________________________________________________________ PROTESTER'S MOTION FOR PARTIAL RULING ON ITS APPLICATION FOR PROTEST COSTS GRANTED: March 28, 1995 ________________________________________________________ GSBCA 12799-C(12705-P) COMMUNICATION NETWORK SYSTEMS, INC., Protester, v. DEPARTMENT OF COMMERCE, Respondent. Alan M. Grayson and Hugh J. Hurwitz of Law Offices of Alan M. Grayson, McLean, VA, counsel for Protester. Jerry A. Walz, Mark Langstein, Lisa J. Obayashi, and F. Jefferson Hughes, Office of the Assistant General Counsel for Finance and Litigation, Department of Commerce, Washington, DC, counsel for Respondent. Before Board Judges DEVINE, BORWICK, and WILLIAMS. WILLIAMS, Board Judge. On March 28, 1994, Communication Network Systems, Inc. (CNS), filed a motion to recover costs in the amount of $35,533.58 for pursuing its protest of a procurement by the Department of Commerce (DOC). Communication Network Systems, Inc. v. Department of Commerce, GSBCA 12705-P(12628-P), 94-2 BCA 26,843, 1994 BPD 63. On April 26, 1994, CNS filed an amended application for award of protest costs. Relying on the United States Court of Appeals for the Federal Circuit's decision in Sterling Federal Systems, Inc. v. Goldin, 16 F.3d 1177, 1188 (Fed Cir. 1994) (holding that West Virginia University Hospitals, Inc. v. Casey, 499 U.S. 83 (1991), does not preclude this Board from awarding in-house personnel and expert costs), remanding Sterling Federal Systems, Inc. v. NASA, GSBCA 10000-C(9835-P), 92-3 BCA 25,118, 1992 BPD 141, CNS sought an additional $12,890.32 for in-house personnel costs incurred during the protest. On February 7, 1995, CNS filed a request for a partial ruling on its application for costs, seeking $35,202.58 in undisputed costs. The partial request covered all costs except in-house personnel costs and a disputed amount of $331 in legal services. DOC does not object. On March 10, 1995, the Board granted in part Sterling's cost case on remand, concluding that the Board should continue to reimburse reasonable expert and consultant fees and in-house employee costs. Sterling Federal Systems, Inc. v. NASA, GSBCA 10000-C-REM(9835-P) (Mar. 10, 1995). The Board grants the unopposed request for reimbursement of costs and reopens the record to allow the parties to supplement the record as they deem appropriate on the issue of in-house costs consistent with Sterling.[foot #] 1 Background In the underlying protest, CNS challenged the award of three contracts by DOC to System Technology Associates, Inc. (STA). CNS successfully claimed that DOC failed to consider an appendix which contained CNS' corporate policies and procedures, and that DOC improperly disclosed to STA the government estimate of labor hours under the request for proposals. Communications Network Systems, Inc. v. Department of Commerce, GSBCA 12705-P(12628-P), 94-2 BCA 26,843, at 133,555, 1994 BPD 63, at 2-3. Granting the protest, the Board ordered DOC to empanel a new Source Evaluation Board, reopen discussions, provide the same information to all offerors, call for another round of best and final offers, and proceed in accordance with statute and regulation. Id. at 133,567, 1994 BPD 63, at 27. Originally, CNS was represented by the law firm of Cohen and White from October 4, 1993, to December 2, 1993. For this period, the firm charged CNS $11,901.25 for hourly fees and $293.65 for disbursements. CNS' Application for Award of Protest Costs at 4. During its representation of CNS, Cohen and White drafted the protest and protective order, replied to all pleadings, prepared discovery, and engaged in telephonic conferences with the parties. Id., Exhibit 1. Cohen and White's total fees amount to $12,194.90. On December 23, 1993, CNS retained the law offices of Alan M. Grayson (AMG) to continue the protest. The firm drafted motions, briefs, and a record submission; reviewed discovery; and participated in status conferences. Id., Exhibit 3. AMG charged CNS a flat retainer fee of $7,500, $10,196 for additional work not covered by the retainer agreement, $4,216 for preparing and filing CNS' motion for costs, and $847.83 for disbursements. Id. at 4-8. DOC does ----------- FOOTNOTE BEGINS --------- [foot #] 1 The Board recognizes that the parties have addressed that issue, but permits them to submit further briefing in light of the Board's analysis in Sterling on remand. ________ ----------- FOOTNOTE ENDS ----------- not contest the amounts charged by the two firms with the exception of $331 representing allegedly unrelated legal work performed by AMG. Respondent's Response to Protester's Motion for Costs at 1. The total uncontested portion of CNS' attorney fees amounts to $34,623.73. In addition to legal fees, CNS seeks to recover $578.85 in out-of-pocket expenses, related to photocopying, courier services, telephone calls, and facsimile transmissions. DOC does not contest these costs. Discussion By statute, the Board is empowered to award protest costs, including reasonable attorney's fees, and bid or proposal costs to an appropriate interested party. 40 U.S.C. 759(f)(5)(C) (1988). This statute "implies that a prevailing protester should be made whole from pursuing its protest so long as the fees and costs it seeks to recover are reasonable." United States v. Compusearch Software Systems, 936 F.2d 564, 566 (Fed. Cir. 1991). In the underlying protest, the Board granted CNS' protest and found that DOC erred by failing to properly evaluate CNS' proposals and impermissibly providing the government estimate of labor hours to the awardee. Communication Network Systems, Inc. v. Department of Commerce, GSBCA 12705-P(12628-P), 94-2 BCA 26,843, at 133,555, 1994 BPD 63, at 2-3. Based on our decision, CNS is a prevailing party which may seek reimbursement of its protest costs. The Board will examine the requested costs to ensure they are reasonable and related to the pursuit of the protest. SMS Data Products Group, Inc. v. Department of the Treasury, GSBCA 10783-C(10644-P)-REIN, 93-1 BCA 25,427, at 126,645, 1992 BPD 238, at 3. Attorney Fees Cohen and White charged hourly rates of $200, $140, and $120 for the three attorneys who worked on CNS' protest. CNS' Application for Award of Protest Costs, Exhibit 1. These rates are comparable to the hourly rates charged by Washington area law firms. See SMS Data Products Group, Inc. v. Department of Treasury, GSBCA 10783-C(10644-P)-REIN, 93-1 BCA 25,427, at 126,645, 1992 BPD 238, at 3-4 (stating that hourly rates in 1992 exceeded $250 for Washington, D.C. law firms). Given the nature of the issues, the total hours spent by Cohen and White initiating the protest, drafting the protest, and preparing discovery are reasonable. The Board also finds that AMG's $7,500 retainer fee was not excessive, since counsel spent 68.5 hours on this work. Pursuant to the retainer agreement, AMG sought admission under the Board's protective order, prepared a brief and record submission, responded to inquiries from government counsel, participated in status conferences, and provided advice regarding discovery. CNS' Application for Award of Protest Costs, Exhibits 2, 3. In addition to the retainer fee, AMG charged CNS at hourly rates of $130 and $250 for additional services performed beyond the scope of the retainer agreement. According to the retainer agreement, AMG was to research, prepare, and submit a record and brief, utilizing material released to Cohen and White. CNS' Application for Award of Protest Costs, Exhibit 2. Because this material was subsequently placed under a General Accounting Office protective order and AMG sought unsuccessfully to gain admission under that order, AMG had to duplicate Cohen and White's efforts, totalling an additional $1,897 for 13.3 hours of work. Id. at 5. After record submission, AMG also discussed settlement, prepared CNS' reply brief, attended a hearing, redacted documents, reviewed orders, and drafted a brief concerning the Government's hearing exhibit. CNS' Application for Award of Protest Costs at 6; id., Exhibit 3. Because these services were not covered by the retainer agreement, AMG charged CNS $7,968 for 50.3 hours of work. These total costs of $9,865 relate to services performed outside the scope of the retainer agreement, were supported by sufficient documentation, and are reasonable. SMS Data Products Group, Inc. v. Department of Treasury, GSBCA 10783-C(10644-P)-REIN, 93-1 BCA 25,427, at 126,427, 1992 BPD 238, at 3. In preparing and filing CNS' motion for costs, AMG charged $4,216 for 29.2 hours. A prevailing party may recover expenses for preparing, filing, and defending a cost motion. Aspect Telecommunications v. Department of Treasury, GSBCA 11399-C(11250-P), 93-1 BCA 25,423, at 126,633, 1992 BPD 245, at 8. Because the 29.2 hours are not excessive, redundant, or unnecessary, the Board finds that these costs were reasonable. Grumman Data Systems Corp. v. Department of the Air Force, GSBCA 11799 C-(11635-P), 93-2 BCA 25,773, at 128,245, 1993 BPD 16, at 8. Disbursements Cohen and White and AMG charged $293.65 and $847.83, respectively, for disbursements related to facsimile transmissions, copying, messenger services, postage, and telephone services. CNS' Application for Award of Protest Costs, Exhibits 1, 3. The Board has held that these types of costs are recoverable. Aspect Telecommunications v. Department of Treasury, GSBCA 11399-C(11250-P), 93-1 BCA 25,423, at 126,630, 1992 BPD 245, at 3. Both law firms have provided an itemized list. See Automated Business Systems & Services, Inc., GSBCA 9047-C(8972-P), 88-2 BCA 20,779, at 104,987, 1988 BPD 91, at 4. The Board finds that these disbursement costs were reasonable. CNS also seeks to recover $578.85 for in-house out-of-pocket expenses related to copying, courier services, and phone calls. CNS' Application for Award of Protest Costs, Exhibit 4. In Rocky Mountain Trading Co. v. Department of the Army, GSBCA 11033-C(10879-P), 93-2 BCA 25,775, at 128,249, 1993 BPD 20, at 3, the Board held that these types of costs are recoverable under 40 U.S.C. 759(f)(5)(c) (1988). The itemized out-of-pocket expenses were related to the underlying protest and are reasonable. Decision For the reasons stated above, we GRANT protester's motion for partial ruling on its application for protest costs and award protester $35,202.58. We defer ruling on the disputed costs, pending further development of the record. The parties are invited to supplement the record by April 14, 1995. __________________________ MARY ELLEN COSTER WILLIAMS Board Judge We concur: ____________________________ ____________________________ DONALD W. DEVINE ANTHONY S. BORWICK Board Judge Board Judge