____________________________________________ COSTS GRANTED IN PART: February 9, 1993 ____________________________________________ GSBCA 11639-C(10945(7703)-REIN) TELE-SENTRY SECURITY, INC., Appellant, v. GENERAL SERVICES ADMINISTRATION, Respondent. Kenneth K. Takahashi, Takahashi & Associates, P.C., Rockville, MD, counsel for Appellant. Robert W. Schlattman, Office of General Counsel, General Services Administration, Washington, DC, counsel for Respondent. Before Board Judges LaBELLA, HENDLEY, and BORWICK. HENDLEY, Board Judge. This case is yet another arising from Tele-Sentry Security, Inc.'s (Tele-Sentry) contract to install and maintain an alarm system at the Richard B. Russell Federal Building in Atlanta, Georgia, from 1981-82. Having won about three-quarters of the claim for equitable adjustment it presented to the Board, the appellant now seeks to recover approximately $172,592.75[foot #] 1 in attorney's fees and expenses, pursuant to the Equal Access to Justice Act (EAJA), 5 U.S.C. 504 (Supp. II 1990). ----------- FOOTNOTE BEGINS --------- [foot #] 1 As the Supreme Court noted in Hensley v. ___________ Eckerhart, "[w]here settlement is not possible, the fee applicant _________ bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates." 461 U.S. 424, 437 (1983). After reviewing the appellant's documentation, we found discrepancies between the appellant's totals and ours, often with the appellant's figure lower. Since we perform so many reductions to reach our result, we work strictly on the numbers found in the appellant's exhibits. ----------- FOOTNOTE ENDS ----------- The respondent, the General Services Administration (GSA), conceded that the appellant is a "substantially prevailing" party, for EAJA purposes, although it contests the reasonableness of the appellant's specific dollar claims. Respondent's Response to Appellant's EAJA Application (June 8, 1992). For the reasons stated below, we deny the appellant all salary expenses, attorney's fees incurred before the Bankruptcy Court, and costs incurred in appealing our decision. After making these deductions, we award the appellant 75% of the remaining attorney hours claimed, plus travel expenses for witnesses and attorneys, plus fee petition preparation costs. Background On September 13, 1982, the appellant filed a certified claim for an equitable adjustment of $122,832.28 with the contracting officer, reserving the right to subsequently add additional increases to that amount. Appeal File, GSBCA 10945(7703)-REIN, Exhibit 22. On February 23, 1984, the appellant filed a "consolidated claim" for $351,591.51 with the contracting officer. Id., Exhibit 28. The contracting officer issued a final decision on September 26, 1984, in which the Government conceded liability for extra work and delay costs in the amount of $127,584, but denied interest for the period between September 13, 1982, and September 26, 1984, and liability for claim preparation costs and Davis-Bacon Act reimbursements. The appellant appealed the contracting officer's decision to this Board on January 28, 1985, and we adjudicated that appeal. Tele- Sentry Security, Inc., GSBCA 10945(7703)-REIN, 91-2 BCA 23,880, at 119,613, aff'd per curiam, 950 F.2d 730 (Fed. Cir. 1991). Earlier, in 1990, in a separate appeal, we denied the appellant's attorney's fees and costs incurred before the United States Bankruptcy Court. Tele-Sentry Security, Inc., GSBCA 9084-C, 91-1 BCA 23,658 (1990). In our "merits" decision on the delay claim, Tele-Sentry Security, Inc., GSBCA 10945(7703)-REIN, 91-2 BCA 23,880, we denied the appellant: 1) $61,590.20 withheld pursuant to the Davis-Bacon Act, 40 U.S.C. 276(a) (1988); 2) $13,889 in claim preparation fees; and 3) excessive computer costs. In addition to seeking unrecoverable costs, the appellant failed to segregate the delay costs incurred solely due to Government misconduct from those that it was responsible for. We then used the "jury verdict" method to reduce the remainder of the appellant's claim by another 25%, for a final award of $202,000, plus interest, pursuant to 41 U.S.C. 611 (1988). The appellant appealed that decision to the Court of Appeals for the Federal Circuit, which affirmed our decision on November 14, 1991. Tele-Sentry Security, Inc. v. United States, 950 F.2d 730 (Fed. Cir. 1991). The appellant filed this application for fees and costs on December 17, 1991. In its application, the appellant seeks attorney's fees incurred before three tribunals: (1) this Board, (2) the U.S. Bankruptcy Court in Arizona, and (3) the Federal Circuit. The appellant has also asked for lost salaries of Tele- Sentry employees who served as witnesses in the case, claim preparation expenses, and travel expenses for the witnesses and attorneys. Discussion Attorney's Fees For the lead attorneys on the underlying appeal, the appellant has requested the following amounts: 1. William G. Tenerowicz $75 x 174 hours = $13,050.00 2. Terry McPalmer $75 x 160 hours = $12,000 3. Kenneth Takahashi $75 x 92 hours = $6,900 (1986) $75 x 336.5 hours = $25,237.50 (1987) $75 x 2.5 hours = $187.50 (1988) $75 x 2 hours = $150 (1989) $75 x 5.75 hours = $431.25 (1990) $75 x 3 hours = $225 (1991) (reviewing the Board's decision, dated April 4, 1991) $75 x 63.5 hours = $4,762.50 (1991) (preparing brief and oral argument for the appeal to the Federal Circuit) Fee petition preparation: $600 (1991) 4. James Leather $5,220 (preparing motion for the United States Bankruptcy Court of Arizona to enjoin respondent from terminating the construction contract for default) Application for Fee and Expenses Under Equal Access to Justice Act at 2-6 (December 17, 1991). The four lawyers' total fee claim, less the $600 in fee petition preparation, is $70,163.75. We have twice denied the appellant's costs and attorney's fees incurred in proceedings before the U.S. Bankruptcy Court. Tele-Sentry Security, Inc., GSBCA 9084-C, 91-1 BCA 23,658 (1990); Tele-Sentry Security, Inc., GSBCA 8950, 9093, 92-3 BCA 25,088 (1992). This amount includes $5,220 paid to bankruptcy attorney James Leather. We are puzzled that the appellant did not delete this amount from its petition, especially after we issued our second ruling on this issue. The appellant's claim is barred. See Zinger Construction, Inc. v. General Services Administration, GSBCA 11039-R-R, slip op. at 4 (Aug. 31, 1992) (Board applies principles of res judicata to bar contractor from recharacterizing appeal brought, and denied, three times). Thus, we deduct $5,220 from the attorney's fee claim. From the remainder, $64,943.75, we deduct the $4,762.50 incurred by the appellant for work done in its case before the Court of Appeals for the Federal Circuit. This deduction is required because we have no jurisdiction to make any such award, there being a specific and separate statutory provision for recovery of costs for court cases, 28 U.S.C. 2412. Moreover, the claim is patently frivolous inasmuch as the appellant did not prevail at the Federal Circuit. Considering the appellant's eligibility for the remaining $60,181.25, we exercise the discretion that EAJA affords us to adjust the award. The EAJA states that the agency shall pay fees and other expenses that a "prevailing party" incurred in connection with the proceeding: unless the adjudicative officer of the agency finds that the position of the agency was substantially justified or that special circumstances make an award unjust. Whether or not the position of the agency was substantially justified shall be determined on the basis of the administrative record, as a whole, which is made in the adversary adjudication for which fees and other expenses are sought. 5 U.S.C. 504(a)(1) (Supp. II 1990). The respondent has conceded that the appellant is a "prevailing party" for the purposes of EAJA but urges us to reduce the total award on the grounds that the Government's position overall was "substantially justified." The Supreme Court has instructed us that the Government's position is "substantially justified" if it is justified in substance or in the main: "that is, justified to a degree that could satisfy a reasonable person." Pierce v. Underwood, 487 U.S. 552, 565 (1988). Our problem with the appellant's case is that while its quite distinct primary claim was a good one, and the respondent's opposition was not "substantially justified," its other claims were without merit. Ever mindful of the Supreme Court's admonition that a "request for attorney's fees should not result in a second major litigation," Hensley v. Eckerhart, 461 U.S. 424, 437 (1983), we will be brief. We will look at the record as a whole, and evaluate it in substance. First, we do not conclude that the respondent's position as to the quantum of the appellant's delay claim was "substantially justified." We are loathe to award the appellant all the attorney's fees it seeks, since we found at the merits stage that the appellant itself was responsible for about 25% of its delays. We have decided a cost case analogous to the one at bar, Atlas Construction Co. v. General Services Administration, GSBCA 11088- C(8653), et al., 92-2 BCA 24,944. As here, the hearing on the appeal concerned only the quantum of expenses that the contractor allegedly incurred, and we denied the contractor about $50,000 of claimed unabsorbed overhead and claim preparation expenses. Id. at 124,329. At the EAJA stage, we found it necessary to deny the contractor attorney's fees and costs it incurred to fight the two "losing" counts, but the contractor had not segregated the hours spent on each issue. Id. Since we found that $50,000 represented about one-third of the contractor's final recovery, we cut one-third from the contractor's fee request in making the EAJA award. Id. at 124,330. We take the same approach here. Perhaps it would be impossible for the appellant to show what time it spent failing to prove that the Government was solely responsible for that final 25% of delays. Again being mindful that in Hensley, 461 U.S. at 439, the Court ordered lower tribunals to award "only that amount of fees that is reasonable in relation to the result obtained," we cannot overlook the fact that we were forced to resort to the use of a "jury verdict" in determining quantum because the appellant presented a disorganized accounting of its costs, Tele-Sentry, 91-2 BCA at 119,618. We find that we can achieve an equitable result by awarding the appellant 75% of $60,181.25, the remaining reimbursable hours claimed, or $45,135.94. We also award the appellant its $600 EAJA fee petition preparation cost in full. See Devine v. Sutermeister, 733 F.2d 892, 899 (Fed. Cir. 1984) (fee petition preparation expenses recoverable). Thus, the appellant can recover $45,735.94 in attorney's fees. Costs The appellant has claimed $107,384 in costs, which consist of travel expenses, consultant fees, and the salaries of the appellant's employees employees who served as witnesses in the case. The appellant lumped attorney's fees, plus money for work done before the Bankruptcy Court, into this "cost" figure, including: $5,220 in attorney's fees attributable to James Leather's work before the U.S. Bankruptcy Court; $11,000 described as "Federal Bankruptcy Court Affirmed & Affirmed Fees for Chuck Hanes to represent TSSI for GSA claim;" plus $3,680 described as "(5) Sets of GSA Claim;" and a "salary" of $2,520 for attorney Kenneth Takahashi. First, the appellant cannot recover any litigation costs which it incurred prior to the "date on which [the appellant] received the contracting officer's decision," or September 26, 1984, which marks the beginning of adversary "adjudication" for the purposes of the EAJA. American Power, Inc., GSBCA 10558- C(8752), 91-2 BCA 23,766, at 119,046; see also Levernier Construction, Inc. v. United States, 947 F.2d 497, 500 (Fed. Cir. 1991) (interpreting the EAJA applicable to the federal courts, 28 U.S.C. 2412(a)(1)(A) (1988); eligibility for fees begins only after receipt of adverse decision from the contracting officer; includes fees for preparing appeal to the court, but not costs of preparing claim for the contracting officer). Unrecoverable costs incurred during this period include the $11,220 in salaries and expenses paid to Charles Hanes, since his work ended before the contracting officer issued his decision on September 26, 1984. It also includes amounts incurred by employees Paul Kostal ($949) and Leonard Espinoza ($940), since they completed their work in 1982, long before the issuance of the final decision in September 1984. Likewise, travel, per diem, and other miscellaneous costs incurred by Robert Brown ($3,704) and James E. Watt ($12,207) before September 26, 1984, are unrecoverable. Neither can appellant recover salaries totalling $32,700 that Robert Brown and James Watt would have earned either before or after issuance of the contracting officer's final decision. While the EAJA indeed permits recovery of fees paid to qualified expert witnesses, it does not allow recovery of the salaries that officers or employees would have earned had they been at work instead of at court. Naekel v. Department of Transportation, 845 F.2d 976, 981 (Fed. Cir. 1988); Quality Diesel Engines, GSBCA 11237-C(10805-COM), 91-3 BCA 24,331, at 121,567-68; American Power, 91-2 BCA, at 119,048-49. Next, we will not award as a cost the "salary" paid to Kenneth Takahashi. The appellant has recovered the attorney's fees for Mr. Takahashi's services at the EAJA $75 per-hour rate, but cannot recover a "salary" as well. Moreover, the documentation indicates that the amount is for work done before the Bankruptcy Court prior to the receipt of the contracting officer's final decision. For the reasons stated in our discussion of recoverable attorney's fees, we deny the $5,220 for the services of attorney James Leather in this "cost" claim. Again, Mr. Leather is an attorney who should recover under the EAJA $75 per-hour rule, if at all; he performed the services at the Bankruptcy Court, not the Board, and did so before the contracting officer rendered a final decision. We also deduct the $3,680 for the five sets of the GSA claim, because the documentation again indicates that these were provided to the Bankruptcy Court. Thus, we have reduced the appellant's cost claim by over three-quarters. We find that recoverable expenses include $5,089 attributable to attorney Kenneth Takahashi; $2,300 for attorney William Tenerowicz; $8,597 for appellant's employee Robert Brown; $5,188 for appellant's president James E. Watt; and court reporting costs of $843, all incurred after the contracting officer issued his final decision on September 26, 1984. Generally, the Board awards all reasonable travel and per diem expenses incurred after issuance of the contracting officer's final decision in full. Jordan & Nobles Construction Co. v. General Services Administration, GSBCA 11277-C, et al., slip op. at 8-9 (June 29, 1992) (travel and incidental expenses). Here, we are willing to do so because the appellant seeks no more than a $75 per diem, which is the applicable Government rate for the years in question. Government's Expense Rates at 2 (March 4, 1992). The air fares, cab fares, and car rental expenses likewise appear reasonable, and we thus award all of these costs incurred after the contracting officer issued his final decision on September 26, 1984, or $22,017, in full. Decision The appellant's cost motion is GRANTED IN PART. The appellant is entitled to $45,735.94 in attorney's fees and $22,017 in costs incurred, for a total of $67,752.94, without interest. _____________________________ JAMES W. HENDLEY Board Judge We concur: _____________________________ _____________________________ VINCENT A. LaBELLA ANTHONY S. BORWICK Board Judge Board Judge