QUIMBA SOFTWARE, INC v. USA

Filing 146

**Redocketed for Administrative Purposes** REPORTED ORDER: granting in part and denying in part 142 Motion for Attorney Fees; granting in part and denying in part 143 Motion for Attorney Fees; granting 144 Motion for Leave to File. Signed by Senior Judge Loren A. Smith. (ar) Service on parties made.

United States Court of Federal Claims
No. 12-142 C
Filed: November 9, 2018

QUIMBA SOFTWARE, INC.,
Plaintiff,
v.
THE UNITED STATES,
Defendant.

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Equal Access to Justice Act attorney’s
fees; attorney’s fees; attorney’s costs;
attorney’s expenses; plaintiff’s expenses;
consultant fees

William Thomas Welch, McMahon, Welch & Learned, Reston, V.A., for plaintiff.
Paul Davis Oliver, United States Department of Justice, Civil Division, Washington, D.C., for defendant.
ORDER
SMITH, Senior Judge

This action is before the Court on plaintiff and defendant’s proposed attorney’s fee and
cost award calculations under the Equal Access to Justice Act (“EAJA”). Plaintiff, Quimba
Software, Inc. (“Quimba”), is a small business that contracted with the United States Air Force
Research Laboratory, Air Force Material Command of the United States Air Force (“Air Force”)
to provide information technology research services. On April 27, 2018, the Court granted
Quimba’s motion for attorney’s fees and costs pursuant to the EAJA and ordered the parties to
provide proposed fee and cost calculations. Opinion and Order Granting Plaintiff’s Motion for
Attorney Fees, ECF No. 138 at 9. The parties filed separate calculations, and the government
subsequently filed a motion seeking leave to file corrected calculations, as well as the corrected
calculations themselves. Pursuant to the April 27, 2018 Order, and consistent with the EAJA,
the Court awards the plaintiff $98,919.68 in attorney’s fees, attorney’s expenses, and expert
consultant fees.
I.

Background

On March 1, 2012, Quimba filed its Complaint with this Court pursuant to the Contract
Disputes Act, seeking a declaration that the Contracting Officer’s Final Decision disallowing
plaintiff’s owners’ deferred compensation costs was null and void, and that such costs were
allowable under the Federal Acquisition Regulation (“FAR”) and the contract terms. Quimba
Software, Inc. v. United States, 132 Fed. Cl. 676, 677 (2017) (hereinafter “Quimba I”) (citing 41
U.S.C. § 7104(b)). On June 26, 2017, the Court entered judgment in favor of plaintiff, holding
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that the deferred compensation in question was allowable in Quimba’s Incurred Cost Proposal
and that the circumstances causing such a deferral were not foreseeable. Id. at 682-83.
On November 7, 2017, plaintiff filed its Motion for Attorney Fees and Costs, claiming
entitlement to fees at full market rates as an eligible small business under Section 2412(d) of the
EAJA. See generally Plaintiff’s Motion for Attorney Fees and Costs Pursuant to EAJA, ECF
No. 129 (hereinafter “P’s EAJA Motion”). On April 27, 2018, the Court granted the Motion,
finding that “Quimba is entitled to recover its attorney’s fees and expenses [capped at $125 per
hour] with a cost of living adjustment (“COLA”), pursuant to 28 U.S.C. § 2412, and that its
interest on its § 2412 claim began to accrue from the date its application was filed on December
21, 2017.” Opinion and Order Granting Plaintiff’s Motion for Attorney Fees (hereinafter
“Quimba II”) ECF No. 138 at 9. Additionally, the Court directed the parties to file a joint status
report stipulating to the amount of attorney’s fees and costs owed to Quimba. Id.
The parties failed to stipulate to the amount of attorney’s fees and costs, and instead filed
separate proposed calculations on June 6, 2018. See generally Defendant’s Status Report
(hereinafter “D’s AFCs I”), ECF No. 143; Plaintiff’s Proposed Fees and Costs in Support of Its
Claim Under the Equal Access to Justice Act (hereinafter “P’s AFCs”), ECF No. 142. On June
12, 2018, the government filed a motion for leave to file corrected calculations of fees and costs
owed to Quimba and a status report containing the government’s corrected attorney’s fee
calculations. See generally Defendant’s Motion Seeking Leave to File a Corrected Calculation
of Fees and Costs That Plaintiff is Entitled to Under This Court’s Decision, ECF No. 144; Status
Report: Defendant’s Corrected Calculations of Attorney Fees and Costs Under the Equal Access
to Justice Act (hereinafter “D’s AFCs II”).
II.

Proposed Attorney Fees and Costs Calculations
A. Quimba’s Proposed Calculations and Claimed Entitlement

Quimba claims it is entitled to a total of $237,073.26 in attorney’s fees, attorney’s costs,
Federal Acquisition Regulations and Cost Accounting Standards (“FAR/CAS”) expert consultant
fees’, compensation for Quimba’s founder’s time, and reimbursement for direct costs incurred in
connection with this litigation. See generally P’s AFCs. In Quimba II, the Court held that
Quimba is entitled to attorney’s fees calculated using the EAJA capped rate of $125 per hour
with an upward COLA. Quimba II at 9. Quimba’s undisputed COLA-statutory-capped hourly
rate calculations vary from $184.33 to $201.11 per hour, depending on when the attorneys
performed the work. P’s EAJA Motion, Ex. 3A. Quimba’s attorneys allegedly worked 469.6
hours, for an undisputed total of $90,084.08. P’s AFCs at 2-3. Additionally, Quimba claims a
total of $4,555.29 in attorney’s fees for tax-related advice associated with the litigation. Id. at 4.
Quimba alleges that it is entitled to litigation expenses incurred by its attorneys and
directly incurred by Quimba. Id. at 4-5. These expenses include $2,958.58 in costs incurred by
its litigation attorneys for travel, mailing, and other necessary expenses, and $140.48 in costs
incurred by its tax attorney. Id. at 4. Quimba’s directly incurred expenses include $1,181.25 in
the FAR/CAS expert consultant fees, as well as $14,228.58 in travel expenses incurred by

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Quimba’s founder for meeting with attorneys, attending hearings, and attending depositions. Id.
at 5.
Additionally, Quimba contends that it is entitled to $125,925 in compensation for the
1679 hours Quimba’s founder spent meeting with attorneys, conducting research, drafting
complaints, preparing for depositions, attending hearings, attending depositions, and
participating in settlement negotiations. P’s AFCs Ex. 8. Quimba calculated this amount by
multiplying the 1679 hours allegedly worked by $75 per hour—the rate the Air Force agreed to
compensate Quimba for government contract work. Id.; P’s AFCs at 5. The following is a
summary of Quimba’s position:
Quimba’s Claimed Entitlement
Description

COLA

Attorney Fees - Mc Mahon, Welch, and Learned (Litigation
Attorneys)(469.6 Hours @ $184.33/hr for 2/27/12 - 8/14/12;
$187.06/hr for 1/30/13 - 2/28/13; $190.03/hr for 1/2/14 12/7/14; $190.27 from 1/6/15 - 12/21/15; $192.68 from
1/26/16 - 12/16/16; $196.77 from 1/9/17 - 12/28/17; $201.11
from 1/3/18 - 5/23/18) (Ex. 3).
Attorney Fees - Bell, Davis, and Pitt (Tax Attorneys) (Ex. 5)
Litigation Attorney Expenses - Mc Mahon, Welch, and
Learned (Ex. 3 at 66, plaintiff’s initial motion for attorney
fees.)
Tax Attorney Expenses - Bell, Davis, and Pitt (Ex. 5)
FAR/CAS Consultant - Nicholas Sanders (Ex. 6)
Quimba Costs (Quimba Owner’s expenses for air, hotel,
ground transportation, mileage, meals for meeting with
attorneys and attending hearings, depos, etc…) (Ex. 7).
Quimba Labor - 1679 hrs @ $75/hr (Quimba owner’s time
meeting with attorneys, research, drafting complaints and
depos, attending hearings, attending depos, settlement
negotiations, etc…) (Ex. 8).
TOTAL

$90,084.08
$4,555.29

$2,958.58
$140.48
$1,181.25

$14,228.58

$125,925.00
$239,073.26

Id. at 2-6.
B. The Government’s Calculations and Claimed Liability
The government argues that Quimba is only entitled to a total of $81,881.87. D’s AFCs
II at 4. The government does not dispute that Quimba spent the claimed amount as a result of the
litigation, but asserts that Quimba’s entitlement is limited to the COLA-statutory-capped
attorney’s fees less the total uncapped amount that Quimba’s attorneys billed for denied motions
($94,639.37 – $12,757.50). Id. The government contends that Quimba is not entitled to these
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fees because the denied motion for summary judgment, the denied motion for protective order,
and the denied motion to dismiss did not contribute to Quimba’s success. D’s AFCs I at 1. The
government does not attempt to explain why the proposed deduction associated with these failed
motions should be based on $385 and $395 per hour rate—not the COLA-statutory-capped rates
ranging from $187.06 to $190.03, which were used to calculate the basis of the award.
The government also maintains that Quimba is not entitled to the FAR/CAS expert
consultant fees, expenses directly incurred by Quimba, and the costs associated with the time
Quimba’s founder spent supporting the litigation effort because Quimba’s attorneys did not
directly incur these costs. D’s AFCs II at 2-4. The government also denies liability for expenses
incurred by Quimba’s attorneys, but refrains from providing an explanation for this denial. Id. at
4. The following is a summary of the government’s position:
Government Claimed Liability
Description
Attorney Fees - Mc Mahon, Welch, and Learned (Litigation
Attorneys) 469.6 hrs @$184.33 to $201.11/hr.
Attorney Fees - Bell, Davis, and Pitt (Tax Attorneys)
Less fees incurred in connection with denied motions
(Summary Judgment-12hrs @ $385/hr; Motion for protective
order-8.1hrs @ $385, $395/hr; MTD -13hrs @ $385/hr .)
TOTAL

COLA
$90,084.08
$4,555.29

($12,757.50)
$81,881.87

Id. at 1.
III.

Discussion
A. Standard of Review

Under the EAJA, a plaintiff is entitled to recover limited costs incurred for litigating
successful claims. 28 U.S.C. § 2412 (b), (d)(2)(A). Once a plaintiff has met the conditions
prescribed by the EAJA, “[i]t remains for the [trial] court to determine what fee is reasonable.”
Comm’r, I.N.S. v. Jean, 496 U.S. 154, 161 (1990) (internal quotations omitted). In making this
determination, “[t]he trial court has considerable discretion.” Hubbard v. United States, 480
F.3d 1327, 1334-35 (Fed. Cir. 2007). For example, the Court has discretion to “reduce the
amount to be awarded . . . or deny an award, to the extent that the prevailing party . . . unduly
and unreasonably protracted the final resolution of the matter in controversy.” 28 U.S.C. §
2412(d)(1)(C). In Quimba II, the Court found that Quimba prevailed for purposes of the EAJA.
Quimba II at 9. The Court must now determine the amount Quimba is entitled to recover.
B. Attorney’s Fees
A plaintiff is entitled to attorney’s fees limited to $125 per hour unless the Court
determines that a COLA is justified. 28 U.S.C. § 2412 (d)(2)(A). In Quimba II, the Court
determined that Quimba is entitled to a COLA. Id. at 9. Quimba’s uncontested rates are
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consistent with the EAJA guidelines and the direction given in Quimba II. Therefore, the Court
finds that Quimba’s attorney’s fee rates are reasonable. Furthermore, the uncontested number of
hours Quimba’s attorneys claim to have expended on the litigation are also reasonable.
The parties do not dispute that Quimba’s attorneys spent 469.6 hours on litigation, but the
parties disagree as to whether Quimba is entitled to fees associated with denied motions. D’s
AFCs I at 2-6. The government argues that the motions did not contribute to Quimba’s success
but unreasonably protracted litigation, and, as a result, they are not compensable. Id. The
government claims that the award should be reduced by the amount Quimba’s attorneys billed
for time spent on denied motions. Id. Quimba alleges that the government’s assertions are
unreasonable, arguing that decisions to file such motions are strategic and contributed to a
successful litigation strategy. P’s AFCs at 6-8. The Court is persuaded by plaintiff’s argument.
In quantifying reasonable attorney’s fees, the Court must first start with “the number of
hours reasonably expended on the litigation multiplied by a reasonable hourly rate.” Hubbard,
480 F.3d at 1332 (citing Hensley v. Eckerhart, 461 U.S. 424 (1983)). The Court may then either
increase or decrease this amount “based on a number of factors, of which ‘the most critical factor
is the degree of success obtained.’” Id. at 1332 (citing Hensley, 461 U.S. at 436). Where the
plaintiff has prevailed, “the fee award should not be reduced simply because the plaintiff failed
to prevail on every contention raised in the lawsuit.” Hensley, 461 U.S. at 435; see also Jean,
496 U.S. at 163 n.10 (Hensley standard of reasonableness of fees applies to EAJA); Sabo v.
United States, 127 Fed. Cl. 606, 634 (2016), aff’d, 717 F. App’x 986 (Fed. Cir. 2017); Baldi
Bros. Constructors v. United States, 52 Fed. Cl. 78, 82 (2002). Also, under the EAJA, the
plaintiff’s attorney’s fees award may be reduced if the plaintiff “unduly and unreasonably
protracted the final resolution of the matter in controversy.” 28 U.S.C. § 2412 (d)(1)(C).
The Court finds that Quimba reasonably obtained information and advanced their
position through these denied motions. The Court does not believe that the failed motions for
summary judgment, motion for protective order, and motion to dismiss unduly or unreasonably
protracted the final resolution of this case. As such, the Court finds that Quimba’s attorney’s
fees are reasonable and should not be decreased by time spent on failed motions. Additionally,
the attorney’s fees award should not be decreased relative to the degree of Quimba’s success
litigating, and as such, Quimba is entitled to $94,639.37 in attorney’s fees.
C. Attorney’s Expenses
Quimba contends that it is entitled to the following attorney expenses: court filing fees,
postage, and travel. P’s AFCs at 5. The government concedes that the EAJA permits a plaintiff
to recover expenses incurred by attorneys and does not dispute the reasonableness of the alleged
expenses. D’s AFCs II at 2. However, the government does not concede that Quimba is entitled
to those expenses. See generally D’s AFCs II.
The EAJA permits a plaintiff to recoup attorney’s fees including “the reasonable
expenses of expert witnesses, the reasonable cost of any study, analysis, engineering report, test,
or project which is found by the court to be necessary for the preparation of the party’s case.” 28
U.S.C. § 2412 (d)(2)(A). These examples are not exhaustive. Oliveira v. United States, 827
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F.2d 735, 744 (Fed. Cir. 1987). The Court has discretion to “award only those reasonable and
necessary expenses of an attorney incurred or paid in preparation for trial of the specific case
before the court, which expenses are those customarily charged to the client where the case is
tried.” Id. A plaintiff is not entitled to attorney expenses “not incurred or expended solely or
exclusively in connection with the case before the court, or . . . expenses the court finds to be
unreasonable or unnecessary in the pending litigation.” Id.; see also United Partition Sys., Inc. v.
United States, 95 Fed. Cl. 42, 63 (2010) (finding that reasonable court reporter fees and
photocopying expenses are customarily charged to the client and qualify as expenses under 28
U.S.C. § 2412).
Attorneys customarily charge clients for the type of expenses at issue. Quimba’s
attorneys reasonably and necessarily incurred these expenses through the normal course of
litigation and solely for the purposes of litigating this matter. Quimba incurred $2,958.58 for
litigation attorney expenses, and $140.48 for tax attorney expenses. As such, plaintiff is entitled
to $3,099.06 in attorney’s expenses.
D. Consultant Fees
Quimba claims it is entitled to costs for retaining the services of a consultant with
expertise in the FAR and CAS. P’s AFCs at 5. The FAR/CAS expert consultant analyzed the
government’s arguments related to the FAR and cost accounting, and provided the opinion
Quimba used in forming its litigation strategy. Id. The government asserts that the EAJA limits
Quimba’s award to only expenses incurred by attorneys, and denies liability for the FAR/CAS
fees because Quimba—not their attorneys—directly incurred these expenses. D’s AFCs at 2.
A plaintiff may recover “the reasonable expenses of expert witnesses, the reasonable cost
of any study, analysis, engineering report, test, or project which is found by the court to be
necessary for the preparation of the party’s case.” 28 U.S.C. § 2412(d)(2)(A) (emphasis added).
Costs associated with hiring expert consultants are recoverable under the EAJA when the
government’s position is not substantially justified, even if the expert does not testify. KMS
Fusion, Inc. v. United States, 39 Fed. Cl. 593, 606 (1997) (finding expenses associated with
retaining an expert to assist in preparation for trial are recoverable).
In Quimba II, the Court found that the government’s position was not substantially
justified. Quimba II at 7. The Court finds that it was reasonable and necessary for Quimba to
retain the FAR/CAS expert consultant to review, analyze, and provide an opinion, and that such
an opinion was instrumental to litigation. Quimba should not bear the financial burden of
carrying out its due diligence. KMS Fusion, 39 Fed. Cl. at 606. Therefore, Quimba is entitled to
recover $1,181.25 in costs associated with retaining the FAR/CAS expert consultant.
E. Other Costs Incurred Directly by Quimba.
Quimba argues it is entitled to reimbursement for expenses it directly incurred and
compensation for its founder’s time spent supporting the litigation efforts. P’s AFCs at 5-6.
Those expenses largely consist of travel and lodging costs incurred by Quimba’s founder to
attend meetings with counsel, depositions, and hearings. P’s AFCs Ex. 7. Quimba attempts to
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justify entitlement for labor costs by arguing that its founder’s assistance decreased the legal
fees. P’s AFCs at 5. Plaintiff argues that $75 per hour is a reasonable rate because the Air Force
originally agreed to compensate Quimba’s founder at $75 per hour for services under the original
contract. Id.
The government asserts that Quimba cannot recoup expenses it itself incurred, arguing
that the EAJA only permits recovery of expenses incurred by attorneys and expert witnesses.
D’s AFCs II at 2-3. Similarly, the government contests compensating Quimba for the time its
founder spent supporting the litigation effort, because Quimba’s attorneys did not directly incur
these costs, and Quimba’s founder is not an attorney. Id. at 4. The Court finds this argument
persuasive.
The EAJA distinguishes between expenses incurred by a plaintiff and those incurred by
attorneys and experts. Baldi Bros. Constructors v. United States, 52 Fed. Cl. 78, 86 (2002). The
EAJA does not permit recovery of expenses incurred directly by a plaintiff. Id. at 87. For
example, “while non-local travel and other expenses incurred by attorneys are compensable
under the EAJA, a contractor may not recover travel expenses for itself.” Id. at 86; Carmichael
v. United States, 70 Fed. Cl. 81, 86-87 (2006) (reducing the EAJA award by the plaintiff’s travel
expenses even though the plaintiff assisted the attorney by performing paralegal services). In
Baldi, the Court denied the plaintiff’s claim for expenses incurred by their project manager
because the attorney did not incur those expenses. Baldi, 52 Fed. Cl. at 87. Similarly, Quimba’s
founder incurred the expenses at issue here, and, as such, Quimba is not entitled to recover their
founder’s expenses under the EAJA.
The EAJA also does not permit recovery of costs or compensation for time associated
with plaintiff’s labor supporting litigation. Fanning, Phillips, Molnar v. West, 160 F.3d 717, 722
(Fed. Cir. 1998) (stating that the EAJA does not allow for recovery of damages for “lost
opportunity costs of employee or principal time associated with prosecuting a claim”). The
EAJA limits recovery to fees billed by experts, attorneys, or “non-attorney practitioners who are
authorized to represent clients only with special permission of a given tribunal.” Id. at 721. In
Fanning, the Court upheld the Department of Veteran Affairs Board of Contract Appeals’
decision denying the plaintiff’s claim for damages stemming from the time the plaintiff’s
principal and employees spent supporting the litigation effort. Id. at 722. The Court found these
damages were not compensable under the EAJA because the principal and employees were not
attorneys, specialized non-attorney practitioners, or outside specialists retained to support the
litigation. Id. Similarly, Quimba’s founder is not an attorney or an agent as contemplated by the
EAJA. Therefore, Quimba’s founder’s time is not compensable under the EAJA guidelines.
IV.

Conclusion

Pursuant to the EAJA, the Court finds that plaintiff is entitled to recover a total of
$98,919.68 in attorney’s fees and costs associated with litigation, including COLA-capped
attorney’s fees, attorney expenses, and expert consultant fees as summarized below. The
plaintiff is also entitled to interest accruing from December 21, 2017, to the day the government
pays the amount awarded to the plaintiff. The following is a summary of the award, not
including interest:
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Quimba’s Entitlement
COLA
Adjusted

Description
Attorney Fees - Mc Mahon, Welch, and Learned (469.6 Hours
@ $184.33/hr for 2/27/12 - 8/14/12; $187.06/hr for 1/30/13 2/28/13; $190.03/hr for 1/2/14 - 12/7/14; $190.27 from 1/6/15
- 12/21/15; $192.68 from 1/26/16 - 12/16/16; $196.77 from
1/9/17 to 12/28/17; $201.11 from 1/3/18 - 5/23/18).
Attorney Fees - Bell, Davis, and Pitt.

$90,084.08
$4,555.29

Attorney Costs - Mc Mahon, Welch, and Learned.
Attorney Costs - Bell, Davis, and Pitt.
FAR/CAS Consultant - Nicholas Sanders.
Total (not including interest for $98,919.68 accruing from
12/21/2017)

$2,958.58
$140.48
$1,181.25
$98,919.68

For the reasons set forth above, the defendant’s Motion for leave to file corrected
calculations and costs is GRANTED. Both the plaintiff’s and the defendant’s calculations and
costs are GRANTED in part and DENIED in part. Plaintiff is awarded $98,919.68.
IT IS SO ORDERED.

s/

Loren A. Smith

Loren A. Smith,
Senior Judge

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