COFC Awards Attorneys' Fees; Air Force
Unreasonably Interpreted Small Business Act
The U.S. Court of Federal Claims Feb. 15 awarded a contractor $37,227 in attorneys' fees and costs under the Equal Access to Justice Act (EAJA) in connection with the Air Force's violation of the Small Business Act (DGR Associates Inc. v. United States, Fed. Cl., No. 10-396C, 2/15/11).
Judge Thomas C. Wheeler found that the Air Force's position was not substantially justified in the underlying litigation, holding that DGR Associates Inc. did not waive its right to bring suit and rejecting the argument that the Air Force was not required to give priority to Historically Underutilized Small Business Zone (HUBZone) small business concerns.
DGR prevailed in its bid protest against the Air Force's award of housing maintenance, inspection, and repair services at Eielson Air Force Base, Alaska.
The court's injunction required the Air Force to terminate the contract award and apply the statutory HUBZone preference in a new or revised solicitation (94 FCR 206, 8/24/10). DGR then applied for attorneys' fees under the EAJA.
The court said DGR satisfied the EAJA's timeliness and net worth and size requirements for receiving an award. It also held that DGR was a prevailing party under the EAJA because it succeeded on all of its arguments concerning the Air Force's failure to apply the statutory preference for HUBZone small business concerns.
The court then said the Air Force's litigation position was not substantially justified.
Waiver Argument Was ?Patently Unreasonable.'
The Air Force argued that DGR had waived its right to bring suit by not filing its action prior to the closing date for receipt of proposals. The court held, however, that because DGR followed applicable protest procedures, diligently pursued its challenge, and prevailed at the Government Accountability Office, it would be unjust to dismiss DGR's protest.
?By any measure, Defendant's waiver argument was patently unreasonable and not substantially justified,? the court held.
Small Business Act Requirement is Unambiguous
The Air Force also argued that the interpretation of the Small Business Act and its implementing regulations was a novel issue, and therefore its position was substantially justified.
However, the court found the statute's wording and existing case law precedent to be unambiguous. When DGR filed suit in June 2010, multiple courts and the GAO uniformly had held the Small Business Act unambiguously required the HUBZone program to receive preference over other small business programs.
In addition, the court explained that had the Air Force simply chose to follow GAO's decision, DGR's lawsuit would have been unnecessary. The Air Force was unreasonable in putting DGR to additional effort and expense given the clear statutory language, the court said.
Finally, the court said the government's position was unreasonable due to the lack of any legislative history contrary to the statute's plain language.
As a result, the court awarded DGR attorneys' fees and costs.http://op.bna.com/fc...pen=dsen-8e7pjh
The AF tried.