegal time. Rather, the agency would limit recovery to what it views to be reasonable charges for an outside courier. However, none of the charges appear to be excessive when compared to the rates of an outside courier--the agency failed to consider that multiple deliveries occurred during some of the billed hours--and the limited use of attorneys when particular deadlines loom in a fast-paced protest proceeding is not unreasonable or objectionable. Accordingly, the Board denies the agency's request to limit recovery. Meals The Board has treated as a reimbursable expense charges by retained counsel for working, overtime meals, billed to the client under the normal attorney-client fee arrangement, when consuming the meals was a reasonable and effective use of time spent in the protest. InSyst Corp., GSBCA 10143-C(10032-P), 90-1 BCA 22,464, 1989 BPD 361. Without a showing of the requisite nexus, the Board has disallowed such recovery. PacifiCorp Capital, Inc., GSBCA 9884-C(9733-P), 90-3 BCA 23,033, 1990 BPD 126. Here, the meals in question were lunches. Finding 4. Such food consumption for attorneys occurs during any normal workday and consequently is not properly reimbursed by the Government. To the extent that the charges represent the cost of a client's meal, that portion is neither an attorney fee or expense nor a taxable cost under statute, 28 U.S.C. 1821, 1920 (Supp. III 1991); Sterling. Recovery of a subsistence allowance is limited to instances when an overnight stay is required at a place of attendance far removed from the residence of the individual. Id. 1821(d)(1). Accordingly, the Board disallows recovery of $43.84. Sterling and Sysorex In light of the Sterling and Sysorex decisions of this Board, certain of the requested costs must be denied, even though the agency does not dispute the reasonableness of the incurred costs. In particular, consistent with Sterling, the Board denies the request for in-house, non-attorney employee efforts beyond requested witness fees ($6,568.41). Moreover, two of the days of witness fees are for the corporate president and designated representative of the protester at the hearing. Such costs for a party in interest are not statutory costs. Morrison v. Alleluia Cushion Co., 73 F.R.D. 70 (N.D. Miss. 1976). Thus, the Board grants $60 in requested witness fees and denies $60. Similarly, the record does not suggest that in-house expenses for stationery, fax paper, and courier deliveries were taxable costs- -that is, the record does not connect those costs to pursuing the protest; $35 is denied. Finding 5. As determined in Sysorex, the Board does not grant recovery for fees or expenses incurred on appeal. Of $6,177.50 sought in attorney fees under the first amended request, $2,402.50 relates to the protest before this Board, $3,775 to pursuing the appeal. Finding 7. The Board denies this latter amount. Similarly, of $181.31 sought in expenses under the first amended request, $1.60 relates to the protest before this Board and $179.71 to pursuing the appeal. Finding 7. The Board denies the latter amount. In its second amended request, protester seeks an additional amount for costs incurred in responding to agency discovery requests regarding the cost motion and the preparation of various submissions. Finding 8. The requested amount is reasonable; the Board grants recovery of the $7,502.19. Decision The Board concludes that protester is an appropriate interested party entitled to recover its costs of filing and pursuing the protest in the amount of $149,128.10. The Board denies recovery of $10,661.96, which represents lunches, in-house costs (which are neither "attorney fees" nor "taxable costs"), impermissible witness costs, and amounts incurred in defending the appeal at the Federal Circuit. Sterling; Sysorex. Accordingly, the Board GRANTS IN PART protester's motion. The amount awarded is to be paid in accordance with statute, 31 U.S.C. 1304 (1988); 40 U.S.C. 759(f)(5)(C) (1988). __________________________ JOSEPH A. VERGILIO Board Judge We concur: _____________________________ _____________________________ ANTHONY S. BORWICK STEPHEN M. DANIELS Board Judge Board Judge