Court Opinion

ID: 4548218
Source: CourtListenerOpinion
Date Created: 2020-07-14 19:01:36.563381+00
Date Added: 2024-06-11T08:29:16.574990
License: Public Domain

In the United States Court of Federal Claims
                                          No. 17-1763C

                                      (Filed: July 14, 2020)

 **********************************            )
 THE TOLLIVER GROUP, INC.,                     )      Federal contractor’s claim for partial
                                               )      reimbursement of legal fees and costs
                        Plaintiff,             )      incurred in successful defense of qui tam
                                               )      suit; equitable adjustment; reasonableness
        v.                                     )      of fees incurred
                                               )
 UNITED STATES,                                )
                                               )
                        Defendant.             )
                                               )
 **********************************

       Walter Brad English, Maynard, Cooper & Gale, P.C., Huntsville, Alabama, for plaintiff.
With him on the briefs were Emily J. Chancey and Michael W. Rich, Maynard, Cooper & Gale,
P.C., Huntsville, Alabama.

        Ashley Akers, Trial Attorney, Commercial Litigation Branch, Civil Division, United
States Department of Justice, Washington, D.C., for defendant. With her on the briefs were
Joseph H. Hunt, Assistant Attorney General, Civil Division, and Robert E. Kirschman, Jr.,
Director, and Tara K. Hogan, Assistant Director, Commercial Litigation Branch, Civil Division,
United States Department of Justice, Washington, D.C.

                                     OPINION AND ORDER

LETTOW, Senior Judge.

        Plaintiff, The Tolliver Group, Inc. (“Tolliver”), incurred costs in successfully defending a
qui tam suit that implicated its performance of a government contract. The court previously
found defendant (“the government”) liable to Tolliver for part of its costs in defending that suit
but deferred entering judgment to allow the parties an additional opportunity to address the
reasonableness of the fees claimed. See Tolliver Grp., Inc. v. United States, 146 Fed. Cl. 475,
486 (2020); see also Tolliver Grp., Inc. v. United States, 148 Fed. Cl. 351 (2020) (denying
government’s motion for reconsideration). The government has responded with general
objections to any award of fees, see Def.’s Resp. to Pl.’s Request for Attorneys’ Fees and Costs
(“Def.’s Resp.”), ECF No. 58, and Tolliver has filed a reply, see Pl.’s Resp. in Support of Legal
Costs (“Pl.’s Reply”), ECF No. 61. The court must now decide whether the amount of the costs
claimed by Tolliver in defending the qui tam suit is reasonable. Upon consideration of the
supporting evidentiary materials, the court concludes that the costs claimed by Tolliver are
eminently reasonable.

                                        BACKGROUND1

        Tolliver took over performance of a preexisting contract with the United States Army to
produce a series of technical manuals. The Army needed such manuals to provide military field
users with current parts information and updated procedures for provisioning, maintaining, and
overhauling its Hydrema 910 Mine Clearing Vehicle. See Joint Stip. ¶¶ 5-6.2 Anticipating that
preparing the manuals might otherwise necessitate the contractor having to reverse engineer the
mine clearing vehicle, the contract’s Performance Work Statement (“PWS”) required the Army
to provide a technical data package with engineering drawings obtained from the manufacturer
of the vehicle. See Joint Stip. ¶¶ 11-12. Nonetheless, the Army never obtained, and thus never
provided, the technical data package from the manufacturer. Joint Stip. ¶¶ 13-14. Even though
the technical data package had not been, and could not be, provided to the contractor as the
contract required, the Army directed the work to proceed. See Joint Stip. ¶ 15. After Tolliver
began working on the contract—without the technical data package, Joint Stip. ¶ 14—the Army
issued Modification 8, an amendment to the contract that, among other changes, removed the
government’s obligation to provide the technical data package, see Joint Stip. ¶¶ 17-18, but
increased the contractual fee by four and one-half times, see Tolliver, 148 Fed. Cl. at 353.

         The failure to provide the technical data package supplied the basis for the qui tam action.
Tolliver, 148 Fed. Cl. at 353. On April 15, 2014, Robert Searle filed an action against Tolliver
under the False Claims Act, 31 U.S.C. §§ 3729-31, in the United States District Court for the
Eastern District of Virginia, styled United States of America ex rel. Robert C. Searle v. DRS
Technical Services, et al., No. 1:14-cv-00402. Joint Stip. ¶ 19. Mr. Searle asserted that Tolliver
violated the False Claims Act while performing the contract during the period before
Modification 8 became effective by certifying compliance with the technical data package
despite having never received that package, see United States ex rel. Searle v. DRS Tech. Servs.,
No. 1:14-cv-00402, 2015 WL 6691973, at *1 (E.D. Va. Nov. 2, 2015). The government declined
to intervene or to move to dismiss the relator’s case, and Tolliver successfully defended the
litigation. Tolliver, 148 Fed. Cl. at 353. The district court dismissed the complaint, concluding
that it lacked merit because “[the Army] intended to provide [Tolliver] with [the technical data
package] for use in developing the manuals, it did not do so, it knew that it did not do so, and
still instructed [Tolliver] to proceed with performance.” Searle, 2015 WL 6691973, at *1.
Thereafter, the United States Court of Appeals for the Fourth Circuit affirmed the district court’s

       1
         The recitations that follow do not constitute findings of fact by the court. Instead, the
recited factual elements are taken from the parties’ joint stipulation of facts, the complaint,
motions, appended exhibits, and judicial notice of prior relevant decisions in this and other
courts. No factual disputes are involved.

       The stipulations number 27 and will be cited as “Joint Stip.” followed by paragraph
       2

number. See ECF No. 38.
                                                  2
dismissal of the suit. See United States ex rel. Searle v. DRS Tech. Servs., 680 Fed. Appx. 163
(4th Cir. 2017).

        After the affirmance of the dismissal of the qui tam suit, Tolliver submitted a claim to the
contracting officer under the Contract Disputes Act, 41 U.S.C. §§ 7101-09, for an equitable
adjustment, seeking reimbursement of $195,889.78 for allowable legal fees incurred in defending
the suit. See Joint Stip. ¶ 25. The requested amount represented 80 percent of the $244,862.22
in attorneys’ fees that Tolliver said it had incurred in its successful defense of the False Claims
Act suit. Joint Stip. ¶ 26. The contracting officer denied the claim in full, Joint Stip. ¶ 27,
concluding it was precluded by the fixed-price nature of the contract.

        Tolliver then brought its claim before this court. On January 22, 2020, the court ruled
that equitable reimbursement for the defense costs was appropriate because the qui tam suit was
based on Tolliver’s Army-mandated efforts to perform in the absence of the technical data
package. See Tolliver, 146 Fed. Cl. at 483-84. The court denied the government’s subsequent
motion for reconsideration of that decision. See Tolliver, 148 Fed. Cl. at 351. The government
then submitted its objections to the reasonableness of Tolliver’s claimed costs on June 10, 2020,
see Def.’s Resp., and Tolliver filed a reply on June 26, 2020, see Pl.’s Reply.

                              STANDARD FOR DECISION

        The reasonableness of attorneys’ fees is generally assessed by reference to the lodestar
method—“the product of reasonable hours times a reasonable rate”—and there is a “strong
presumption” that the lodestar represents a reasonable fee. Pennsylvania v. Delaware Valley
Citizens’ Council for Clean Air, 478 U.S. 546, 565 (1986). The lodestar method is “[a] widely
accepted mode of determining reasonable attorneys’ fees” which “requires determining both the
reasonable hourly rate and the reasonable number of hours expended on the litigation.” First
Fed. Sav. & Loan Ass’n of Rochester v. United States, 88 Fed. Cl. 572, 587 (2009) (citing
Hensley v. Eckerhart, 461 U.S. 424, 433-34 (1983)) (additional citation omitted). The party
seeking fees “bears the burden of . . . documenting the appropriate hours expended and hourly
rates,” exercising “billing judgment” in doing so, Hensley, 461 U.S. at 437, but that burden is
“routinely satisf[ied]” by the “[s]ubmission of invoices and billing records,” Rumsey v.
Department of Justice, 866 F.3d 1375, 1379 (Fed. Cir. 2017). The court also may refer to
declarations made by other attorneys about the reasonableness of fees in a geographic area and
may likewise rely on its “own expertise to recognize applicable prevailing rates.” Morris v.
Secretary of Dep’t of Health and Human Servs., 20 Cl. Ct. 14, 29 (1990) (citation omitted).

         Here, few, if any, complications arise. The “[f]ees incurred and paid by a client at an
agreed rate are presumptively reasonable because in reaching agreement, lawyer and client have
already considered and weighed all the relevant factors.” Lost Tree Village Corp. v. United
States, 135 Fed. Cl. 92, 96 (2017) (citations and internal quotations omitted); see also Laffey v.
Northwest Airlines, Inc., 746 F.2d 4, 24 (D.C. Cir. 1984) (“[W]hen fixed market rates already
exist, there is no good reason to tolerate the substantial costs of turning every attorneys[’] fee
case into a major ratemaking proceeding. In almost every case, the firms’ established billing
rates will provide fair compensation.”) overruled in part on other grounds by Save Our
Cumberland Mountains, Inc. v. Hodel, 857 F.2d 1516 (D.C. Cir. 1988) (en banc).
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                                           ANALYSIS

         Tolliver seeks to recover $195,889.78, which represents 80 percent of the $244,862.22 it
incurred in its defense of the qui tam suit. See Pl.’s Reply. at 1, 6. In support of that amount,
Tolliver has provided all of its legal invoices concerning the litigation. See generally Pl.’s
Reply, App. at 22-158. Those invoices identify the timekeeper performing each task, describe
the tasks performed, and set forth each timekeeper’s hourly rate and the amount of time
expended. See id. Tolliver also submitted declarations by its attorneys further explaining that
their rates were discounted and labor was carefully divided between its lead counsel and its local
counsel. See, e.g., Pl.’s Mot. for Summary Judgment (“Pl.’s Mot.”), App. at A1060-1062 (Decl.
of W. Brad English, lead counsel), A1101-04 (Decl. of Stephen J. Obermeier, local counsel),
ECF No. 41.3 Additionally, Tolliver produced declarations of two other attorneys opining on the
prudence of the billing judgment and staffing decisions made. See Pl.’s Reply, App. at 4-14
(Decls. of Mark J. Linderman and G. Bartley Loftin, III).

        Agreed rates are “presumptively reasonable” because such rates reflect the considered—
presumably reasonable—decisions of both the lawyer and client, when those rates have been
actually paid, as here. See Lost Tree Village Corp., 135 Fed. Cl. at 96. Beyond a detailed
accounting of those agreed rates and explanations of the hours expended, Tolliver has produced
substantial evidentiary material supporting the fees at issue here. The declarations of other
attorneys concur that “the work performed by the firms was necessary to defend Tolliver against
the plaintiff’s various allegations” and “the rates charged . . . were reasonable and well within the
range of prevailing rates charged in the D.C. metro area, including Alexandria, Virginia, during
that timeframe.” Pl.’s Reply, App. at 7 (Linderman). Furthermore, the firms Tolliver engaged
substantially discounted their rates, “appl[ying] discounts and write offs to account for any
potential duplication” between them. Id. at 7. Indeed, the court’s own experience is consistent
with these declarations, finding these rates eminently reasonable. See Morris, 20 Cl. Ct. at 29
(citation omitted) (noting that a court may rely on its “own expertise to recognize applicable
prevailing rates”).

        Moreover, even after reviewing the documentation provided by Tolliver, the government
makes no detailed objection to either the billing rates or the total sum, presenting no additional
evidentiary material or even contrary declarations to rebut Tolliver’s documentation. Instead, the
government simply disregards Tolliver’s evidentiary submissions, contending that it is “not in a
position to object or agree to the reasonableness of Tolliver’s claimed attorneys’ fees because
Tolliver has not put forth any evidence sufficient to meet its burden to demonstrate the
reasonableness of its costs.” Def.’s Resp. at 1. That assertion is belied by the extensive
evidentiary material in the record which the government declines even to address.

       3
         Lead counsel for Tolliver, Mr. English, regularly applied a discount to his normal billing
rate, see, e.g., Pl.’s Mot. App. at A1066, A1072, effectively charging no more than
approximately $340 per hour in 2015 and 2016 when the great bulk of the work was done, id. at
A1081, A1173, A1362. Local counsel, Wiley Rein, similarly applied billing discipline, with the
lead local counsel, Mr. Obermeier, charging $540 to $585 per hour. See generally Pl.’s Reply,
App. at 95-158 (Attach. 2). Most of Mr. Obermeier’s time was billed at $540 per hour. Id.
                                                 4
        The government also maintains that some of the costs Tolliver seeks were incurred to
defend claims subsumed in the qui tam suit that had no predicate in the Army’s failure to provide
the technical data package. See Def.’s Resp. at 3-4. Thus, the government asserts, “[r]easonable
attorney fees should not include the fees associated with defending the other six counts of the
suit, none of which involved the technical data package.” Id. This contention is not new.
Indeed, the court already considered a similar argument and concluded—relying on prior
findings of the district court in the qui tam case—that “the absence of the technical data package
triggered and served as the basis for the qui tam suit” and therefore “[i]f the missing data had
been provided, the qui tam suit could not have been brought.” Tolliver, 146 Fed. Cl. at 484. The
government’s contention ignores the central thrust of the qui tam suit and has no meaningful
bearing on the reasonableness of the fees at issue.

                                         CONCLUSION

      For the reasons stated, the court finds Tolliver’s claimed legal costs to be reasonable.
Accordingly, Tolliver is awarded the sum of $195,889.78. The clerk is directed to enter final
judgment in accord with this disposition.

       Tolliver is awarded its costs of suit.

       It is so ORDERED.

                                                    s/ Charles F. Lettow
                                                    Charles F. Lettow
                                                    Senior Judge

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