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Bid Protester Allowed to Recover Higher Attorney Fees Based on Consumer Price Index
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May 28, 2007
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Thelen Reid Brown Raysman & Steiner LLP
Inter-Con Security Systems, Inc. protested the Department of State's award of a contract to Wackenhut International, Inc. for guard services in Abidjian, Ivory Coast. The Comptroller General sustained Inter-Con's protest on the grounds that Wackenhut had provided insufficient information and that the State Department lacked sufficient information to establish that Wackenhut satisfied all requirements for application of a 10 percent evaluation preference to its proposal.
As a result, the Comptroller General recommended that Wackenhut's contract be terminated, that the contract be awarded to Inter-Con and that the State Department reimburse Inter-Con its reasonable costs of filing and pursuing the protest, including attorney fees.
Wackenhut and the State Department petitioned for reconsideration, and the Comptroller General affirmed its decision but modified its recommendation to allow the State Department to delay the termination of Wackenhut's contract and the award to Inter-con. The Comptroller General further recommended that Inter-Con be reimbursed for its costs of responding to the State Department's reconsideration request.
Inter-Con subsequently submitted its costs and requested reimbursement of attorney fees at rates between $196.89 and $197.77 an hour. The State Department then sought the Comptroller General's recommendation on the appropriateness of the "enhanced" attorney fees.
The Comptroller General recognized that under the Competition in Contracting Act of 1984, as amended in 2000, when the Comptroller General recommends that a successful protester's costs, including reasonable attorney fees, be reimbursed, those fees may not exceed $150 an hour "unless the agency determines, based on the recommendation of the Comptroller General on a case by case basis, that an increase in the cost of living or a special factor, such as the limited availability of qualified attorneys for the proceedings involved, justifies a higher fee." See, 31 USC §3554 (c)(2)(B) (2000).
Citing to Sodexho Management, Inc. - Costs, Comp. Gen. No. B-289605.3 (Aug. 6, 2003), the Comptroller General noted that the justification for an upward fee adjustment is self-evident if the claimant alleges that the cost of living has increased, as measured by the Department of Labor's Consumer Price Index.
In other words, Inter-Con could request an upward adjustment but was required to present a reasonable basis upon which the adjustment should be calculated. If Inter-Con provided the appropriate justification for the higher fees, the Comptroller General would recommend payment of the "enhanced" fees subject to objection by the State Department.
Inter-Con supported its claimed costs with a detailed explanation of its calculations of rates and by using the "All Urban Consumers" Consumer Price Index for the San Francisco-Oakland-San Jose, California area. The Comptroller General found that Inter-Con's use of the "All Urban Consumers" CPI was consistent with the decision in Sodexho.
The Comptroller General found that Inter-Con's requested fees appeared properly supported and reasonable and recommended that the State Department pay the higher attorney fees along with Inter-Con's additional costs. Matter of Department of State - Costs, Comp. Gen. No. B-295352.5, 2005 WL 1994323 (Aug. 18, 2005). The State Department stated that it intended to pay all costs recommended by the Comptroller General.
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For more information about the issues covered in this report, please contact Paul Berning in our San Francisco office at 415-369-7229 or at pwberning@thelen.com or contact your Thelen attorney. For more information about Thelen's Construction and Government Contracts Department, click here.
©2007 Thelen Reid Brown Raysman & Steiner LLP
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