Mann v. United States

In the United States Court of Federal Claims

No. 98-312C

(Filed July 14, 2014)

NOT FOR PUBLICATION

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STANLEY K. MANN, *

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Plaintiff, *

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v. *

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THE UNITED STATES, *

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Defendant. *

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MEMORANDUM OPINION AND ORDER

WOLSKI, Judge.

The matter before the Court is the application of plaintiff Stanley K. Mann

for an award of attorney’s fees and costs brought under the Equal Access to Justice

Act (“EAJA”), 28 U.S.C. § 2412. The Court had previously determined that plaintiff

was entitled to $869,501.52 in damages for the government’s breach of his

geothermal lease. See Mann v. United States, 86 Fed. Cl. 649 (2009) (Mann IV).

Mister Mann has applied for a total of $373,999.14 in attorney’s fees and costs,

broken down as follows: $262,449.17 in attorney’s fees; $90,817.65 in fees and

expenses incurred directly by him or by his attorneys (part of which was also

included in plaintiff’s Bill of Costs as the subject of a claim for allowable costs made

to the Clerk of the Court pursuant to Rule 54(d) of the Rules of the United States

Court of Federal Claims (“RCFC”)); and $20,732.32 in attorney’s fees and expenses

for the EAJA phase of this case. Pl.’s Mot. for Attorney’s Fees and Expenses ¶ 4

(“Pl.’s Mot.”); Pl.’s Reply Mem. in Supp. of Pl.’s Mot. at 19–20 & n.14 (“Pl.’s Reply”).

For the reasons below, the Court concludes that Mr. Mann is entitled to

$368,759.44, which represents the full amount of requested attorney’s fees and

costs, reduced only by those costs already awarded or disallowed by the Clerk of the

Court.

I. BACKGROUND

This case concerns a geothermal lease originally issued by the Bureau of

Land Management (“BLM”) to Southland Royalty Company in 1981 for the purpose

of developing and utilizing geothermal resources on land administered by the

Secretary of the Interior. See Mann IV, 86 Fed. Cl. at 651. Southland Royalty

Company immediately assigned the lease to Chaffee Geothermal, Ltd. (“Chaffee”),

which drilled three production wells on the leased land in 1981 and 1982. Id.

Although Chaffee found several production zones of hot water, Chaffee’s investors

ceased providing funding for the company and Chaffee’s employees were laid off in

February 1983. Id. at 652. The lease was ultimately reassigned to Mr. Mann,

former chief executive officer of Chaffee and then-president of Crowne Geothermal,

Ltd. (“Crowne”). Id. In 1986, the BLM approved the lease reassignment to Mr.

Mann in his individual capacity, after which time Mr. Mann became the sole lessee

of the property and paid all expenses related to developing geothermal resources on

the land. See Mann v. United States, 68 Fed. Cl. 666, 668 (2005) (Mann III).

Mister Mann corresponded with the BLM and the Minerals Management

Service (“MMS”) throughout the course of the lease using a Malibu, California

address --- his address of record with the agency. Mann v. United States, 334 F.3d

1048, 1052 (Fed. Cir. 2005) (Mann II). In 1993, the BLM issued a “Lease

Determination” to inform Mr. Mann that his lease would expire thirty days after

receipt of the decision unless he was able to demonstrate his “diligent efforts” to

utilize the geothermal resources on the leased land. Id. at 1049–50. However, the

BLM sent a copy of the Lease Determination to Mr. Mann at a Costa Mesa,

California address for Crowne --- it had obtained this address from an unsigned,

courtesy copy of correspondence between Mr. Mann and his lease bond insurance

company that Mr. Mann had forwarded to the BLM. Mann III, 68 Fed. Cl. at 668.

The Lease Determination was returned to the BLM as “unclaimed,” and thereafter

the BLM made no additional attempts to contact Mr. Mann regarding the

termination of his lease. See Mann II, 334 F.3d at 1050. Mister Mann did not learn

of the Lease Determination until more than eighteen months later during a visit to

the BLM, where he was finally informed that his lease had terminated sixty days

from the date the mailed Lease Determination was returned to the BLM. Id.

Mister Mann unsuccessfully appealed the BLM’s termination decision before

the Interior Board of Land Appeals (“IBLA”). Mann IV, 86 Fed. Cl. at 652. He

subsequently sought district court review of the IBLA’s determination under the

Administrative Procedure Act, 5 U.S.C. §§ 702, 706, but voluntarily dismissed that

action in order to pursue his claims in this court. See id. His original complaint

included a claim for breach of contract as well as two Fifth Amendment claims ---

one for the taking of private property without the payment of just compensation and

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one for the deprivation of property without due process of law. Id. 1 The court

granted the government’s motion to dismiss the due process claim for lack of subject

matter jurisdiction, granted the government’s motion for summary judgment on the

breach of contract claim, and denied Mr. Mann’s cross motion for judgment as to

liability. See Mann v. United States, 53 Fed. Cl. 562 (2002) (Mann I). The Federal

Circuit reversed the decision regarding the breach of contract claim, finding that

the government breached the terms of the lease agreement with Mr. Mann by

sending the Lease Determination to the wrong address and thus failing to provide

him the requisite notice prior to termination. See Mann II, 334 F.3d at 1052.

Having ruled on liability, the Federal Circuit remanded the case to this court where

it was re-assigned to the undersigned for a determination on damages. The

government moved for partial summary judgment, arguing that Mr. Mann was not

entitled to recovery based on either the theory of lost profits or restitution. See

Mann III, 68 Fed. Cl. at 666. That motion was denied. After a three-day trial on

damages in Las Cruces, New Mexico and extensive post-trial briefs filed by both

parties, judgment was entered in Mr. Mann’s favor in the amount of $869,501.52.

See Mann IV, 86 Fed. Cl. at 667–68. Mister Mann now seeks an award of attorney’s

fees and expenses pursuant to the EAJA.

II. DISCUSSION

A. Legal Standard

Recognizing the “economic deterrent” created by the mounting costs of

litigation and the vast disparity in resources between the government and

individuals (including certain organizations), Congress enacted the EAJA “to

eliminate legal expenses as a barrier to challenges of unreasonable government

action.” Cmty. Heating & Plumbing Co. v. Garrett, 2 F.3d 1143, 1145 (Fed. Cir.

1993) (quoting Ellis v. United States, 711 F.2d 1571, 1576 (Fed. Cir. 1983)); see H.R.

Rep. No. 96-1418, at 5–6 (1980). The EAJA gives this Court authority to “award to

a prevailing party other than the United States fees and other expenses . . . 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)

(2012). The statute makes clear that “fees and other expenses” include “the

reasonable expenses of expert witnesses, 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, and reasonable attorney fees.” Id.

§ 2412(d)(2)(A). The amount of “reasonable attorney fees” is calculated based upon

“prevailing market rates,” but is capped at $125 per hour unless the court

determines that a cost of living adjustment is appropriate. Id.

1 Plaintiff dropped the takings claim prior to oral argument. See Mann v. United

States, 53 Fed. Cl. 562, 563 n.1 (2002) (Mann I).

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A “prevailing party” is eligible for attorney’s fees “incurred by that party in

any civil action . . . brought by or against the United States.” 28 U.S.C.

§ 2412(d)(1)(A). The EAJA defines “party” as “an individual whose net worth did

not exceed $2,000,000 at the time the civil action was filed.” Id. § 2412(d)(2)(B). A

party is considered to be prevailing “if he succeeded ‘on any significant issue which

achieves some of the benefits sought by the suit.’” Loomis v. United States, 74 Fed.

Cl. 350, 353 (2006) (quoting Owen v. United States, 861 F.2d 1273, 1274 (Fed. Cir.

1988)).

The EAJA requires, within thirty days of final judgment, the party seeking a

fee award to “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 . . . stating

the actual time expended and the rate at which fees and other expenses were

computed.” 28 U.S.C. § 2412(d)(1)(B). The EAJA requires the party seeking the fee

award to allege in its fee application that the position of the United States was not

substantially justified. Id. The government, however, bears the burden of

demonstrating that its position was substantially justified. See, e.g., Dalles

Irrigation Dist. v. United States, 91 Fed. Cl. 689, 697 (2010); see also White v.

Nicholson, 412 F.3d 1314, 1315 (Fed. Cir. 2005). Indeed, the statute “imposes no

burden on the fee applicant.” Scarborough v. Principi, 541 U.S. 401, 414 (2004).

The government’s position as contemplated by the EAJA includes both “the

position taken by the United States in the civil action [and] the action or failure to

act by the agency upon which the civil action is based[.]” 28 U.S.C. § 2412(d)(2)(D);

see also, e.g., Comm’r v. Jean, 496 U.S. 154, 158 (1990) (stating that “position of the

United States” means “both the agency’s prelitigation conduct and the Department

of Justice’s subsequent litigation positions”); Doty v. United States, 71 F.3d 384, 386

(Fed. Cir. 1995) (same); Filtration Dev. Co., L.L.C. v. United States, 63 Fed. Cl. 612,

619 (2005) (same). Indeed, the Federal Circuit has underscored that “[i]n the

context of EAJA claims, . . . the ‘position of the United States’ . . . refers to the

United States’ position ‘throughout the dispute, including not only its litigating

position but also the agency’s administrative position.’” Blakely v. United States,

593 F.3d 1337, 1341 (Fed. Cir. 2010) (quoting Doty, 71 F.3d at 386). “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.” 28 U.S.C. § 2412(d)(1)(B).

The Supreme Court has explained that a position is “substantially justified”

if it is “justified in substance or in the main --- that is, justified to a degree that

could satisfy a reasonable person. That is no different from the reasonable basis

both in law and fact formulation . . . .” Pierce v. Underwood, 487 U.S. 552, 565–66

(1988); see also KMS Fusion, Inc. v. United States, 39 Fed. Cl. 593, 598 (1997).

Importantly, though, “a position can be justified even though it is not correct,

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and . . . it can be substantially (i.e., for the most part) justified if a reasonable

person could think it correct . . . .” Pierce, 487 U.S. at 566 n.2. The government’s

position cannot be substantially justified when it violates established agency

precedent or contradicts unambiguous regulations. See Geo-Seis Helicopters, Inc. v.

United States, 79 Fed. Cl. 74, 78 (2007) (“The government’s position will not be

found to be reasonable or substantially justified when explicit, unambiguous

regulations directly contradict that position.”); Hillensbeck v. United States, 74 Fed.

Cl. 477, 481 (2006) (“For purposes of an award under the EAJA, ‘[t]here is no

justification for the [G]overnment’s position when clear, unambiguous regulations

directly contradict that position.’” (quoting Filtration Dev. Co., 63 Fed. Cl. at 621)).

In determining whether the government’s position was substantially

justified, the court should “treat[] the case as an inclusive whole, rather than as

atomized line-items.” Jean, 496 U.S. at 162; Filtration Dev. Co., 63 Fed. Cl. at 619.

As such, the court’s finding as to “substantial justification” is a single determination

that considers the conduct of both the relevant agency prior to litigation and the

government during litigation. Id. Success or failure in a prior tribunal is not

necessarily indicative of whether a position was substantially justified. See Pierce,

487 U.S. at 569 (“Obviously, the fact that one other court agreed or disagreed with

the Government does not establish whether its position was substantially justified.

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.”); Cmty. Heating, 2 F.3d at 1145–46 (“[T]he position of the

government is not shown to be substantially justified merely because the

government prevailed before a lower tribunal.”). Rather, the focus “is whether the

‘government’s overall position’ is substantially justified, ‘examin[ing] not only the

government’s success or failure, but also the reasonableness of its position in

defending against the suit.” Precision Pine & Timber, Inc. v. United States, 83 Fed.

Cl. 544, 551 (2008) (quoting CEMS, Inc. v. United States, 65 Fed. Cl. 473, 479

(2005)).

B. Eligibility for Award

Plaintiff contends that he is entitled to an EAJA award because he is the

“prevailing party,” there are no “special circumstances” as contemplated by the

EAJA, and neither the government’s position during the course of the litigation nor

the BLM’s underlying conduct giving rise to the litigation were substantially

justified. Mem. in Supp. of Pl.’s Mot. for Att’ys Fees & Expenses Under the Equal

Access to Justice Act at 5 (“Pl.’s Mem.”). The government does not dispute Mr.

Mann’s timely filing of his fee application or his status as the prevailing party, nor

does it contend that there are any special circumstances in this case that would

preclude an award of attorney’s fees and costs pursuant to the EAJA. Rather, the

government maintains that its position was substantially justified and thus that

Mr. Mann is not entitled to a fee award. See Def.’s Opp’n to Pl.’s Application for the

Award of Fees & Other Expenses at 2–5 (“Def.’s Mem.”). The Court finds that the

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government has failed to meet its burden of demonstrating that the position of the

United States was “substantially justified” within the meaning of the EAJA.

The EAJA requires the party petitioning for costs and fees to allege that the

position of the government was not substantially justified. 28 U.S.C.

§ 2412(a)(1)(B); see Scarborough, 541 U.S. at 414. According to plaintiff, the

government’s position at the agency level was not substantially justified because

the BLM failed to follow binding precedent and its own regulations when it mailed

the Lease Determination to the wrong address and failed to subsequently ensure

that Mr. Mann received the notification. Pl.’s Mem. at 11–12. Further, plaintiff

contends that the government’s litigation positions were not substantially justified

because they lacked evidentiary support or were rejected at some stage of the

litigation --- either in this court or at the Federal Circuit. Id. at 13–19. Plaintiff

has thus satisfied the pleading threshold, and the burden is on the government to

demonstrate its position was substantially justified.

While the government certainly contests plaintiff’s characterization of its

conduct at the administrative level, it does not offer satisfactory evidence to meet its

burden of demonstrating that its conduct was substantially justified. Indeed, the

government does not substantively address plaintiff’s charge that the agency failed

to follow binding precedent when it mailed the Lease Determination to Mr. Mann’s

Costa Mesa, California address instead of the Malibu, California address that it had

on file. Rather, the government argues that its position “as a whole” was

substantially justified. Specifically, the government argues that because neither

this Court nor the Federal Circuit reached the merits of the BLM’s termination

decision, there is an insufficient record on which to evaluate the BLM’s decision to

terminate plaintiff’s lease, Def.’s Mem. at 3–4, and that in any event the BLM was

substantially justified in sending the lease termination notification to the Costa

Mesa, California address as evidenced by this Court’s ruling to that effect in Mann

I. Id. at 2–3. 2 Moreover, the government relies on the fact that plaintiff did not

prevail on every issue at trial and a favorable ruling in this court in support of the

“reasonableness” of its litigation positions. Id. at 5–6.

Examining the government’s position as a whole, the Court is not persuaded

that the government’s agency position or litigation positions were substantially

justified. As to the agency position, the BLM was not substantially justified in

sending the Lease Determination to the wrong address and failing to correct the

mistake when the Lease Determination was returned as “unclaimed.” First, it is

well-established that prior favorable rulings are not dispositive in determining

2 The argument concerning the termination decision is misguided. Based on the

trial record, the Court specifically found that “Mr. Mann did make diligent efforts to

utilize these resources through the date of the breach and could have established

this to BLM’s satisfaction.” Mann IV, 86 Fed. Cl. at 664.

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substantial justification. See Pierce, 487 U.S. at 569; Cmty. Heating, 2 F.3d at

1145–46. Here, although the trial court originally found that it was reasonable for

the BLM to mail the Lease Determination to the Costa Mesa, California address,

that finding has no bearing on this Court’s determination of whether it was

reasonable for the agency to do so. Second, relevant precedent makes clear that

conduct that is contrary to binding precedent and regulations cannot be

substantially justified --- here, the BLM was required under its own regulations to

send the Lease Determination to Mr. Mann’s “last address of record,” which was his

Malibu, California address. See Mann II, 334 F.3d at 1052. Instead, the BLM

mailed the Lease Determination to a Costa Mesa, California address for plaintiff’s

business --- an address it obtained from an unsigned copy of correspondence

between Mr. Mann and his lease bond insurance agency --- thereby violating

applicable regulations and breaching the lease. Further, when the Lease

Determination was sent back to the BLM as “unclaimed,” the BLM did nothing,

which was both unreasonable and a violation of agency regulations. Under these

circumstances, the BLM’s conduct was not substantially justified.

As to the government’s litigation positions, the government correctly points

out that “individual arguments are not the proper focus of an EAJA analysis.”

Def.’s Mem. at 4. The government thus contends that although plaintiff ultimately

prevailed, the government’s litigation position “as a whole” was substantially

justified. Def.’s Mem. at 4-5. The Court, however, finds that the position taken by

the government during litigation was not reasonable and thus was not substantially

justified. Here, the government’s contended that sending the Lease Determination

to the Costa Mesa, California address constituted sufficient constructive notice

because that was his “last address of record” with the BLM. Def.’s Mem. at 2–3; see

also Mann II, 334 F.3d at 1051. The government based this argument on the

courtesy copy of the correspondence Mr. Mann sent as president of Crowne

Geothermal to his lease bond agency and forwarded to the BLM, listing the Costa

Mesa, California address.

While the regulations incorporated into Mr. Mann’s lease did not define the

phrase “last address of record,” IBLA precedent states that a lessee’s “last address

of record” is “‘the place where the party to receive documents has declared he will

receive such delivery.’” Mann II, 334 F.3d at 1052 (quoting Arthur M. Solender, 79

I.B.L.A. 70, 73 (1984)). In this case, Mr. Mann’s last address of record with the

BLM was his Malibu, California address. As the Federal Circuit noted, Mr. Mann

did not express any intent to change his address of record with the BLM when he

forwarded a letter he sent to his lease bond agency as a courtesy to the BLM. See

id. Thus, it was not reasonable for the government to argue during litigation that it

had provided sufficient notice of termination by sending the Lease Determination to

the Costa Mesa, California address. Moreover, although the government did prevail

on certain individual issues during the trials on the merits and damages, see id.; see

also Mann I, 53 Fed. Cl. at 567–69 (rejecting Mr. Mann’s due process claim and his

claim that he was entitled to actual notice of the Lease Determination); Mann II,

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334 F.3d at 1051 (upholding the trial court’s rejection of Mr. Mann’s claim that he

was entitled to actual notice of the Lease Determination); Mann IV, 86 Fed. Cl. at

666–68 (rejecting Mr. Mann’s lost profits damages theory in total and his reliance

and restitution theories in part), the appropriate inquiry is not whether individual

arguments made by the government were reasonable but instead whether its

position “as a whole” was substantially justified. Given the underlying facts in this

case the Court is not persuaded that the government’s litigation position as a

whole --- that it provided sufficient notice by sending the Lease Determination to

the Costa Mesa, California address --- was substantially justified. Thus, the Court

finds that the government has not satisfied its burden and, accordingly, plaintiff is

entitled to attorney’s fees and costs under the EAJA.

C. Quantum of Award

Having determined that Mr. Mann is entitled to attorney’s fees and costs, the

court has discretion to determine what fee is reasonable. See Jean, 496 U.S. at 161;

Oliveira v. United States, 827 F.2d 735, 744 (Fed. Cir. 1987). A party seeking an

award of fees must submit “an itemized statement . . . stating the actual time

expended and the rate at which fees and other expenses were computed.” 28 U.S.C.

§ 2412(d)(1)(B). Plaintiff seeks: (1) $262,449.17 in attorney’s fees and $90,117.65 3

in costs for the merits phase of the litigation, and (2) $21,432.32 in attorney’s fees

and costs for the EAJA phase of the litigation. 4 Pl.’s Mot. ¶ 4; Pl.’s Reply at 19–20

& n.14. Plaintiff’s request for attorney’s fees includes a cost of living adjustment

(“COLA”) above the statutory cap of $125 per hour set by the EAJA. Pl.’s Mem. at

20. While the government does not challenge Mr. Mann’s fee calculation or his

request for a COLA, the government does argue that plaintiff’s fee award should be

reduced to reflect his “limited success” and that plaintiff should not recover any

costs for those witnesses who offered testimony in connection with his unsuccessful

claim for lost profits. Def.’s Mem. at 10.

1. Reasonable Attorney’s Fees

The first step in determining the amount of reasonable attorney’s fees is to

calculate the lodestar amount by multiplying the number of hours spent on the

litigation by a reasonable hourly rate not to exceed the statutory cap of $125 per

hour. First Fed. Sav. & Loan Ass’n v. United States, 88 Fed. Cl. 572, 587 (2009)

(citing Hensley v. Eckerhart, 461 U.S. 424, 433–34 (1983)). Plaintiff has submitted

3 Plaintiff’s total request for costs includes $5,239.70 in costs that were also

included in the Bill of Costs submitted to the Clerk of the Court pursuant to RCFC

54(d).

4 The $21,432.32 in attorney’s fees and costs requested for the EAJA phase includes

a $700 fee incurred to prepare Mr. Mann’s Statement of Financial Condition. See

infra Part II.C.3.

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sufficient documentation to reflect that his attorneys worked 1,703.19 hours on the

merits phase of his case. Multiplied by the statutory hourly rate of $125 per hour,

plaintiff would be entitled to a total of $212,898.75 in attorney’s fees for the merits

phase of the litigation. The government contests this calculation only inasmuch as

it includes time spent in connection with expert witnesses Jack Whittier and Angela

Crooks, provided by McNeil Technologies, Inc., to testify in connection with

plaintiff’s claim for lost profits. Def.’s Mem. at 10. For the reasons that follow, the

Court finds that plaintiff is entitled to the full amount of attorney’s fees he seeks.

Where a plaintiff is the prevailing party but has succeeded on only some of

his claims for relief, this Court has discretion to adjust the fee based upon the

results obtained by the plaintiff. See Hensley, 424 U.S. at 434–35 (“There remain

other considerations that may lead the district court to adjust the fee upward or

downward, including the important factor of the ‘results obtained.’ This factor is

particularly crucial where a plaintiff is deemed ‘prevailing’ even though he

succeeded on only some of his claims for relief.”). But see Dalles Irrigation Dist., 91

Fed. Cl. at 698 (“‘[A]ttorney’s fees are not limited to the dollars awarded,’ nor is it

necessary for the claimant to have obtained success on all items of relief requested.”

(citations omitted) (quoting Hubbard v. United States, 80 Fed. Cl. 282, 286 (2008),

aff’d, 315 Fed. App’x 307 (Fed. Cir. 2009))). In a case where a plaintiff presents

distinctly different claims for relief based on different facts and legal theories, work

done on one claim may be unrelated to work on another claim, and as such “work on

an unsuccessful claim cannot be deemed to have been ‘expended in pursuit of the

ultimate result achieved.’” Hensley, 461 U.S. at 435.

Where a plaintiff’s claims for relief, however, involve “a common core of facts

or will be based on related legal theories . . . the district court should focus on the

significance of the overall relief obtained by the plaintiff in relation to the hours

reasonably expended on the litigation.” Id. at 435. Indeed, it may be that where a

plaintiff’s claims arise from a common set of facts, the court may not be able to

“divide the portion of fees spent on separate issues . . . for distinctly different

claims.” Loomis, 74 Fed. Cl. at 359. In those situations, a “fee award is not reduced

‘simply because the plaintiff failed to prevail on every contention raised in the

lawsuit.’” Id. Rather, “litigants in good faith may raise alternative legal grounds

for a desired outcome, and the court’s rejection of or failure to reach certain grounds

is not a sufficient reason for reducing a fee. The result is what matters.” 5 Hensley,

461 U.S. at 435. While “[a] reduced fee award is appropriate if the relief, however

5 Although Hensley dealt with an award of fees pursuant to Civil Rights Attorney’s

Fees Awards Act of 1976, 42 U.S.C. § 1988, the Federal Circuit extended this test to

claims brought under the EAJA. See Hubbard v. United States, 480 F.3d 1327,

1333 (Fed. Cir. 2007) (“Although [Hensley] involved the fee-shifting provision of the

Civil Rights Act, we see no reason why the foregoing principles there announced

should not be equally applicable to the parallel fee-shifting provision of the Equal

Access to Justice Act.”).

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significant, is limited in comparison to the scope of the litigation as a whole,” id. at

440, this Court has discretion to weigh the degree of success and determine the

extent to which the result in a particular case dictates whether the fee award

should be reduced. Id. at 436–37 (“There is no precise rule or formula for making

these determinations. . . . The court necessarily has discretion in making this

equitable judgment.”); Dalles Irrigation Dist., 91 Fed. Cl. at 699 (“[I]n a case where

significant but partial success was obtained, the degree of success factors into the

amount of fees awarded[.]”); Loomis, 74 Fed. Cl. at 359.

At trial to determine damages, plaintiff based his claims for breach of

contract damages on the alternative legal theories of lost profits, reliance, and

restitution. See Mann IV, 86 Fed. Cl. at 663–68. Although this Court rejected

plaintiff’s lost profits theory, the Court found that plaintiff was entitled to

$869,501.52 in damages based upon the alternative grounds of reliance or

restitution. Id. at 667. There, plaintiff’s claims were based upon the same

underlying core of facts --- the circumstances surrounding the government’s breach

of his geothermal lease --- and the alternative forms of relief he sought were based

upon the various forms of relief available as breach of contract damages. Although

plaintiff ultimately did not prevail on his claim for lost profits, the time and money

spent pursuing that theory were reasonably related to and expended on the

litigation. In this regard, the Court notes that the very nature of the breach

committed by the government --- termination of a lease without proper notice ---

made calculating lost profits extremely difficult, as plaintiff was in the dark about

the termination for more than a year and a half. See Mann IV, 86 Fed. Cl. at 664–

65. Under such circumstances, reducing an attorney’s fees award due to the failure

to prove lost profits would allow the government “to reap advantage from [its] own

wrong.” Locke v. United States, 151 Ct. Cl. 262, 267 (1960). Nor is the Court

persuaded that plaintiff’s having proven fewer damages than sought makes the

number of hours spent by his attorney unreasonable in any way. Accordingly,

plaintiff is entitled to the full $212,898.75 in attorney’s fees he seeks for the merits

phase of the litigation.

Plaintiff also requests attorney’s fees incurred in the EAJA phase of the

litigation. Pl.’s Reply at 19–20. According to plaintiff, his attorneys spent a total of

120.2 hours preparing his EAJA application. Declaration of Stephen J. Lechner

¶¶ 2–4, Pl.’s Mem., Ex. E (“Lechner Dec.”); Pl.’s Reply at 19–20. It is well-

established that plaintiffs are entitled to recover attorney’s fees and expenses

incurred in preparing an EAJA application. See Hubbard v. United States, 480 F.3d

1327, 1331 (Fed. Cir. 2007); Filtration Dev. Co., 63 Fed. Cl. at 626. The government

does not appear to oppose the award of such fees. Moreover, plaintiff has provided

the court with sufficient itemized documentation to support his claim. See Lechner

Dec. ¶¶ 9–10; Second Declaration of Stephen Lechner ¶¶ 2–4, Pl.’s Reply, Ex. 5

(“Second Lechner Dec.”). Accordingly, the Court concludes that plaintiff is entitled

to the full amount of attorney’s fees he requests for the EAJA phase of this case.

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Multiplied by the statutory rate of $125 per hour, plaintiff would thus be entitled to

an additional $15,725.00 in attorney’s fees and costs.

2. Cost of Living Adjustment

Plaintiff requests that a cost of living adjustment (“COLA”) over and above

the statutory $125 per hour rate set by the EAJA be applied to the attorney’s fees

he requests. Pl.’s Mem. at 20. The EAJA explicitly contemplates such an

adjustment to the statutory cap on fees. See 28 U.S.C. § 2412(d)(2)(A)(ii)

(“[A]ttorney fees shall not be awarded in excess of $125 per hour unless the court

determines that an increase in the cost of living . . . justifies a higher fee.”). This

adjustment is measured from the effective date of the amended statutory cap ---

here, March 1996 --- until such time as services are rendered. See Doty, 71 F.3d at

387; Cal. Marine Cleaning v. United States, 43 Fed. Cl. 724, 734 (1999). While the

award of a COLA is made at the court’s discretion, see Filtration Dev. Co., 63 Fed.

Cl. at 625; KMS Fusion, 39 Fed. Cl. 593, 603 (1997), a plaintiff’s allegation of an

increase in the cost of living as measured by the Department of Labor’s Consumer

Price Index (“CPI”) is sufficient justification for such an award. See Filtration Dev.

Co., 63 Fed. Cl. at 625; see also Keeton Corr., Inc. v. United States, 62 Fed. Cl. 134,

139 (2004); Cal. Marine Cleaning, Inc., 43 Fed. Cl. at 733. Indeed, this Court has

“’decline[d] to impose a requirement that an applicant must do more than request

such an adjustment and present a basis upon which the adjustment should be

calculated.’” Filtration Dev. Co., 63 Fed. Cl. at 625 (quoting Cal. Marine Cleaning,

43 Fed. Cl. at 733).

The Court finds that plaintiff is entitled to a COLA to the statutory cap on

attorney’s fees. Plaintiff identifies March 1996 --- the effective date of the amended

statutory cap --- as the baseline, and calculates the COLA using a month-by-month

comparison between the March 1996 CPI and the CPI for each month during the

time the legal work was performed. Pl.’s Mem. at 21. Plaintiff then adjusts the

$125 statutory cap for each month based upon that difference, and multiplies the

adjusted monthly rate by the number of hours billed that month. Id. This is a

permissible method for calculating a COLA. See Carmichael v. United States, 70

Fed. Cl. 81, 86 (2006) (“An alternative method is to calculate the COLA month by

month by comparing the March 1996 CPI to the CPI for each month an attorney

billed hours. The court will then adjust the $125 cap for a given month by the

percent difference between the March 1996 CPI and that month’s CPI and calculate

the fees for that month by multiplying the number of hours billed by the adjusted

rate.”); see also Gonzalez v. United States, 44 Fed. Cl. 764, 771 (1999).

The government does not appear to oppose plaintiff’s request for a COLA or

his proposed calculation thereof. As such, the court concludes that plaintiff’s

requested attorney’s fees of $212,898.75 for the merits phase of litigation be

adjusted to $262,449.17, and the attorney’s fees of $15,025.00 for the EAJA phase of

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the litigation be adjusted to $20,732.32. Plaintiff is thus entitled to a total of

$283,881.49 in attorney’s fees.

3. Costs

Mister Mann identifies $65,757.63 in costs paid directly by him, see

Declaration of Stanley K. Mann ¶ 4, Pl.’s Mem., Ex. A (“Mann Dec.”), as well as an

additional $24,360.02 in costs incurred by his attorneys, see Lechner Dec. ¶¶ 7–8.

These costs include but are not limited to travel expenses, court reporter fees,

deposition and transcript costs, and filing fees. Lechner Dec. ¶ 7 and Ex. 3.

Additionally, plaintiff seeks reimbursement of the $700 fee he paid to his certified

personal accountant to prepare a Statement of Financial Condition, submitted as

evidence that his net worth did not exceed the statutory cap set by the EAJA of $2

million at the time the action was filed. Pl.’s Reply at 20 n. 14. The EAJA provides

examples of expenses that may be recovered by a prevailing party, see 28 U.S.C.

§ 2412(d)(2)(A), but that list is not exhaustive. See Oliveira, 827 F.2d at 744. A

plaintiff seeking an award of costs under the EAJA is required to submit supporting

documentation in the form of “an itemized statement . . . stating the actual time

expended and the rate at which fees and other expenses are computed.” 28 U.S.C.

§ 2412(d)(1)(B). Plaintiff has provided the Court with voluminous records

documenting the costs and fees incurred by him personally as well as by his

attorneys, including itemized statements showing the specific breakdown of time

spent, costs, and services provided. See Mann Dec., Exs. 1–3; Lechner Dec., Exs. 1–

6; Second Lechner Dec., Exs. A–C. The Court finds such documentation sufficient to

establish that plaintiff is entitled to reimbursement for his costs pursuant to the

EAJA.

Moreover, the government does not appear to contest the award of costs

except for those incurred in connection with expert witnesses Whittier and Crooks.

As explained above, however, the Court is not persuaded that Mr. Mann’s failure to

prevail under his lost profits theory justifies reducing the award, but rather finds

that the fees and costs associated with the claim for lost profits were reasonable.

Not only did the Court find the report of plaintiff’s experts sufficient to enable Mr.

Mann’s lost profits theory to survive summary judgment, see Mann III, 68 Fed. Cl.

at 669–70, but Mr. Whittier’s trial testimony was more persuasive than the

government’s expert and was necessary for the Court’s understanding of the

potential uses of the leased lands, see Mann IV, 86 Fed. Cl. at 664. That Mr.

Whittier ultimately failed to prove lost profits to the Court’s satisfaction does not

preclude reimbursement of his costs, see Baldi Bros. Constructors v. United States,

52 Fed. Cl. 78, 85–86 (2002), particularly when this failure was in large part due to

the nature of the government’s breach, see Mann IV, 86 Fed. Cl. at 664–65. The

Court thus finds that plaintiff is entitled to reimbursement of the full $90,817.65 in

costs he seeks, reduced only by those costs already awarded to plaintiff or

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disallowed by the Clerk of the Court pursuant to RCFC 54(d) and 28 U.S.C. §§ 1821

and 1920. 6 Plaintiff is thus entitled to $85,577.95 in costs.

III. CONCLUSION

For the foregoing reasons, the Court has determined that plaintiff has proven

attorney’s fees and costs consisting of the following amounts: $283,181.49 in

attorney’s fees, and $85,577.95 in costs. The government has not met its burden of

demonstrating that its position was substantially justified, and plaintiff is thus

entitled to an award of attorney’s fees and costs totaling $368,759.44. The Clerk of

the Court shall enter judgment for plaintiff on its application for attorney’s fees and

costs in the amount of $368,759.44.

IT IS SO ORDERED.

s/ Victor J. Wolski

VICTOR J. WOLSKI

Judge

6 The Clerk of the Court found plaintiff was entitled to $5,159.70 out of the total

$5,239.70 he requested: $120.00 for filing fees paid to the clerk; $148.50 for

duplication of papers; $3,315.15 for transcripts of court proceedings; $1,471.05 for

costs incidental to the taking of depositions; and $105.00 for the filing fee for his

appeal to the Federal Circuit. See Taxation of Costs at 1–3. The only cost

disallowed by the Clerk was part of plaintiff’s request for fees incident to the taking

of depositions, which exceeded the statutory cap of $40 per day per witness for each

day’s attendance. See 28 U.S.C. § 1821(b). Plaintiff’s request for $1,551.05 for fees

incident to the taking of depositions was thus reduced by $80.00, to $1,471.05. See

Taxation of Costs at 3.

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