In the United States Court of Federal Claims

No. 99-2051C

Filed: July 21, 2020

ROBERT M. ATHEY, et al.,

 Plaintiffs,

v.

THE UNITED STATES,

 Defendant.

Keywords: Equal Access to 

Justice Act; EAJA; 28 USC § 

2412; Attorney’s Fees; Class 

Action; Position of the United 

States; Substantially Justified;

Notice to Class.

Ira M. Lechner, Washington, D.C., for Plaintiffs.

Bryan M. Byrd, Trial Attorney, Reginald T. Blades, Jr., Assistant Director, Robert E. Kirshman, 

Jr., Director, and Ethan P. Davis, Assistant Attorney General, Civil Division, United States 

Department of Justice, with whom was Gia Chemsian, Department of Veteran Affairs, 

Washington D.C., for Defendant.

MEMORANDUM OPINION AND ORDER

TAPP, Judge. 1

At the epilogue of protracted class action litigation, following a lump-sum settlement 

between the Department of Veterans Affairs (“the VA”) and the class action plaintiffs (the 

“Class”), the Class seeks payment of attorney fees and expenses pursuant to the Equal Access to 

Justice Act (EAJA), 28 U.S.C. § 2412. Resolution of this issue requires the Court to juxtapose 

the Class’s modest success on the merits with notice requirements and firmly rooted 

jurisprudence governing the payment of attorney fees and expenses where the position of the 

United States was substantially justified. 

The Court reluctantly concludes these considerations preclude recovery. While this 

outcome does not implicate the financial interests of the Class, it directly affects Class counsel. 

Of equal importance, because recovery of the expenses of litigation is inexorably linked to the 

criteria of EAJA for attorney fees, the as-yet unpaid third-party Class Administrator is left adrift, 

burdened by continuing duties to the Class with no certainty of payment. Because the Class does 

 1 This matter was initially assigned to Judge Loren A. Smith, reassigned to Judge Mary Ellen 

Coster Williams (ECF No. 203) in 2013, Judge Patricia Elaine Campbell-Smith (ECF No. 210) 

in 2014, and to the undersigned on December 3, 2019 (ECF No. 320). 
2

not satisfy the conditions of 28 U.S.C. § 2412(b) or (d), the Motion for Attorney Fees (ECF No. 

324) is DENIED.

I. Background

The history of this litigation is well-documented. The Class comprises former employees 

of the VA. Athey v. United States, 908 F.3d 696, 698 (Fed. Cir. 2018). From 1993 through 1999, 

the Class members retired or separated from the VA. Id. In the Complaint, filed June 21, 2006,2

the Class claimed the VA omitted pay increases from lump-sum payments received upon 

termination of their employment. Id. at 698–99; see also (Am. Compl., ECF No. 2).3 These pay 

increases included Cost of Living Adjustments (COLA), Locality Pay Adjustments, Sunday 

premium pay, as well as evening and weekend pay.4 Finally, Class members sought prejudgment 

interest under the Back Pay Act, 5 U.S.C. § 5596. Athey, 908 F.3d at 699.

In widely separated decisions, the Court determined that (1) “additional pay,” which class 

members contended should have been included in the lump-sum payouts received by class 

members upon separation from the VA, did not include evening and weekend pay; (2) nonGeneral Schedule employees were not entitled to relief; (3) Sunday pay was not available after 

October 1, 1997, Athey v. United States, 78 Fed. Cl. 157, 161–63 (2007) (“Athey I”); and (4) the 

Class was barred from recovering pre-judgment interest. Athey v. United States, 123 Fed. Cl. 42, 

61 (2015) (“Athey III”). 

In early 2017, the parties entered into a final settlement agreement resolving the 

remaining claim between the parties. Athey v. United States, 132 Fed. Cl. 683 (2017) (“Athey 

IV”), aff'd, 908 F.3d 696 (Fed. Cir. 2018) (“Athey V”). During the fairness hearing, both parties 

acknowledged that the settlement agreement did not provide for payment of attorney fees 

pursuant to the Back Pay Act. (ECF No. 293). The Class thereafter appealed the decisions in 

Athey I and Athey III. Athey V, 908 F.3d at 696. The Federal Circuit affirmed each of the trial 

court rulings thus ending the merits litigation. Id. at 710.

The settlement agreement provided for the payment of $637,347.37 consisting of 

$570,374.49 in lump-sum pay and $66,972.88 for the employer’s contribution of employmentrelated taxes to the Class consisting of 3,231 members. Athey IV, 132 Fed. Cl. at 687. On May 

17, 2019, the Class filed its first Motion for Attorney Fees which the United States opposed on 

June 13, 2019 as deficient and premature due to the possibility the parties would be able to 

 2 This case was severed from Archuleta et al. v. United States, Case No. 99-205C.

3 The Court cites to many documents throughout this opinion, some only once. To avoid clutter, 

the Court cites only to the CM/ECF document number for many of these passing references.

4 Employees of other federal agencies have initiated similar challenges to lump sum and back 

pay practices. See U.S. Gen. Accounting Office, GGD-97-100, Federal Civilian Personnel: Cost 

of Lump-Sum Annual Leave Payments to Employees Separating from Government (May 29, 

1997) (Noting differences in agency practices regarding back pay and filing of court cases); see 

also Kandel v. United States, 85 Fed. Cl. 437 (2009) (involving employees of United States 

Information Agency, the Resolution Trust Corporation, and the Nuclear Regulatory Agency); 

Archuleta et al. v. United States, Case No. 99-205C (involving employees of an additional 17 

agencies not including those involved in Kandel). 
3

resolve the fees dispute. The Court stayed this case to facilitate those negotiations. On December 

19, 2019, the Court lifted that stay and permitted the class administrator to distribute sums in 

accordance with the settlement agreement. The Class’s present motion for attorney’s fees and 

expenses and supporting brief followed on January 13, 2020.5 (Pl.’s Second Mot. for Atty. Fees, 

ECF No. 324-4 (“Pl.’s Brief”)). The United States responded on February 12, 2020. (Def.’s 

Resp., ECF No. 326). The Class filed its reply in support on March 20, 2020. (Pl.’s Reply, ECF 

No. 331). 

On April 23, 2020, the Court heard oral argument and ordered additional briefing related 

to the RCFC 23(h) notice requirement, supporting invoices, and documents of the Class’s 

consulting experts. These issues also prompted the filing of supplemental documentation by the 

Class on April 30, 2020 at the direction of the Court. (See Supp. Decl. of Ira Lechner, ECF No. 

340). Thereafter, the United States and the Class submitted their final memoranda regarding the 

issue of attorneys’ fees and expenses on May 18, 2020 and May 26, 2020, respectively. (Def.’s 

Resp. to Pl.’s Submission, ECF No. 344; Pl.’s Reply in Supp. of Submission, ECF No. 345). 

Additional facts will be developed as required. 

II. Analysis

The Court begins by examining its own provisions for the recovery of attorney’s fees and 

expenses in class actions, as well as the specific sums sought by the Class, before turning to the 

substance of recovery pursuant to EAJA.

A. Procedure for Recovery of Attorney Fees.

RCFC 23 sets forth the procedure for class actions in the Claims Court. Subsection (h) 

authorizes an application for reasonable attorney’s fees and nontaxable costs if certain 

requirements are met: 

(h) Attorney’s Fees and Nontaxable Costs. In a certified class action, the 

court may award reasonable attorney’s fees and nontaxable costs that are 

authorized by law or by the parties’ agreement. The following procedures 

apply:

(1) A claim for an award must be made by motion under RCFC 54(d)(2), 

subject to the provisions of this subdivision (h), at a time the court sets. 

Notice of the motion must be served on all parties and, for motions by 

class counsel, directed to class members in a reasonable manner.

(2) A class member, or party from whom payment is sought, may object 

to the motion.

(3) The court may hold a hearing and must find the facts and state its 

legal conclusions under RCFC 52(a).

RCFC 23(h). Despite reciting these plainly worded provisions, (Pl.’s Brief at 6), Class counsel 

did not provide notice of the motion to class members as RCFC 23(h)(1) requires. Depending on 

 5 The filing of the second motion seeking attorney fees and costs mooted the Class’s initial 

motion. (ECF No. 304).
4

the nature of a fee request, as discussed below, literal compliance with the notice requirement of 

the rule can be significant.

i. Class Counsel Did Not Provide the Required Notice to the Class.

Class counsel did not provide notice to members of the Class prior to filing the motion 

seeking an award of attorney’s fees and expenses pursuant to § 2412(b) and (d). The text of 

RCFC 23 requires, without exception, notice be given to class members in order to file a motion 

for fees and expenses. See Greenwood v. United States, 131 Fed. Cl. 231, 243–44 (2017) 

(Advisory committee notes to analogous Fed. R. Civ. P. 23(h)(1) require “notice . . . in all 

instances.”). Specifically, RCFC 23(h)(1) requires the class members be given “[n]otice of the 

motion” for a fee award; generalized notice of class counsel’s proposed compensation 

arrangement is insufficient. See RCFC 23(h)(1) (emphasis added). A boilerplate summary 

regarding payment of class counsel, years following settlement of the claim, and nearly a decade 

prior to the motion provided for by RCFC 23(h), is not sufficient.6

Usually, notice to class members will accompany the notice of a proposed settlement 

agreement. See Fed. R. Civ. P. 23(h) advisory committee’s note (2003) (“When a settlement is 

proposed for Rule 23(e) approval, either after certification or with a request for certification, 

notice to class members about class counsel's fee motion would ordinarily accompany the notice 

to the class about the settlement proposal itself.”); Greenwood, 131 Fed. Cl. at 244 (notice 

regarding proposed settlement which “expressly discussed plaintiffs’ motion for attorneys’ fees 

and costs” was sufficient). Notice provided in this manner allows class members the opportunity 

to object or comment on the motion for attorney’s fees and costs in writing and at the fairness 

hearing. Id. at 244. 

The settlement did not include terms related to the payment of attorney’s fees and 

expenses. (See Settl. Agr. at ¶ 10, ECF No. 285-1 (specifically reserving issue of “attorney fees 

and expenses.”)). While the notice of the settlement, posted on the Class website in early or mid2017, specifically stated that the Court denied “payment of interest and attorney fees/expenses 

under the Back Pay Act[,]” it did not reference payment of attorney’s fees and expenses pursuant 

 6 Following the certification of the Class on November 5, 2010 (Order Approv. Class Cert., ECF 

164), the following appeared on the Class website:

If Class Counsel succeeds in recovering money for the Class, he will ask the 

Court for his fees and expenses. You will not have to pay these fees and 

expenses. If the Court grants Class Counsel’s request, the fees and expenses 

would either be deducted from any money obtained for the Class, and/or paid 

separately by the United States. If the Class Counsel’s fees and expenses are 

paid out of the money obtained for the Class, there will be a reduction in the 

amount available for distribution to Class Members, and it may reduce the 

amount of money you may be awarded. If there is no recovery in this case, 

you will not be required to pay any attorneys’ fees or costs to Class Counsel, 

and if there is a recovery of money for the class in this case, you will NOT 

be asked to pay Class Counsel directly his fees and “out-of-pocket” costs.
5

to EAJA. (See Not. of Website Info., ECF No. 340-7).7 Nor could it. Class counsel’s motion 

followed years later. (See Pl.’s Brief (filed Jan. 13, 2020)).

ii. Failure to Provide Notice was Harmless.

No cases discuss the effect of the failure to provide notice required by RCFC 23(h)(1).

Based on the purposes of RCFC 23(h), the importance of the notice requirement is dependent on 

the nature of the fee request. A motion for attorney’s fees and expenses under the “common 

fund” doctrine, discussed below, is particularly significant for the Class.8 An award under the 

“common fund” exception to the American Rule must be paid from the common fund of 

damages awarded to the class, thereby directly impacting the compensation payable to each 

Class member. Because fees are paid from the common fund, the relationship between class 

counsel and the Class transforms from a union of counsel and client aligned in advancing the 

client’s interests, to both client and counsel competing for compensation from the limited funds 

in the common fund. 

As some courts have noted in common fund cases, the relationship between clients and 

counsel is adversarial in the fees context. See In re Washington Pub. Power Supply Sys. Sec. 

Litig., 19 F.3d 1291, 1302 (9th Cir. 1994). This conflict over limited resources may also raise 

constitutional concerns: “[T]he fact that Rule 23 requires settlement and fee notice follows from 

the fact that these decisions are each likely to deprive the plaintiff of property . . ..” Herbert B. 

Newberg, 6 Newberg on Class Actions § 18:43 (5th ed.) (notes eliminated). The deprivation of 

funds awarded to the Class “[triggers] a constitutional right to notice.” Id. Without notice of 

counsel’s efforts to be compensated from a common fund, Class members stand to lose some 

percentage of recovery, achieved after decades of litigation, without being made aware of their 

right to object. This result would hardly be comparable to the hypothetical “excellent result” 

justifying a fully compensable fee discussed in Hensley v. Eckerhart, 461 U.S. 424, 435 (1983). 

(See Pl.’s Reply in Supp. of Subm. at 9). 

This tension between counsel and Class members, both competing for the same common 

fund, mandates strict compliance with the notice provision of RCFC 23(h) when a fee petition is 

brought under the common fund exception permitted by § 2412(b). Such notice enables 

“potential objectors to examine the motion” and state objections to the reasonableness of the fees 

and expenses sought. Cf. Fed. R. Civ. P. 23 advisory committee’s note (2003). Without notice, 

common fund beneficiaries who may challenge the reasonableness of the award have no 

meaningful opportunity to be heard. Even setting aside the other flaws with the Class’s petition 

 7 The exact date notice of the settlement appeared on the website could not be discerned from the 

record. On June 28, 2017, however, the Court noted that notice had previously been posted on 

the website. (Order Appr. of Settl. Agr. at 5, ECF No. 294). 

8 Class counsel takes the position that the notice requirement set forth in RCFC 23(h) does not 

apply to this action: “[I]t was procedurally unnecessary to post on the website the motion by 

Plaintiffs to award attorney fees and expenses . . ..” (Decl. of Ira Lechner at 3). The Court 

respectfully disagrees with Class counsel’s broad assertion. Moreover, Class counsel’s current 

position, first advanced in briefing filed April 30, 2020, contrasts with Class counsel’s earlier 

representation during oral argument: “So I believe that that notice occurred on the website and I 

– I hope it did, put it that way.” (Or. Arg. Trans. at 11, ECF No. 343).
6

for fees under the common fund doctrine, Class counsel’s failure to give notice to the class 

members prevents recovery under that theory. 

Notice of a motion for payment of attorney’s fees and expenses pursuant to § 2412(d) has 

distinct and less meaningful considerations because the fees and expenses are recovered directly 

from the losing party. Most importantly, a court’s award of fees and expenses under § 2412(d)

does not reduce the sums available to Class members. There is no “adversarial” tension between 

counsel and Class members and no constitutional implications from failure to provide notice. 

Because of this crucial distinction, the failure to provide notice of Class counsel’s motion for 

attorney’s fees and expenses pursuant to RCFC 23(h) in this instance is harmless. See RCFC 61 

(“At every stage of the proceeding, the court must disregard all errors and defects that do not 

affect any party’s substantial rights.”). Moreover, because the Court denies recovery of 

attorney’s fees pursuant to § 2412(d), as explained below, the failure to provide notice is 

irrelevant. 

B. Recovery Under the Equal Access to Justice Act (EAJA).

The Court turns now to the substance of the EAJA claim. The Class seeks attorney fees 

and expenses under subsection (b) and/or (d) of EAJA. (Pl.’s Brief at 4). The United States 

counters that the Class is not entitled to an award of attorney fees under either subsection (b) or 

(d), but even if the class is entitled to award of fees and expenses, the sums sought by the Class 

should be significantly reduced. (Def.’s Resp. at 1–2). Before addressing the parties’ respective 

arguments in detail, additional context is required. 

“Congress enacted EAJA . . . in 1980 ‘to eliminate the barriers that prohibit small 

businesses and individuals from securing vindication of their rights in civil actions and 

administrative proceedings brought by or against the Federal Government.’” Scarborough v. 

Principi, 541 U.S. 401, 406 (2004) (quoting H.R. Rep. No. 96–1005, at 9 (1980)). One of the 

main reforms of EAJA was the amendment of § 2412 to allow parties who prevailed in civil 

litigation against the United States to recover awards of attorney’s fees and expenses; awards that 

were previously unavailable under the statute. Id. “EAJA added two new prescriptions to § 2412 

that expressly authorize attorney’s fee awards” in addition to costs. Id.

Subsection (b) “made the United States liable for attorney’s fees and expenses ‘to the 

extent that any other party would be liable under the common law or under the terms of any 

statute which specifically provides for such an award.’” Id. (quoting § 2412(b)). Subsection (d) 

“rendered the Government liable for a prevailing party’s attorney’s fees and expenses in cases in 

which suit would lie only against the United States or an agency of the United States.” Id. at 

406–07. Though similar in goal, these two provisions have different requirements. See Hyatt v. 

Shalala, 6 F.3d 250, 255 (4th Cir. 1993) (noting that the distinctions between the two sections of 

EAJA are of “considerable consequence” in the calculation of fees).

As explained below, the Court finds no basis for awarding fees under Subsection (b) of 

EAJA. Furthermore, because the Court finds the Class’s EAJA application contains various 

defects, and the position of the United States was “substantially justified,” the Court also rejects 

the Class’s petition for costs and fees under Subsection (d). 
7

i. The Class is Not Entitled to Award of Fees or Expenses Under 28 U.S.C. § 

2412(b).

The Class argues it is entitled to attorney’s fees and expenses under Subsection (b) 

because it satisfies one or more common law exceptions to the “American Rule,” which 

disfavors fee-shifting. (Pl.’s Brief at 18). The United States responds that the creation of a 

common fund does not shift the costs of litigation to the losing party, therefore the Class is not 

entitled to an additional award to the common fund to cover fees and costs. (Def.’s Resp. at 8–9). 

Further, the United States argues that the Class has failed to show that the United States 

committed any act in bad faith. (Id. at 10). Thus, the United States concludes that neither 

recognized common law exception to the “American Rule” is implicated here, and consequently, 

the Class is not entitled to fees or expenses under § 2412(b). As explained below, the Court 

agrees with the United States that the Class is not entitled to any award under § 2412(b).

To determine whether § 2412(b) allows the Class to recover additional fees, the Court 

must first look to the statute. Consumer Prod. Safety Comm’n v. GTE Sylvania, 447 U.S. 102, 

109 (1980) (“[T]he starting point for interpreting a statute is the language of the statute itself.”). 

Section 2412(b) provides:

Unless expressly prohibited by statute, a court may award reasonable fees 

and expenses of attorneys, in addition to the costs which may be awarded 

pursuant to subsection (a), to the prevailing party in any civil action brought 

by or against the United States or any agency or any official of the United 

States acting in his or her official capacity in any court having jurisdiction of 

such action. The United States shall be liable for such fees and expenses to 

the same extent that any other party would be liable under the common law

or under the terms of any statute which specifically provides for such an 

award.

(emphasis added).

This statutory formulation contemplates common law exceptions to the “American Rule,” 

the idea that generally each party bears its own expenses. See generally Alyeska Pipeline Service 

Co. v. Wilderness Society, 421 U.S. 240, 247–60 (1975) (describing the history of the “American 

Rule” and statutes that maintain recognized common law exceptions); see also Hardt v. Reliance 

Standard Life Ins. Co., 560 U.S. 242, 251–53 (2010). Common law exceptions recognized by 

Congress in drafting this statute included the “common fund” and “bad faith” exceptions. 

Gavette v. Office of Pers. Mgmt., 808 F.2d 1456, 1460 (Fed. Cir. 1986) (quoting H.R. No. 96-

1418 at 17). The Court agrees with the United States that neither common law exception permits 

the Class to recover fees or expenses in this case. 

1. The Common Fund Exception Does Not Permit Recovery. 

The “common fund” exception to the American Rule is rooted in traditional notions of 

equity and derives from the equitable power of the courts under the doctrines of quantum meruit

and unjust enrichment. Haggart v. Woodley, 809 F.3d 1336, 1352 (Fed. Cir. 2016) (citing 

Central R.R. & Banking Co. v. Pettus, 113 U.S. 116, 128 (1885) and Trustees v. Greenough, 105 

U.S. 527, 532 (1881)). Under the common fund doctrine, “a lawyer who recovers a common 

fund for the benefit of persons other than himself or his client is entitled to [reasonable attorney’s 
8

fees] from the fund as a whole.” Boeing Co. v. Van Gemert, 444 U.S. 472, 478 (1980). A 

common fund exists “when each member of a certified class has an undisputed and 

mathematically ascertainable claim to part of a lump-sum judgment recovered on his behalf.” Id. 

at 479. The United States expressly concedes that a “‘common fund’ [in the amount of 

$637,347.37] exists in this case.” (Def.’s Resp. at 9). 

While acknowledging the existence of a “common fund,” the United States correctly 

points out that attorney’s fees and expenses may only be recovered from the fund; the exception 

does not permit an additional award to the fund earmarked for fees and expenses. (Id. at 8 (citing 

Knight v. United States, 982 F.2d 1573, 1579 (Fed. Cir. 1993) (“The common fund theory does 

not impose additional liability on the losing defendant.”)). Furthermore, the existence of a 

common fund does not automatically establish that attorney’s fees and expenses are recoverable 

from that fund. Haggart, 809 F.3d at 1356 (“[T]he fact that a common fund has been created 

does not mean that the common fund doctrine must be applied in awarding attorney’s fees.”). 

Recovery is limited to those situations where an inequity is borne by counsel or the litigant. 

Haggart, 809 F.3d at 1357 (“The sine qua non of the common fund doctrine is that some 

inequity must exist.”). In a class action, such inequity exists where some opt-in plaintiffs are not 

contractually obligated to contribute to the costs of the litigation because they have not entered 

separate fee agreements with class counsel. Id. at 1354; see also Kane County, Utah v. United 

States, 145 Fed. Cl. 15, 18 (2019) (citing Haggart). At oral argument, Class counsel represented 

there are no contingency fee arrangements with members of the class. (Or. Arg. Trans. at 13, 

ECF No. 343). Therefore, inequity arises from Class counsel’s representation from the inception 

of litigation to its conclusion, and the advancement of litigation expenses by Class counsel. 

However, the common fund has been disbursed to the class members. (Order Permitting 

Disb., ECF No. 323). The Class now seeks an additional award to the common fund earmarked 

for fees and expenses. (Pl.’s Brief at 49, (stating that the Class is “entitled to an award to be paid 

by defendant of an attorney’s fee . . . to be paid to the Common Fund”) (emphasis added)). This

request misapprehends the purpose of the common fund exception. See Haggart, 809 F.3d at 

1352. Counsel eschews payment of fees and expenses from the common fund. (Or. Arg. Trans. at 

53–54). Because of the sums involved, if the common fund doctrine applied it would “result in 

the Plaintiffs getting absolutely nothing.” (Id.). This the Court would not approve. Given that an 

award of attorney fees under the common fund doctrine cannot be an additional award but must 

instead be paid from the common fund, the relief sought by counsel is unavailable. 

2. The Bad Faith Exception Does Not Permit Recovery.

The Class argues that the United States’ conduct amounts to bad faith, such that an 

exception to the American Rule permits recovery of attorney’s fees and expenses under § 

2412(b). (Pl.’s Brief at 33–34). In support of its assertion of bad faith, the Class contends that the 

United States refused to “do the right thing” and consistently and aggressively resisted its “fiscal 

responsibility.” (Id. at 36–37). The Class argues that the resulting twenty-three-and-one-half year 

delay from the accrual of the underlying claims subjects the United States to a finding of bad 

faith thus justifying application of that exception to the American Rule. (Id. at 32–43). The 

United States counters that the Class’s “bad faith” argument relies on an erroneous assertion of 

meritlessness. (Def.’s Resp. at 12). Specifically, the United States points out that the Class 

improperly seeks § 2412(b) recovery based on prelitigation conduct and cannot demonstrate any 
9

litigation activity conducted in bad faith. (Id. at 13–14). The Court agrees with the United States 

that the bad faith exception does not apply. 

The “bad faith” exception to the American Rule arises from the inherent powers of courts 

“to manage their own affairs to achieve the orderly and expeditious disposition of cases.” 

Chambers v. NASCO, Inc., 501 U.S. 32, 43 (1991) (quoting Link v. Wabash R. Co., 370 U.S. 

626, 630–631 (1962)). “[A] court may assess attorney’s fees when a party has ‘acted in bad faith, 

vexatiously, wantonly, or for oppressive reasons.’” Chambers, 501 U.S. at 45–46 (quoting 

Alyeska Pipeline Serv. Co., 421 U.S. at 258–59). The bad faith exception applies to a full range 

of litigation abuses and depends not on which party wins, but on the parties’ conduct during the 

litigation. Id. at 53. Consequently, because the focus is on litigation conduct, “fee awards cannot 

be assessed based on claims of bad faith primary conduct[,]” i.e. conduct of a party prior to 

litigation. Centex Corp. v. United States, 486 F.3d 1369, 1371–72 (Fed. Cir. 2007) (citing eight 

other circuits articulating a similar standard). To the extent that the Class invites the Court to 

consider the conduct of the VA prior to litigation, (Pl.’s Brief. at 37), the Court is unwilling to do 

so.

Though the Class consistently complains of the duration of this litigation, a cursory 

review of the prior proceedings demonstrates that both parties routinely sought enlargements of 

time which contributed to delay.9 Other factors which contribute to delay, such as the duration of 

an appeal or other circumstances uniquely within the control of the courts, are neutral and should 

afford no adverse inference against either party. In addition, though the Class originally asserted 

claims relating to the cost of living adjustments (COLA), locality pay adjustments, Sunday 

premium pay, evening and weekend pay, and prejudgment interest, the United States prevailed 

on the bulk of these claims in this Court and on appeal, but only after more than a decade of 

litigation. See generally, Athey V, 908 F.3d 696 (discussing the extensive litigation history of this 

dispute). Considering the complete record, an exercise of the Court’s inherent powers is 

unwarranted. Nothing within the record suggests bad faith on the part of the United States after 

litigation commenced.

ii. The Class is Not Entitled to Award of Fees or Expenses Under 28 U.S.C. § 

2412(d).

A prevailing party may be entitled to attorney’s fees and expenses under § 2412(d) where 

the position of the United States was not “substantially justified” and no special circumstances 

are present which would make such an award unjust. These conditions may be found in § 

2412(d)(1)(A) and (d)(1)(B), which provide:

 9 By the Court’s reckoning, the parties sought enlargements of time no less than 35 times. Of 

these, the United States sought 25 while the Class sought nine. (See ECF Nos. 3, 18, 20, 27, 36, 

52, 57, 66, 70, 75, 79, 85, 87, 89, 119, 136, 168, 172, 201, 215, 219, 221, 223, 225, 268, 271, 

273, 275, 277, 279, 281, 293, 308, 327, 329). Moreover, on one occasion, the Court imposed a 

stay of proceedings following a requested enlargement of time to pursue settlement of the 

attorney fees dispute. (ECF No. 309; Order Lifting Stay, ECF No. 322). Significantly, the Class 

opposed only a single request for delay. (See ECF 119). While this history indicates a significant 

degree of collegiality, it does not support a notion of unfair prejudice arising from vexatious 

delaying tactics.
10

(d)(1)(A) Except as otherwise specifically provided by statute, a court shall 

award to a prevailing party other than the United States fees and other 

expenses, in addition to any costs awarded pursuant to subsection (a), 

incurred by that party in any civil action (other than cases sounding in tort), 

including proceedings for judicial review of agency action, brought by or 

against the United States in any court having jurisdiction of that action, unless 

the court finds that the position of the United States was substantially justified 

or that special circumstances make an award unjust.

(B) A party seeking an award of fees and other expenses shall, within thirty 

days of final judgment in the action, submit to the court an application for 

fees and other expenses which shows that the party is a prevailing party and 

is eligible to receive an award under this subsection, and the amount sought, 

including an itemized statement from any attorney or expert witness 

representing or appearing in behalf of the party stating the actual time 

expended and the rate at which fees and other expenses were computed. The 

party shall also allege that the position of the United States was not 

substantially justified. Whether or not the position of the United States was 

substantially justified shall be determined on the basis of the record 

(including the record with respect to the action or failure to act by the agency 

upon which the civil action is based) which is made in the civil action for 

which fees and other expenses are sought.

Stated differently, recovery of an award under the statute has five requirements, neatly 

summarized in WHR Grp., Inc. v. United States, 121 Fed. Cl. 673, 676 (2015):

(1) the fee application must be submitted within 30 days of final judgment 

in the action and be supported by an itemized statement; (2) at the time the 

civil action was initiated, the applicant, if a corporation, must not have been 

valued at more than [the applicable] net worth [threshold] or employed more 

than 500 employees; (3) the applicant must have been the “prevailing party” 

in a civil action brought by or against the United States; (4) the Government's 

position must not have been “substantially justified;” and (5) there cannot 

exist any special circumstances that would make an award unjust.

The burden is on the fee petitioner to satisfy the first three requirements, then the burden shifts to 

the United States to show its position was “substantially justified” or that special circumstances 

make an award unjust. See Impresa Construzioni Geom. Domenico Garufi v. United States, 100 

Fed. Cl. 750, 759 (2011) and Helfer v. West, 174 F.3d 1332, 1336 (Fed. Cir. 1999). 

In its fee application, the Class commits multiple errors which ultimately preclude 

recovery under § 2412(d). For example, the Class has failed to affirmatively plead its members 

satisfy the net worth requirement. While acknowledging this defect, the United States declines to 

contest the eligibility of any class member under the net worth requirement. (Def.’s Resp. at 20–

21). Instead, the United States argues that the Class is ineligible for award under § 2412(d) 

because: (1) the United States’ position was substantially justified; (2) the Class has failed to 

submit a contemporaneous itemized statement; and (3) the Class is the “prevailing party” on only 

a narrow issue. (Id. at 21). Though counsel would ordinarily be permitted an opportunity to 

rectify its failure to provide contemporaneous records, as explained below, the Court finds the 
11

position of the United States was substantially justified, thus there is no need for additional 

filings.

1. The Position of the United States was Substantially Justified.

Even if the Class had properly pleaded that its members met the net worth requirements, 

properly submitted contemporaneous itemized records supporting its fee application, and given 

proper notice to the class members, the United States has demonstrated its position was 

substantially justified. Thus, the Class’s fee petition must fail. 

The “position” of the United States “refers to the government’s position throughout the 

dispute, including not only its litigating position but also the agency’s administrative position.” 

Doty v. United States, 71 F.3d 384, 386 (Fed. Cir. 1995), as modified, 109 F.3d 746 (Fed. Cir. 

1997). “[T]rial courts are instructed to look at the entirety of the government’s conduct and make 

a judgment call whether the government’s overall position had a reasonable basis in both law and 

fact.” Chiu v. United States, 948 F.2d 711, 715 (Fed. Cir. 1991). This judgment call is 

“quintessentially discretionary in nature” and courts “must be wary not to redistribute these 

weights among different positions unless a serious error in judgment has been made.” Id. at 715 

n.4. So long as the United States has offered a “plausible defense, explanation, or substantiation 

for its action[,]” fee awards under EAJA should be denied. See Griffin & Dickson v. United 

States, 21 Cl. Ct. 1, 6–7 (1990). 

Whether the position of the United States was “substantially justified” is not determined

solely by who won and lost on the merits. See Pierce, 487 U.S. at 569 (“Conceivably, the 

Government could take a position that is not substantially justified, yet win; even more likely, it 

could take a position that is substantially justified, yet lose.”). To avoid liability for an EAJA fee 

award under § 2412(d), the United States’ position must merely be “justified to a degree that 

could satisfy a reasonable person.” Id. at 565.10 Although the Class summarily alleges the 

position of the United States was not substantially justified, (Pl.’s Mot. at 2), the Class did not 

point the Court to the conduct that it might consider making that determination.11

Throughout its briefing, the Class’s primary complaints about the position of the United 

States seem to focus on (1) the delay in obtaining relief for class members and (2) the failure of 

the United States to correct the procedures which led to class members failing to receive 

compensation to which they were entitled. (See Pl.’s Brief). In addition to providing plausible 

explanations or defenses to these criticisms, the United States submits that its “string of 

successes” weighs heavily in favor of finding substantial justification for its position. (See Def.’s 

Resp. at 25). 

 10 There is, however, an alternative view. Procopio v. Wilkie, No. 2017-1821, 2019 WL 

8641304, at *1 (Fed. Cir. Sept. 25, 2019), cert. denied, No. 19-819, 2020 WL 2105225 (U.S. 

May 4, 2020) (O’Malley, J. concurring) (Arguing for “a standard that recognizes that the 

statutory language [of EAJA] requires something more than reasonableness.”).

11 During Oral Argument, the Court specifically requested Class counsel to offer records cites to 

support its position. (Or. Arg. Trans. at 15–17). In response, the Court received little more than a 

general recitation of the procedural history of the case.
12

First, as the Court previously noted, (supra at n.9), the parties jointly agreed or 

acquiesced to numerous enlargements of time in this case. Litigation was also briefly stayed 

following a renewed attempt to extend existing deadlines. (ECF No. 309). The Class was entitled 

to voice objections or frustrations at any time yet chose not to, acquiescing to the sometimestorpid pace of litigation. The Court sees no reason why agreed-upon delays, or other neutral 

factors affecting the progress of this case, should prejudice the United States. 

Second, the Class admits that, prior to this lawsuit, the VA’s failure to properly 

compensate the class members “could be fairly attributed to an innocent mistake of process 

within an extraordinarily large governmental institution.”12 (Pl.’s Brief at 34). The Class 

contends that this “innocent mistake” should have been rectified once highlighted by federal 

litigation. (Id.). But, importantly, the United States did attempt to rectify this mistake. In 2011, 

the United States explained to the Court that in 2006, the VA began the process of migrating its 

payroll systems to a new system, and during that process, it “examined the [new] system to 

ensure it was properly paying separated VA employees their accrued and accumulated lump-sum 

annual leave payments[.]” (ECF No. 176 at 2–3). During this examination, the United States 

“discovered that some of the VA employees who had been paid through the [new system] may 

not have been paid their supplemental payment” and “approached plaintiffs’ counsel to 

determine if VA could, with the approval of the court, pay those employees their supplemental 

payment” but “[p]laintiffs’ counsel declined the offer.” (Id. at 3). In this regard, plaintiffs’ 

counsel resisted the United States’ efforts to resolve this dispute by “pay[ing] those employees 

and remov[ing] them from the class.” (See id.). In its reply brief, the Class makes no attempt to 

rebut or explain these efforts by the United States. (See ECF No. 331). These attempts by the 

United States would surely satisfy a reasonable person that the VA was endeavoring to make its 

employees whole. But for the reticence of Class’s counsel, many VA employees may have 

received compensation nearly a decade ago.

Finally, the United States establishes that its string of successes indicates its litigation 

posture was substantially justified. Although success or failure on the merits is not always 

determinative, in cases such as this one involving multiple issues and decisions, “a string of 

losses can be indicative; and even more so a string of successes.” Pierce, 487 U.S. at 569. The 

United States prevailed on multiple key issues, including whether night premium pay, weekend 

additional pay, and Sunday pay after October 1, 1997 should be included in class members’ back 

 12 Even the Class’s expert, a career VA employee in human resources, agrees that prior to the 

implementation of the new system, VA policy was to promptly correct lump sum payment 

errors:

Whenever we discovered that someone was not being paid correctly, we 

immediately corrected the error and informed payroll to process any 

retroactive pay adjustments. In such circumstances, I never sought 

permission from senior leadership even in cases where the correction covered 

multiple employees because I understood that my action was in line with 

official policy at the agency to correct such payment errors retroactively.

(Aff. of D. Kowalski at 3, ECF No. 324-5) (emphasis added). While this method was certainly 

was not optimal, it does indicate that the United States was at least somewhat responsive to its 

statutory obligations.
13

lump-sum pay. Athey I, 78 Fed. Cl. 157. The United States also prevailed on whether nonGeneral Schedule employees should be included in the class. (ECF No. 42). And the United 

States prevailed on the issue of class members’ entitlement pre-judgment interest under the Back 

Pay Act. (ECF No. 242). This drumbeat of favorable decisions for the United States on multiple 

key issues, both in the trial court and on appeal, strongly indicates the United States’ position 

was “justified to a degree that could satisfy a reasonable person.” See Pierce, 487 U.S. at 569. It 

would be difficult to acknowledge this record of successes in both the trial court and the Federal 

Circuit but conclude the “overall position” of the United States did not have a “reasonable basis” 

in law and fact. See Chiu, 948 F.2d at 715. Therefore, the Court finds that the position of the 

United States was “substantially justified” under § 2412(d). Consequently, the Class is not 

entitled to recover fees and expenses under EAJA.

2. The Class Failed to Submit a Contemporaneous Itemized Statement.

In addition to the position of the United States being substantially justified, the Class has 

failed to submit contemporaneous itemized statements, a prerequisite to recovery under EAJA. 

The Federal Circuit has unequivocally held that a party seeking fees and expenses under EAJA 

must submit contemporaneous records to support the sums it seeks to recover. Naporano Iron & 

Metal Co. v. United States, 825 F.2d 403, 404 (Fed. Cir. 1987). 

The court needs contemporaneous records of exact time spent on the case, by 

whom, their status and usual billing rates, as well as a breakdown of expenses 

such as the amounts spent copying documents, telephone bills, mail costs and 

any other expenditures related to the case. In the absence of such an itemized 

statement, the court is unable to determine whether the hours, fees and 

expenses, are reasonable for any individual item. 

Id. (emphasis added). Spreadsheets of time entries and expenses created years after the work was 

performed or the expenses accrued do not suffice. See Prowest Diversified, Inc. v. United States, 

40 Fed. Cl. 879 (1998) (rejecting summary itemization and requiring fee petitioners to submit 

monthly billing records to satisfy documentation component). 

The Class has submitted an itemized statement that fails to satisfy the contemporaneity 

requirement. (See Pl.’s Mot., Ex. 1). The Class’s fee and expense statements submitted appear to 

have been generated solely for the instant fee dispute, unaccompanied by an affidavit or 

otherwise satisfying the contemporaneous requirement, and thus cannot be considered 

“contemporaneous.” (See Pl.’s Mot., Ex. 1; Ex. 2; Ex. 3). Therefore, the Court concludes the 

Class has failed to carry its burden to satisfy the first requirement of § 2412(d). Even so, were it 

not for substantial justification of the United States’ positions, the Class would be permitted to 

supplement the record in order to alleviate this defect. See Forestwood National Bank of Dallas 

v. United States, 852 F.2d 1294 (Fed. Cir. 1988) (stating that trial courts have broad discretion to 

permit amended application in EAJA petition regarding attorney hours expended). However, 

given the Court’s determination that the position of the United States was substantially justified, 

any supplement would be in vain. 

Agreeing with the United States that its position was substantially justified, the Court has 

no choice but to conclude that the Class is not entitled to an award of fees and expenses under § 

2412(d). The Class’s failure to comply with the procedural requirements of EAJA only bolsters 

this conclusion. While the consequences of this result are unquestionably harsh, the 
14

responsibility for satisfying the requirements of EAJA lies solely with the Class. The Court 

enjoys no liberty to cure defects in an EAJA application to avoid a result mandated by law, no 

matter how severe the consequences may be. Fid. Const. Co. v. United States, 700 F.2d 1379, 

1386 (Fed. Cir. 1983) (“Although the EAJA lifts the bar of sovereign immunity for award of fees 

in suits brought by litigants qualifying under the statute, it does so only to the extent explicitly 

and unequivocally provided.”).

3. The Class was the Prevailing Party for the Purposes of § 2412(d).

An EAJA fee petitioner must demonstrate it is the “prevailing party” to shift the burden 

to the United States. A “prevailing party” must show it “receive[d] at least some relief on the 

merits of [its] claim[.]” Hewitt v. Helms, 482 U.S. 755, 760 (1987). A settlement in favor of the 

fee petitioner evinces success on the merits of at least some of its claims. See Maher v. Gagne, 

448 U.S. 122, 129 (1980) (“The fact that respondent prevailed through a settlement rather than 

through litigation does not weaken her claim to fees.”). The key consideration is whether there 

has been a “material alteration of the legal relationship [between] the parties[.]” Texas State 

Teachers Ass’n v. Garland Indep. Sch. Dist., 489 U.S. 782, 792–93 (1989).

The United States concedes the Class prevailed on the issue of General Schedule 

employees’ entitlement to COLA and locality pay adjustments not included in their lump-sum 

payouts. (Def.’s Resp. at 22 (citing Judgment, ECF No. 295)). However, the United States’ 

attempt to frame this win for the Class as “narrow” is unpersuasive. The Class secured a 

settlement in excess of $600,000 for its members, which the Court approved, materially altering 

the parties’ legal relationship. The Class is clearly a “prevailing party” for the purposes of § 

2412(d). That determination, however, does not create a presumption that the Class is entitled to 

recover attorney’s fees. United States v. Hallmark Construction Co., 200 F.3d 1076, 1079 (Fed. 

Cir. 2000) (citing Marcus v. Shalala, 17 F.3d 1033, 1036 (7th Cir. 1994)).

III. Conclusion

For the reasons stated above, the Class’s petition for attorney fees and expenses pursuant 

to EAJA is DENIED. Additionally, the Class’s first motion for attorney’s fees (ECF No. 304) is 

DENIED AS MOOT. The parties are DIRECTED to file a status report on or before August 

20, 2020 describing further proposed proceedings in this case. 

IT IS SO ORDERED.

s/ David A. Tapp

DAVID A. TAPP, Judge