_________________________

                         GRANTED: November 6, 1997
                         _________________________


                           GSBCA 13408-C(12906)


                               TEEMS, INC.,

                                   Applicant, 

                                    v.

                     GENERAL SERVICES ADMINISTRATION,

                                   Respondent.

     Brett A. Alcala of Birnbaum, Umeda, Alcala & Alper, Redwood
City, CA, counsel for Applicant.

     Robert T. Hoff, Office of General Counsel, General Services
Administration, Washington, DC, counsel for Respondent.

Before Board Judges BORWICK, VERGILIO, and GOODMAN.

VERGILIO, Board Judge.

     Teems, Inc. has filed this application to recover costs
related to filing and pursuing an appeal at this Board involving
the respondent, the General Services Administration.  The agency
asserts that its position was substantially justified and that
Teems was not a prevailing party in the underlying case in which
the agency converted the challenged termination for default to
one for the convenience of the Government.

     The Board concludes that Teems is a prevailing, eligible
party under the Equal Access to Justice Act, 5 U.S.C.  504
(1994), to recover its costs; that the position of the Government
was not substantially justified; and that special circumstances
do not exist which would make an award unjust.  Teems seeks to be
reimbursed solely for the fees and expenses it paid, $6,800.74. 
The record supports reimbursement of that amount.  The Board
grants the application.

                             Findings of Fact

     1.   In the appeal underlying this cost application, Teems
disputed the agency's termination for default of the portion of
its requirements contract for 1.5" nozzles.  While the appeal was
pending at the Board, the contracting officer issued a unilateral
contract modification converting the termination for default to a
termination for convenience.  Thereafter, the Board dismissed
with prejudice the appeal.  Teems, Inc. v. General Services
Administration, GSBCA 12906 (Aug. 4, 1995).

     2.   The evidentiary record in the underlying appeal reveals
that, prior to the termination for default, the agency was aware
of Teems' assertions that, with regard to the first article
samples which were rejected and formed the basis for the default
determination, the Government tested utilizing uncalibrated
equipment and the incorrect standard.  Exhibits 22, 24, 33, 34,
37.  Prior to the termination for default, the agency knew that
those assertions were confirmed by an individual from the Small
Business Administration, who witnessed the test, and by a
Government employee involved in the rejection.  Exhibits 35, 41,
45, 46.  Teems had submitted test results from an independent
laboratory confirming the acceptability of its product; the
agency has produced no valid test results to support the
rejection.  Some of these facts are further explained in the
opinion of the Board dealing with a dispute over reimbursement
regarding Teems' request for an equitable adjustment and
termination for convenience settlement proposal.  Teems, Inc. v.
General Services Administration, GSBCA 14090 (Oct. 31, 1997).

     3.   Teems timely filed a cost application seeking an award
of costs related to filing and pursuing the underlying appeal.  5
U.S.C.  504; Rule 35 (48 CFR 6101.35 (1995).

     4.   Teems maintains through an unrebutted declaration that,
at the time it initiated the underlying appeal, its net worth was
below $7 million and it had four employees.  Application,
Exhibits A, A-1.

     5.   Teems retained a law firm to file and pursue the
underlying appeal at agreed-upon hourly rates of $185 and $165
for each of two attorneys.  On some date unspecified in the
record, when a settlement was not reached initially, Teems and
the law firm agreed that all fees for the balance of attorney
efforts would be payable contingent upon the outcome of the
appeal and the amount of money Teems obtained under a termination
settlement proposal and request for an equitable adjustment.  The
attorneys expended 144.75 hours in pursuing the appeal of the
default termination.  An attorney has expended 28.5 hours on this
application.  Application at 11-13 and Exhibits A, B, B-1; Teems
Submission (dated Jan. 21, 1997) at 2.  The law firm has billed
Teems $867.68 for expenses (long distance telephone, travel, and
delivery services).  Application, Exhibit B-2.  Teems has paid
$6,200.74 of the legal fees and expenses billed; this amount was
paid prior to September 1995, and prior to the subsequent
litigation.  Application, Exhibit B-3.

     6.   Teems expended $600 for a non-refundable airline ticket
for its expert to observe a Government-scheduled test.  Exhibit
A.

     7.   The law firm has waived payment of any amount in
addition to what Teems has paid.  Teems seeks to recover
$6,800.74--the amount paid to the law firm ($6,200.74) and the
price of the ticket ($600).  Teems Submission (dated Jan. 21,
1997).

                                Discussion

Eligibility

     Given the time frame of the underlying adjudication, an
eligible party includes a corporation with a net worth not in
excess of $7 million and with not more than 500 employees--the
value and size as of the time the adversary adjudication was
initiated.  5 U.S.C.  504(b)(1)(B).  Teems is an eligible party
to recover.

Prevailing Party and Substantial Justification

     A prevailing, eligible applicant is entitled to relief
unless the Board finds that the position of the agency was
substantially justified or that special circumstances make an
award unjust.  5 U.S.C.  504(a)(1), (b)(1)(E).  In reply to the
application, the agency "submits that the existing administrative
record clearly demonstrates that the Government's position was
substantially justified and, further, that TEEMS was not a
prevailing party under GSBCA Rule 35(a)."  Agency Reply at 1.

     During the course of this litigation, Teems obtained the
relief it sought: the agency converted the termination for
default to a termination for the convenience of the Government. 
The agency has not suggested, and the record does not suggest,
that the relief came about for any reason apart from the pending
litigation.  Austin v. Department of Commerce, 742 F.2d 1417,
1419-20 (1984) (a party may prevail through a settlement).  Teems
is a prevailing party.

     The record in the underlying appeal belies the assertions of
the agency.  The agency default terminated the contract with the
knowledge that the tests used to support the rejection of the
articles and the default were conducted using uncalibrated
equipment.  Teems had put forward test results from an
independent laboratory indicating that the article rejected by
the agency was compliant with contract requirements.  The agency
has not referenced a reliable test result which supports its
conclusion of non-compliance.

     The position of the agency was not substantially justified. 
No circumstance in this case makes an award unjust.


Quantum

     Teems has incurred and paid legal fees and expenses (legal
and airline ticketing), 5 U.S.C.  504(b)(1)(A), totaling
$6,800.74.  Given the reimbursable legal expenses, the hours
expended in filing and pursuing the cost application, and the
efforts involved in the underlying appeal, this amount does not
reflect hourly attorney fees of in excess of $75, the applicable,
maximum reimbursable rate.  Id.

                                 Decision

     The Board GRANTS the application.  Teems is entitled to
recover $6,800.74, the amount it seeks.



                                   ____________________________
                                   JOSEPH A. VERGILIO
                                   Board Judge
We concur:



____________________________       ____________________________
ANTHONY S. BORWICK                 ALLAN H. GOODMAN
Board Judge                        Board Judge