MOTION FOR PROPOSAL PREPARATION COSTS GRANTED IN PART: August 27, 1993 GSBCA 12221-C(12012-P) FEDERAL COMPUTER CORPORATION, Protester, v. DEPARTMENT OF THE NAVY, Respondent. Gerard F. Doyle and Scott A. Ford of Doyle & Bachman, Washington, DC, counsel for Protester. Ellen D. Washington, Information Technology Acquisition Center, Department of the Navy, Washington, DC, counsel for Respondent. Before Board Judges DANIELS (Chairman), LaBELLA, and PARKER. DANIELS, Board Judge. Pursuant to 40 U.S.C. 759(f)(5)(C) and Board Rule 35, Federal Computer Corporation (FCC) has moved us to declare it entitled to the costs of filing and pursuing a protest in which it was a prevailing party, Centel Federal Systems, Inc. v. Department of the Navy, GSBCA 12011-P, et al., 93-2 BCA 25,648, 1992 BPD 359, as well as costs the firm incurred in preparing its proposal in the subject procurement. At the request of FCC and the respondent, the Department of the Navy, we bifurcated the case. On July 14, 1993, we granted FCC virtually all the costs it claimed as being associated with filing and pursuing the case -- $257,930.71. Federal Computer Corp. v. Department of the Navy, GSBCA 12221-C(12012-P), 1993 BPD 192. We now consider the firm's request for proposal preparation costs and associated attorney fees. The Board determined in Centel, 93-2 BCA 25,648, 1992 BPD 359, that in conducting the procurement in question, the Navy had violated requirements of statute and regulation in three specific ways which, taken together, were prejudicial to FCC and its fellow-protester. FCC has asked that we award it $2,694,608 in proposal costs that were allegedly wasted as a direct consequence of those violations. See Centel Federal Systems, Inc. v. Department of the Army, GSBCA 11315-C(11238-P), 92-2 BCA 25,000, 1992 BPD 102; Recognition Equipment Inc., GSBCA 9408-C(9363-P), 89-1 BCA 21,281, 1988 BPD 228. FCC has also asked for reimbursement of attorney fees which relate to the preparation of the claim for proposal costs. Protester has identified such fees as being in the amount of $12,012.50. We also now consider whether FCC should be granted $1,687.50 in attorney fees that relate to proposal costs, but which FCC characterized as protest costs. In ruling on protest costs earlier, we deferred review of the last amount until writing this opinion. With regard to the costs of proposal preparation itself, FCC used a two-step process to calculate the costs at issue. First, it documented the total costs it actually incurred in each of four stages of proposal development -- solution formation and team formation, live test demonstration preparation and performance, proposal development and negotiations, and best and final offer. Then FCC's president made estimates, based on his knowledge of the procurement, of the percentage of the costs at each stage which were wasted as a result of the Government's violations of law that were identified in the Board's decision in the underlying protest. The attorney fees sought are documented in appropriate detail. The Navy agrees that FCC is an appropriate interested party for the purpose of entitlement to reimbursement of proposal preparation costs. The parties have agreed that FCC is entitled to an award of $2,014,100, inclusive of attorney fees, stemming from costs that protester incurred. In the underlying protest case, FCC was one of two firms which challenged the Navy's contract award. We have already determined that FCC's fellow-protester, now known as Cordant, Inc., wasted a considerable part of its proposal preparation costs as a direct consequence of the Navy's improper procurement actions. We found that as a result of these violations of law and the Navy's decision to continue the procurement under revised terms, rather than award a contract to the lowest-priced offeror, each protester must make significant changes to its proposal and perform second live test demonstrations. In fixing the precise amount that Cordant wasted consequent to the violations, we were guided by the parties' agreement that the number they proposed represents reasonable compensation for Cordant's wasted efforts, irrespective of the outcome of the procurement. We explained that we would have no way to determine the correct percentage to apply to each of the categories of cost specified in the motion, apart from expert testimony, and because the parties had agreed on a total, we considered that securing such testimony would be an inappropriate use of resources. The amount specified for Cordant was virtually identical to the amount that FCC and the Navy now jointly request be awarded to FCC. Cordant, Inc. v. Department of the Navy, GSBCA 12226-C(12011-P), 1993 BPD 210 (July 30, 1993). For the reasons given in Cordant, we determine that FCC is entitled to an award, and that the sum stipulated by the parties as appropriate reimbursement for wasted proposal preparation costs and related attorney fees is reasonable. Decision FCC's application for reimbursement of costs incurred in preparing its proposal in the subject procurement, and associated attorney fees, is GRANTED IN PART. We award to FCC $2,014,100, to be paid, without interest, from the permanent indefinite judgment fund, 31 U.S.C. 1304 (1988). 40 U.S.C. 759(f)(5)(C) (1988). _________________________ STEPHEN M. DANIELS Board Judge We concur: _________________________ _________________________ VINCENT A. LaBELLA ROBERT W. PARKER Board Judge Board Judge