Recovering Attorney Fees From The Government
In the U.S. legal system, generally each party pays their own costs and attorney fees. Known as the American Rule, absent certain circumstances like a breach of contract or claim under a statute that specifically allows for fees, even the prevailing party bears its own costs of litigation. Bid protests at the federal level are an exception to this rule, provided certain conditions are met. This article will describe how a successful protestor may obtain its costs of pursuing the litigation.
Attorney Fees At GAO
Bid protests can be filed at the agency level, the Court of Federal Claims, and the Government Accountability Office (GAO). Because of its expertise in public contract law, the GAO adjudicates most protests. When rendering decisions, it will either dismiss, deny, or sustain the protest. If sustained, the GAO may recommend that costs, attorney fees, and consultant and expert fees be paid to the successful protestor.
Another outcome in a GAO protest is agency corrective action. If the agency takes corrective action, GAO will dismiss the protest as academic since there is no longer a case or controversy. In these instances, the protestor may be entitled to attorney’s fees as well if the agency took corrective action in the face of a clearly meritorious protest but was delayed in doing so. Typically, if the agency takes corrective action before its report due date, GAO will not recommend award of protest costs.
If allowed expenses, the protestor has 60 days after receipt of the recommendation to file a detailed claim for costs. This claim must certify time and expenses and be supported by documentation. Generally, a maximum of $150 per hour will be allowed for legal fees. If the agency and protestor cannot agree on the amount of recovery, GAO will decide the matter.
Attorney Fees In Judicial Forums
In protests filed at the Court of Federal Claims (COFC), prevailing parties may recovery fees against the United States under the Equal Access To Justice Act (EAJA). Absent a waiver of sovereign immunity, a party may not recover attorney fees in suits against the government. The EAJA contains such a waiver, which enables certain parties to seek costs and attorney fees against the government under certain circumstances. Specifically, the EAJA provides that a court shall award to a prevailing party (other than the United States) fees and expenses incurred by that party in a civil action brought against the United States unless the court finds that the position of the government was substantially justified or special circumstances make such an award unjust.
In order to qualify, the protestor must be a prevailing party, the position of the United States must not be substantially justified, the petition must be timely filed, and the petitioner must have a net worth below the statutory cut-offs. Those seeking legal fees and costs under the EAJA must petition the court within 30 days of the final judgment with an itemized statement of the actual time expended and the rate at which fees and costs were computed. Additionally, the petition must contain all of the allegations required by the statute, including showing the petitioner was the prevailing party and is eligible for award and that the government’s position was not substantially justified.
Recovery of fees and costs does not occur in all bid protests. However, if a protestor can meet the burdens outlined in the governing statute or rule, pursuit of expenses is worthwhile. Legal fees add up quickly in these cases, and while a protestor may not obtain all of its costs associated with pursuing a claim due to statutory caps, some recovery will at least mitigate the expense.
Kristi Morgan Aronica, Attorney