PHOTO DATA, INC.,


                     Danford SAWYER, et al.,

                           No. 81-2435

533 F. Supp. 348

Gilbert J. Ginsburg, Jean Galloway, Donald S. Picard, Washington,
D. C., for plaintiff.

Sp. Asst. U. S. Atty., Dayton Lehman, Jr., Dept. of Justice,
Washington, D. C., for defendants.

                       MEMORANDUM OPINION

This case comes before the Court on plaintiff's Application for
Attorneys' Fees pursuant to Section 204(a) of the Equal Access to
Justice Act (Act), 28 U.S.C.  2412. Plaintiff seeks
reimbursement from the United States for attorneys' fees and
other litigation costs incurred during the period of September
30, 1981 through November 16, 1981, in connection with its
Complaint for declaratory and injunctive relief and this


On or about June 23, 1981, plaintiff received an invitation from
the Government Printing Office (GPO) to bid for, inter alia, the
printing and distribution of the Federal Personnel Manual.  The
solicitation provided that the contract would be awarded to the
lowest responsible bidder, with responsibility determined by a
pre-award survey of the applicant's ability to perform the

Although plaintiff submitted the lowest bid it was not awarded
the contract due to a nonresponsibility finding made by the
Contracting Officer, William L. Jackson, on September 30, 1981.
His reasoning was as follows:

This determination was made because of the submission of
improperly coded FIDE tapes on the previous 255-S contract and as
a result of an unfavorable Pre-Award Survey conducted at your
plant on September 22, 1981. 1

The contract was awarded to the next low bidder.

Plaintiff filed a written protest of the nonresponsibility
determination on October 1, 1981, requesting that performance of
the contract be stayed pending a Small Business Administration
review of the GPO's finding.  Thereafter, on October 2, 1981,
plaintiff filed, in this Court, a Complaint for declaratory and
injunctive relief, an application for a temporary restraining
order, and a motion for preliminary injunction.

Immediately prior to a hearing on plaintiff's application for a
temporary restraining order on October 5, 1981, the parties
entered into a stipulation whereby plaintiff would withdraw its
motions without prejudice, and defendants would rescind their
previous finding, re-evaluate plaintiff's ability to perform the
contract, and issue no work order under the award until they
completed a new pre-award survey.

On November 6, 1981, the GPO informed plaintiff that it had been
determined responsible.  Accordingly, the contract with the
second low bidder was cancelled and was then awarded to

This Application for Attorneys' Fees followed on November 16,
1981.  Specifically, plaintiff seeks $ 10,576.00 as compensation
for 126.9 hours expended by its attorneys on this case.
Plaintiff has also requested reimbursement for litigation costs
totalling $ 255.22. 2


Under the "American Rule" prevailing litigants are not ordinarily
entitled to collect attorneys' fees from the loser. Alyeska
Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 247, 95
S. Ct. 1612, 1616, 44 L. Ed. 2d 141 (1975). It is also well
established that attorneys' fees may not be levied against the
United States unless expressly provided for by Congress.  Id. at
265-68, 95 S. Ct. at 1626-27; National Ass'n for Advancement of
Colored People v. Civiletti, 197 U.S. App. D.C. 259, 261, 609
F.2d 514, 516 (1979), cert. denied 447 U.S. 922, 100 S. Ct. 3012,
65 L. Ed. 2d 1114 (1980).

In 1980 Congress enacted the Equal Access to Justice Act, Pub.L.
No. 96-481, 94 Stat. 2325 (1980).  Section 204(a) of the Act
amended 28 U.S.C.  2412 to authorize attorneys' fees against the
United States under certain circumstances. First, a court may
assess fees and expenses against the government to the same
extent that a private party would be liable for the same pursuant
to common law or statute.  28 U.S.C.  2412(b).  Second,
subsection (d)(1)(A) of the Act provides, in pertinent part:

(A) court shall award to a prevailing party other than the United
States fees and other expenses * * * incurred by that party in
any civil action (other than cases sounding in tort) 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.

28 U.S.C.  2412(d)(1)(A).  "(F)ees and other expenses" includes
reasonable attorneys' fees.  28 U.S.C.  2412(d)(2)(A).

Since the Court is unaware of any common law or statutory
exception to the "American Rule" that applies to this case,
plaintiff is entitled to attorneys' fees only if it satisfies the
requirements promulgated in subsection (d)(1)(A) of the Act.

As a threshold matter plaintiff must qualify as a small business
under the Act.  28 U.S.C.  2412(d)(2)(B).  In its application
plaintiff asserts that it fulfills these requirements by
employing no more than 500 individuals and having a net worth
less than $ 5,000,000. 3 Defendants do not dispute this

The Act became effective on October 1, 1981, and applies to any
civil action "which is pending on, or commenced on or after, such
date." Pub.L. No. 96-481,  208, 94 Stat. 2330 (1980) (see 28
U.S.C.  2412 note).  Although the action in this Court was filed
after the effective date of the statute, on October 2, 1981,
approximately 11.4 of the hours expended were for work performed
on September 30, 1981.  Defendants maintain that these hours are
not covered by the Act.

The Court begins with the well settled principle that the
starting point for interpreting a statute is the language of the
statute itself.  Absent an indication to the contrary in the
legislative history the wording of the statute should be given
its plain, clear and common meaning.  Consumer Product Safety
Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S. Ct. 2051,
2056, 64 L. Ed. 2d 766 (1980); Aaron v. Securities and Exchange
Comm'n, 446 U.S. 680, 700, 100 S. Ct. 1945, 1957, 64 L. Ed. 2d
611 (1980); Perrin v. United States, 444 U.S. 37, 42, 100 S. Ct.
311, 314, 62 L. Ed. 2d 199 (1979); American Trucking Ass'ns, Inc.
v. United States, 195 U.S. App. D.C. 266, 271-72, 602 F.2d 444,
449-50, cert. denied 444 U.S. 991, 100 S. Ct. 522, 62 L. Ed. 2d
420 (1979); Higgins v. Marshall, 190 U.S. App. D.C. 54, 56, 584
F.2d 1035, 1038 (1978), cert. denied 441 U.S. 931, 99 S. Ct.
2051, 60 L. Ed. 2d 659 (1979).

The Act explicitly applies to cases pending on October 1, 1981,
and nothing in the legislative history suggests that it should be
interpreted to apply only to that part of a case pending on
October 1, 1981 that occurs on or after that date.  Moreover,
construing the Act to bifurcate cases on October 1, 1981 would
eschew the purpose of the Act to provide financial assistance to
those litigants who would not ordinarily be able to contest
unreasonable government action,4 as it would diminish their
recovery and thereby remove the incentive to sue.  Without
express direction from Congress this Court will not infer such an
incongruous intent. 5

Only "prevailing parties" may recover attorneys' fees from the
United States. The legislative history clearly states that the
term "prevailing party," for purposes of the Act, is not limited
to those litigants who win a final judgment following trial on
the merits.  It includes parties who obtain a favorable
settlement of their case.  H.R.Rep.No.96-1418, 96th Cong., 2nd
Sess. 11, reprinted in (1980) U.S.Code Cong. and Ad.News 4953,
4990.  See Foster v. Boorstin, 182 U.S. App. D.C. 342, 561 F.2d
340 (1977). Plaintiff's sole goal throughout the various stages
of this dispute was to secure the contract to print and
distribute the Federal Personnel Manual.  While the stipulation
entered into in this Court did nothing more than guarantee
plaintiff further consideration, plaintiff eventually was awarded
the contract.  Had a different result ensued it is obvious that
plaintiff would have renewed its action in this Court.  The Court
therefore concludes that plaintiff prevailed in this case.

Under the terms of the Act plaintiff may not recover attorneys'
fees if "the position of the United States was substantially
justified" or "special circumstances make an award unjust." 28
U.S.C.  2412(d)(1)(A).

The test of whether or not a Government action is substantially
justified is essentially one of reasonableness.  Where the
Government can show that its case had a reasonable basis both in
law and fact, no award will be made.  In this regard, the strong
deterrents to testing Government action require that the burden
of proof rest with the Government.  This allocation of the
burden, in fact, reflects a general tendency to place the burden
of proof on the party who has readier access to and knowledge of
the facts in question.  The committee believes that it is far
easier for the Government, which has control of the evidence, to
prove the reasonableness of its action than it is for a private
party to marshal the facts to prove that the Government was

H.R.Rep.No.96-1418, 96th Cong., 2nd Sess. 10-11, reprinted in
(1980) U.S.Code Cong. and Ad.News 4989.  Another reason for
placing the burden of proof on the government stems from the
underlying, and deeply imbedded, conflict between the historical
reluctance of courts to shift fees and the remedial purpose 6 of
the Act.  H.R.Rep.No.96-1418, 96th Cong., 2nd Sess. 9-10,
reprinted in (1980) U.S.Code Cong. and Ad.News 4987-89.

The term "position of the United States" is not defined in the
Act or legislative history.  Defendants claim that the gravamen
of plaintiff's action in this Court was that the GPO's
nonresponsibility determination was subject to Small Business
Administration review.  Since defendants believe that the Small
Business Administration does not have jurisdiction to review the
GPO's finding, and show a genuine dispute regarding this issue,
they contend that their "position" was substantially justified.

Even if the Court accepts these arguments, defendants have failed
to meet the burden of proof under the Act, as they have presented
no justification for their initial position in this case.
Section 202 of the Act, Pub.L. No. 96-481, 94 Stat. 2325 (1980)
(see 5 U.S.C.  504 note), states that the purpose of the Act is
to supplant the economic deterrence to defending against
unreasonable government action.  In order to ensure
evenhandedness the Court must scrutinize not only the
government's theory in defending the legal issues raised but also
the occurrences that impelled plaintiff to bring this action. 7
In this case the GPO rejected plaintiff's low bid on a $ 700,000
contract with no more than a terse three-sentence letter.  This
is precisely the type of government action that small businesses
do not ordinarily have the resources to contest, and the Act is
therefore intended to prevent.  Since there are no special
circumstances here to make an award unjust, the Court concludes
that plaintiff is entitled to recover reasonable attorneys' fees.


The remaining issue before the Court is whether the attorneys'
fees and litigation costs requested are reasonable.

Initially, defendants argue that some of the hours billed were
not related to the civil action; rather, they concerned matters
at the administrative level which are not covered by the Act.  It
appears to the Court, however, that the hours billed prior to
October 2, 1981, the date the action commenced in this Court,
were for preparation of the lengthy document filed that day.
They are therefore recoverable.

Any fee-setting inquiry begins with the " "lodestar': the number
of hours reasonably expended multiplied by a reasonable hourly
rate".  Copeland v. Marshall, 205 U.S. App. D.C. 390, 401, 641
F.2d 880, 891 (1980). Here, an additional constraint is provided
by the Act, which sets a $ 75 per hour limit 8on attorneys' fees
unless the court determines that an increase in the cost of
living or a special factor, such as the limited availability of
qualified attorneys, justifies a higher rate.  28 U.S.C. 
2412(d)(2)(A). Plaintiff presents no argument on this point and
the Court finds no compelling reason to raise the statutory

While there is no doubt that the representation here was expert
and effective it appears to the Court that the time expended was
inordinately high.  For example, preparation of this application,
a relatively simple document, consumed 13.6 billable hours.
Nonproductive time is not compensable and must be excluded from
the lodestar.  Copeland v. Marshall, 205 U.S. App. D.C. at 401,
641 F.2d at 891. Taking into consideration the nature of the
proceedings and the papers filed, the Court concludes that
plaintiff's attorneys should have spent closer to 75 hours
preparing this case. 9 The Court will therefore accept the $ 75
hourly rate for all attorneys and strike 40% of the time expended
as nonproductive.  Plaintiff is entitled to recover $ 5710.50
from the government for attorneys' fees.

Plaintiff requests $ 255.22 10 as reimbursement for the costs of
litigation. Under 28 U.S.C.  2412(d)(2)(A), plaintiff may
recover "the reasonable cost of any study, analysis, engineering
report, test, or project which is found by the court to be
necessary for the preparation of the party's case * * *."
Plaintiff may also recover fees of the clerk and marshal, copy
and printing costs, and docket fees.  28 U.S.C.  1920, 2412(a).
Overtime meals, car, local transportation and miscellaneous costs
are not recoverable under the Act.  See Norman v. United States,
74 F.R.D. 637, 639 (D.Del.1977). Accordingly, the Court finds
that plaintiff is entitled to recover $ 190.56 as reimbursement
for litigation costs.

February 22, 1982


1  Plaintiff's Application for Attorneys' Fees, Exhibit A.

2  Plaintiff's Application for Attorneys' Fees, Exhibit G.

3  Affidavit of F. Scott Watkins, Plaintiff's Application for
Attorneys' Fees, Exhibit G.

4  Section 202 of the Act, Pub.L. No. 96-481, 94 Stat. 2325
(1980) (see 5 U.S.C.  504 note).

5  While no case, to this Court's knowledge, has directly
confronted this issue, the few cases that have discussed
attorneys' fees in actions pending on October 1, 1981, suggest
that fees incurred antecedent to the effective date of the
statute may be recovered.  See Heydt v. Citizens State Bank, 668
F.2d 444 (8th Cir. 1982); Kinzley v. United States, 228 Ct. Cl.
620, 661 F.2d 187, 193 (Ct.Cl.1981); Matthews v. United States,
526 F. Supp. 993, 1008 (M.D.Ga.1981); Muth v. Marsh, 525 F. Supp.
604, 609 (D.D.C.1981) ("This action was obviously pending on
October 1 and plaintiff may therefore apply for fees and costs *
* * should he be the "prevailing party' in this Court."); cf.
Alspach v. District Director of Internal Revenue, 527 F. Supp.
225, 226 n.1 (D.Md.1981) ("Because of the disposition of this
case, it is unnecessary to decide that troublesome question.").

Moreover, this interpretation of the Act is consistent with the
construction given similar attorneys' fee statutes.  See, e.g.,
Bradley v. School Brd. of the City of Richmond, 416 U.S. 696,
710-711, 721, 94 S. Ct. 2006, 2015-2016, 2021, 40 L. Ed. 2d 476
(1974) (20 U.S.C.  1617); Corpus v. Estelle, 605 F.2d 175, 180
(5th Cir. 1979), cert. denied 445 U.S. 919, 100 S. Ct. 1284, 63
L. Ed. 2d 605 (1980) (42 U.S.C.  1988). Under Bradley the fee
award statute applies to services rendered prior to its effective
date in an action pending on that date unless manifest injustice
would result, or there is statutory directive or legislative
history suggesting the contrary.  416 U.S. at 711, 721, 94 S. Ct.
at 2016, 2021.

6  The general purpose of the Act is to insure the vindication of
rights of parties who might otherwise be precluded from the
adjudicatory process due to the prohibitive costs of seeking
justice.  Small businesses, in particular, are often vulnerable
to coercive agency action.  H.R.Rep.No.96-1418, 96th Cong., 2nd
Sess. 9-10, 12, 18, reprinted in (1980) U.S.Code Cong. and
Ad.News 4987-89, 4991, 4997.  See also note 4, supra, and
accompanying text.

7  The Court draws instruction from parallel language in
Fed.R.Civ.P. 37(a) (4).  Under that Rule a court may require the
losing party to a motion to compel discovery to pay attorneys'
fees if that party was not "substantially justified" in opposing
or making the motion.  The Advisory Committee stated that this
remedy was created to "deter the abuse implicit in carrying or
forcing a discovery dispute to court when no genuine dispute
exists." Advisory Committee's Note to 1970 Amendment of
Fed.R.Civ.P. 37(a)(4), 48 F.R.D. 487, 540. Likewise, the Act is
intended to proscribe frivolous government action that forces a
party to resort to the courts to redress its rights.  It would
contradict the remedial purpose of the Act to interpret it to
isolate and focus upon the reasonableness of only a single
element of the government's actions, when the entire factual
background may suggest a contrary conclusion.  Contra, Alspach v.
District Director of Internal Revenue, 527 F. Supp. 225, 228
(D.Md.1981) ("position of the United States" refers to its
position in prosecuting or defending litigation rather than its
action upon which suit is based).

8  The $ 10,576.00 requested reflects hourly rates ranging
between $ 75 and $ 130.

9  A more detailed calculation of the lodestar would require
further affidavits from plaintiff's counsel.  The Court would
also have to consider defendants' request for discovery on the
issue of reasonable fees.  The Court believes that any hours
added or stricken would not be significant enough to justify the
additional preparation and discovery costs, which would
consequently increase the amount chargeable to United States

10        Category                     Cost

         Duplicating                $ 148.00
         Postage                        2.96
         Messenger Service             25.60
         Filing and Miscellaneous      28.00
         Overtime Meals and Car        20.16
         Local Transportation          30.50
                                    $ 255.22