Fastship, LLC v. United States

In the United States Court of Federal Claims

No. 12-484C

(Filed: June 27, 2019)

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) Patent case; motion for award of attorneys’

FASTSHIP, LLC, ) fees and expenses pursuant to 28 U.S.C. §

) 1498(a); prevailing plaintiffs; jurisdiction;

Plaintiff, ) standing; real party in interest; litigation-

) financing agreement; patent owners’ fee

v. ) agreements with counsel; findings regarding

) justification for the government’s position;

UNITED STATES, ) reasonable attorneys’ fees, expenses of expert

) witnesses, and costs

Defendant. )

)

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Mark L. Hogge, Dentons US LLP, Washington, D.C., for plaintiff. With him on the

briefs and at trial were Rajesh C. Noronha, Dentons US LLP, Washington, D.C., and Donald E.

Stout, Fitch, Even, Tabin & Flannery LLP, Washington, D.C.

Scott Bolden, Deputy Director, Intellectual Property Staff, Commercial Litigation

Branch, Civil Division, United States Department of Justice, Washington, D.C. With him on the

briefs were Joseph H. Hunt, Assistant Attorney General, Civil Division, and Gary L. Hausken,

Director, Intellectual Property Staff, Civil Division, United States Department of Justice,

Washington, D.C. Of Counsel was Andrew P. Zager, Department of the Navy, Washington,

D.C.

OPINION AND ORDER

LETTOW, Senior Judge.

In 2012, Plaintiff FastShip, LLC (“FastShip”) initiated litigation against the United States

(the “government”) for patent infringement by a class of littoral combats ships (“LCS”).1 After a

trial, FastShip prevailed on the merits of its infringement claim respecting the first of these ships,

LCS-1, USS Freedom, receiving an award of $6,449,585.82 as of September 6, 2006, plus

interest from that date. See FastShip, LLC v. United States, 131 Fed. Cl. 592, 627-28 (2017)

(“FastShip III”). The judgment was affirmed on appeal, with the amount of damages adjusted to

correct a transcription error, resulting in an award for infringement of $7,117,271.82, plus

interest for delay damages. FastShip, LLC v. United States, 892 F.3d 1298, 1310 (Fed. Cir.

2018) (“FastShip IV”). FastShip ultimately recovered $12.36 million for the infringement,

including delay damages. See Pl. FastShip, LLC’s Reply in Supp. of its Mot. for Attys’ Fees &

1

Littoral combat ships are highly maneuverable vessels designed for operations both in

ocean waters and near shore and are comparable in size to corvettes found in various navies.

Related Expenses (“Pl.’s Reply”) at 25, ECF No. 212. FastShip now moves for an award of

attorneys’ fees and related expenses pursuant to 28 U.S.C. § 1498(a) and submits a bill of costs

pursuant to Rule 54(d) of the Rules of the Court of Federal Claims (“RCFC”).

The government opposes an award of attorneys’ fees and expenses. First, the

government argues that due to a litigation financing agreement, FastShip is not a real party in

interest and therefore lacks standing to bring the claim for attorneys’ fees and costs. Second, the

government contends that its position during the litigation was reasonable and substantially

justified, precluding an award of attorneys’ fees and costs under 28 U.S.C. § 1498(a). Third, the

government argues that even if FastShip is entitled to an award of attorneys’ fees and costs, the

award requested is unreasonable and must be reduced. The court concludes that FastShip is and

has been the real party at interest in this litigation, and thus it has standing to bring a claim for

attorneys’ fees and costs. The court also finds that the government’s position during the

litigation was not substantially justified. Finally, the court concludes that FastShip’s request is

generally reasonable but must be reduced to eliminate certain inappropriate and unallowable

costs and excessive attorneys’ fees. Accordingly, FastShip’s request for expenses and attorneys’

fees is granted in part and denied in part.

BACKGROUND

A. Infringement of FastShip’s Patent, Trial, and Appeal

FastShip is the assignee of two patents, United States Patent Nos. 5,080,032 (“the ’032

patent”) and 5,231,946 (“the ’946 patent”). FastShip III, 131 Fed. Cl. at 598. These two patents

were originally filed by the inventor, David Giles, and are directed to and describe “a monohull

fast sealift [] or semi-planing monohull [] ship . . . whose hull design in combination with a

waterjet propulsion system permits, for ships of about 25,000 to 30,000 tons displacement . . .

[travel at] speeds of up to 40 to 50 knots in high or adverse sea states.” Id. at 598-99 (quoting

the ’032 patent, col. 1, lines 6-13; ’946 patent, col.1, lines 10-17). Put differently, the patents are

for ship designs that allow a large ship to travel at high speeds, despite difficult weather and sea

conditions. After being originally filed in the United Kingdom, the ’032 patent was issued by the

United States Patent Office on January 14, 1992, and the ’946 patent was issued on August 3,

1993. Id. at 599.

The conduct by the government that gave rise to this litigation started some years later.

In the early 2000s the Navy began “exploring the concept that later became the LCS program . . .

[,] seeking new ships that could be used for ‘focused missions’ at high speeds.” FastShip III,

131 Fed. Cl. at 600 (internal citation omitted). After an initial study that laid out program

performance parameters, the Navy issued a request for proposals for the LCS program in 2003.

Id. The Navy’s request did not specify a required hull design. Id.

During the initial phase of the LCS procurement, FastShip met with two government

contractors, Lockheed Martin and Gibbs & Cox, to “discuss FastShip’s potential contributions to

the team.” FastShip III, 131 Fed. Cl. at 601. Representatives for Lockheed Martin and Gibbs &

Cox told FastShip it was “unlikely” for the parties to engage in a direct arrangement for hull

design, but that it was possible to add FastShip “to the team for ‘certain design aspects.’” Id.

(citation omitted). About a month later, FastShip and the two government contractors “signed a

2

term sheet related to FastShip’s potential participation on the LCS team” that provided for

“information sharing between the LCS team and FastShip, subject to [] non-disclosure and

confidentiality agreements.” Id. at 601-02. Despite this agreement, FastShip was sidelined as

the design for the ship evolved through the procurement process and construction proceeded,

with the first ship, the LCS-1, being launched on September 23, 2006. Id. at 603. The

completed LCS-1 featured a semi-planing monohull. Id. at 602-03.

FastShip filed an adm

inistrative claim with the Navy in 2008, contending that the LCS program infringed upon their

patents and demanding compensation. FastShip LLC v. United States, 122 Fed. Cl. 71, 77

(2015) (“FastShip II”). The Navy replied two years later, stating it had investigated the claim

and believed the LCS program did not infringe FastShip’s patent. Id. The government denied

any compensation. Id. After receiving the Navy’s response, FastShip sent another letter

“reiterat[ing] the ‘allegations of patent infringement,’” before filing its complaint with this court

on August 1, 2012. Id.

The parties submitted briefs on claim construction of the patents at issue in August and

September of 2013 and held a technical primer for the court on August 27, 2013. FastShip, LLC

v. United States, 114 Fed. Cl. 499, 503-04 (2013) (“FastShip I”). The court then held a

Markman hearing on September 13, 2013 before issuing an opinion construing eight of the claim

terms on October 9, 2013. Id. at 504. The case thereafter proceeded with discovery until the

government moved for summary judgment respecting LCS-3 and subsequent Freedom class

ships. FastShip II, 122 Fed. Cl. at 77.2

The court granted the government’s motion with regard to LCS-3 and the subsequent

ships in the Freedom class, finding that these ships “were not ‘manufactured’ by or for the

government within the meaning of 28 U.S.C. § 1498 prior to the expiration of the patents in

suit.” FastShip II, 122 Fed. Cl. at 72, 86. This decision left only LCS-1 as the basis for

FastShip’s infringement claim. FastShip III, 131 Fed. Cl. at 607.

The court conducted a site visit at the constructing shipyard, visited the Carderock Naval

Test Basin, and then held a ten-day trial from October 3, 2016 to October 17, 2016. FastShip III,

131 Fed. Cl. at 607. After post-trial briefing and closing argument, the court issued its decision

on April 28, 2017. See generally id. at 592. The court found that the claims from the ’032 and

’946 patents were valid and directly infringed by the government in its construction of the LCS-

1. Id. at 618. It awarded FastShip $6,449,585.82 in damages as of September 23, 2006, the

launch date of LCS-1. Id. at 627. The court also held that FastShip was entitled to interest for

the delayed compensation from the launch date and could apply for “reasonable costs and

reasonable fees for witnesses and attorneys under 28 U.S.C. § 1498(a) . . . within 30 days after

any appellate process has been concluded.” Id. at 627-28.

2

The Freedom class of LCS are designated as LCS-1, 3, 5, 7, 9, 11, et al., taking into

account the design and construction of a second class of littoral combat ships, the Independence

class, designated as LCS-2, 4, 6, et al.

3

An appeal followed. See Fastship IV, 892 F.3d 1298. In its decision, the Federal Circuit

affirmed the decision of this court to find infringement by the LCS-1, affirmed a grant of

summary judgment that LCS-3 was not “manufactured” within the meaning of 28 U.S.C. §

1498(a) before the expiration of the patents-in-suit, and modified the damage amount due to a

transcription error. See id. at 1310. The Federal Circuit also held that “[e]ach party shall bear its

own costs” for the appeal. Id. at 1311.

B. Costs and Fees Requested Pursuant to 28 U.S.C. § 1498(a)

After prevailing on the appeal, FastShip filed a motion for attorneys’ fees and related

expenses (“Pl.’s Mot.”), ECF No. 190, and a bill of costs (“Pl.’s Bill of Costs”), ECF No. 191, on

October 4, 2018. Both the motion for attorneys’ fees and related expenses and the bill of costs

have 30 attachments, 29 of which are identical. Compare Pl.’s Mot. with Pl.’s Bill of Costs. The

first, and only different, attachments are memoranda in support of FastShip’s motion for

attorneys’ fees and related expenses, ECF No. 190-1 (“Pl.’s Br.”), and bill of costs, ECF No.

191-1 (“Pl.’s Cost Br.”). The second attachment, identical in both motions, is a declaration by

Rajesh C. Noronha, ECF Nos. 190-2, 191-2 (“Noronha Decl.”), a “Senior Managing Associate”

at Dentons and one of the counsels for FastShip. Mr. Noronha’s declaration also provides an

index to the remaining 28 attachments, which are identified as exhibits and support FastShip’s

motion for attorneys’ fees and related expenses and bill of costs. Id.3

Exhibit 1 in both motions, but apparently only relevant to the motion for attorneys’ fees

and related expenses, is a declaration by FastShip’s counsel of record, Mr. Mark L. Hogge,

attesting to the reasonableness and accuracy of the request. PX 1. In his declaration, Mr. Hogge

states that he provided “the manager of FastShip, LLC, with an invoice for our legal services

usually on a monthly basis, setting forth the time devoted to the representation, and the billing

rates charged by each timekeeper and maintained a running total of fees incurred.” PX 1 at 2-3.

Exhibit 1 also contains sub-exhibits. Sub-exhibit 1-A is a copy of the engagement agreement

between Dentons and FastShip. Id. at 2. Sub-exhibit 1-B is a lengthy example of the extensive

document production that characterized this litigation. Id. at 3. Sub-exhibit 1-C is a worksheet

listing the time entries and detailing the work done on the litigation from July 22, 2012 to

September 30, 2018, totaling $6,988,906.80. Id. These entries do not separately state the hourly

rate charged, nor do they provide an overall summary of the hours charged, either in total or by

the individual attorney. See id. Mr. Hogge states that he “reviewed and edited” the time entries.

Id. Finally, Sub-exhibit 1-D separately lists the fees incurred for the summary judgment motion

on the LCS-3 and the later Freedom class ships, totaling $498,809.70. Id.

3

FastShip’s exhibits will be referred to as “PX __ at ___,” reflecting the exhibit number

and sub-exhibit designatiors, followed by the page number.

FastShip switched their designation of exhibits from numbers to double letters for the

12th exhibit, i.e., what would be Exhibit 12 is actually Exhibit AA.

4

Exhibits 2 through 11 provide declarations by counsel of record attesting to the

reasonableness of the fees requested, copies of litigation documents such as answers to

interrogatories and deposition transcripts, and outside support for the level of fees charged, e.g.,

surveys conducted by the American Intellectual Property Law Association (“AIPLA”) showing

attorneys’ fees an intellectual property litigation by area of the country for given years.4 Exhibits

AA through QQ provide copies of various invoices that FastShip’s counsel issued while

litigating this case.5

In all, FastShip originally asked for $8,724,475.22 in combined attorneys’ fees and

related expenses, Pl.’s Br. at 53, comprised of $6,988,906.80 of attorneys’ fees and

$1,735,568.42 of fees for expert witnesses, id. at 43-44. FastShip also requests $2,430,047.71 in

its bill of costs. Pl.’s Cost Br. at 57.

FastShip filed two supplements to its original requests for attorneys’ fees and related

expenses and bill of costs. The first, a supplemental memorandum filed on December 4, 2018,

included invoices for Dr. Richard Garwin (PX RR) and increased the amount of fees requested

for his services from the original $180,610.66 to $196,264.75, raising the total attorneys’ fees

and related expenses to $8,740,129.31. Pl.’s Suppl. Mem. in Supp. of Its Mot. for Atty’s’ Fees &

4

Exhibit 2 is the declaration of Donald L. Stout in support of the reasonable cost

application (PX 2); Exhibit 3 is the declaration of Raymond H. Lemisch in support of the

reasonable cost application (PX 3); Exhibit 4 is the declaration of Howard Brod Brownstein in

support of the reasonable cost application (PX 4); Exhibit 5 is the declaration of Roland K.

Bullard, II, certifying the small entity status of FastShip (PX 5); Exhibit 6 is the declaration of

David Giles in support of the reasonable cost application (PX 6); Exhibit 7 is a copy of the

transcript of the deposition of Captain Casey Moton (PX 7); Exhibit 8 is a copy of the

“Defendant’s Responses to Plaintiff FastShip, LLC’s Second Set of Interrogatories” (PX 8);

Exhibit 9 is a copy of the transcript of the deposition of Dr. Frederick Stern (PX 9); Exhibit 10 is

a copy of a two page excerpt from the “AIPLA 2017 Report of the Economic Survey” (PX 10);

and Exhibit 11 is a copy of the USAO Attorney’s Fees Matrix for 2015 to 2019 (PX 11).

5

Exhibit AA is a copy of certain A2L Consulting” invoices (PX AA); Exhibit BB is a

copy of certain “Above the Wave” invoices for Michael R. Bagdon (PX BB); Exhibit CC is a

copy of certain “Aquipt” invoices (PX CC); Exhibit DD is a copy of certain “Brynteson

Reporting, Inc.” invoices (PX DD); Exhibit EE is a copy of certain “Capitol Process Services,

Inc.” invoices (PX EE); Exhibit FF is a copy of certain “DTI” invoices (PX FF); Exhibit GG is a

copy of certain “For the Record, Inc.” invoices (PX GG); Exhibit HH is a copy of certain

“GreatBridge Consulting, Inc.” invoices (PX HH); Exhibit II is a copy of certain “Gregory

Edwards, LLC” invoices (PX II); Exhibit JJ is a copy of certain “In Data Corp.” invoices (PX

JJ); Exhibit KK is a copy of certain “LightSpeed LLC” invoices (PX KK); Exhibit LL is a copy

of certain invoices for “Chris B. McKesson, PE” (PX LL); Exhibit MM is a copy of certain

“Summit Global” invoices (PX MM); Exhibit NN is a copy of certain “Thornycroft, Giles &

Associates” invoices (PX NN); Exhibit OO is a copy of certain “TSG Reporting” invoices (PX

OO); Exhibit PP is a copy of certain “miscellaneous travel, expense and food invoices addressed

to FastShip and its counsel in this case” (PX PP); and Exhibit QQ is a copy of “the summary of

PACER charges incurred for certain client matters of Dentons US LLP” (PX QQ).

5

Related Expenses (“Pl.’s Suppl. Mem.”), ECF No. 196. The second, filed on the same day,

provided additional documentation (PX SS) for FastShip’s requests for costs related to the

services of Summit Global. Pl.’s Suppl. Mem. in Supp. of Its Bill of Costs, ECF No. 197

(Summit Global’s original invoices are contained within PX MM).

The government responded on December 28, 2018. See Def.’s Objs. to FastShip, LLC’s

Bill of Costs (“Def.’s Objs.”), ECF No. 201; Def.’s Resp. to FastShip, LLC’s Mot. for Atty’s’

Fees (“Def.’s Resp.”), ECF No. 203. In the responses, the government contends FastShip should

not be granted attorneys’ fees, related expenses, or costs primarily because the government’s

position throughout the litigation was substantially justified. See, e.g., Def.’s Resp.; Def.’s Objs.

But assuming the court decides to award attorneys’ fees and related expenses, the government

contends that several of the fees charged by FastShip’s counsel and expert witnesses should be

reduced or disallowed for a variety of reasons. As for the bill of costs, the government does not

dispute $1,226,372.91 of the costs alleged by FastShip. Def.’s Objs. at 5-6. The government

disputed the remaining $1,203,248 for three reasons. See id. at 6-11. First, the government

argues FastShip is not entitled to $546,372.91 of costs related to its bankruptcy and the

management of the liquidating trust. Id. at 6-8. Second, the government contests FastShip’s

request for $637,389.38 of “U.S. Living Expenses” for Mr. Giles over a period of six years. Id.

at 8-11. Third, and finally, the government contests $19,486 FastShip requests for costs related

to its appeal to the Federal Circuit. Id. at 11-12.

FastShip replied to both of the government’s responses on March 8, 2019. See Pl.’s

Reply in Supp. of its Bill of Costs (“Pl.’s Bill of Cost Reply”), ECF No. 211; Pl.’s Reply; Pl.’s

Second Suppl. Mem., ECF No. 213. In its response to the government’s objections to its bill of

costs, FastShip agreed to withdraw the $546,372.91 in requests for costs related to its

bankruptcy. Pl.’s Bill of Costs Reply at 6. FastShip also withdrew the $637,389.38 request for

living expenses for David Giles. Id. FastShip maintained its request for costs related to the

appeal to the Federal Circuit and increased its requested costs of $19,486 to $33,450.30. Id. at 4-

5.

A hearing was held on April 3, 2019. FastShip responded on June 12, 2019, to the

court’s order regarding clarification of aspects of the attorneys’ fees requested. See Pl. FastShip,

LLC’s Resp. to the Court’s Order of June 5, 2019 (Pl.’s Resp.”), ECF No. 220.

STATUTORY AUTHORIZATION: 28 U.S.C. § 1498(a)

Section 1498(a) of Title 28 permits a patent holder to sue the United States for patent

infringement, stating:

“Whenever an invention described in and covered by a patent of the United

States is used or manufactured by or for the United States without license of

the owner thereof or lawful right to use or manufacture the same, the owner’s

remedy shall be by action against the United States in the United States Court

of Federal Claims for the recovery of his reasonable and entire compensation

for such use and manufacture.”

28 U.S.C. § 1498(a).

6

Litigation fees and expenses are at issue at this juncture. Prior to 1996, “reasonable and

entire compensation” had not been delineated by the statute. E.g., 28 U.S.C. § 1498(a) (1994).

Courts previously interpreted the phrase to mean “just compensation” as “required by the Fifth

Amendment for government takings by eminent domain.” H.R. Rep. No. 104-373, at 2 (1995),

1996 U.S.C.C.A.N. 4173, 4174 (citing Waite v. United States, 282 U.S. 508, 509 (1931)). The

Fifth Amendment, however, does not itself require the United States to pay litigation expenses in

eminent domain cases; “such fees and costs can only be authorized by statute.” Id. (citing United

States v. Bodcaw Co., 440 U.S. 202, 203 (1979)). Although Congress authorized “legal fees and

costs in cases related to the taking of real property [under] the ‘Uniform Relocation Assistance

and Real Property Acquisition Policies Act of 1970,’ . . . [n]o such provision exist[ed] [prior to

1996] . . . in the case where the government is found liable for taking a patent.” Id. (citing the

Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (“Uniform

Relocation Act,” 42 U.S.C. § 4654, and Calhoun v. United States, 453 F.2d 1385, 1395-96 (Ct.

Cl. 1972)). Further, as of 1995 “[n]o [patent] owner ha[d] yet been able to recover any of its

litigation costs under the [Equal Access to Justice Act],” id., 1996 U.S.C.C.A.N. at 4174, and

this court had held in 1993 that the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412, did

not apply to patent owners suing the government under 28 U.S.C. § 1498(a), see de Graffenried

v. United States, 29 Fed. Cl. 384, 386-88 (1993).

Endeavoring to “help small business, independent inventors and nonprofit organizations

recover the legal costs associated with defending their patents when the [f]ederal government is

found liable for taking and using them,” Congress amended 28 U.S.C. § 1498(a) in 1996 to

define “‘reasonable and entire compensation’ to include attorney’s fees and costs.” H.R. Rep.

No. 104-373, at 1-2, 6, 1996 U.S.C.C.A.N. at 4174-75, 4178; see also Pub. L. No. 104-308, 110

Stat. 3814 (1996) (amending 28 U.S.C. § 1498(a)). Attorneys’ fees and costs were made

available for patent owners who are either “independent inventor[s], a nonprofit organization, or

an entity that had no more than 500 employees at any time during the 5-year period preceding

[infringement by the United States].” 28 U.S.C. § 1498(a). While the original proposal in the

House of Representatives conditioned attorneys’ fees and costs solely on finding the government

liable, see 141 Cong. Rec. 36,190 (1995) (statement of Rep. Moorhead), the bill as enacted after

a Senate amendment allowed the government to avoid paying attorney’s fees and costs if the

court found either that “the position of the United States was substantially justified or that special

circumstances make an award unjust,” 28 U.S.C. § 1498(a); see also 142 Cong. Rec. 27,243

(1996) (statement of Sen. Lott) (proposing amendment to H.R. 632). In its current form, 28

U.S.C. § 1498(a) now reads:

“Reasonable and entire compensation shall include the owner’s reasonable

costs, including reasonable fees for expert witnesses and attorneys, in

pursuing the action if the owner is an independent inventor, a nonprofit

organization, or an entity that had no more than 500 employees at any time

during the 5-year period preceding the use or manufacture of the patented

invention by or for the United States. Not[]withstanding the preceding

sentences, unless the action has been pending for more than 10 years from the

time of filing to the time that the owner applies for such costs and fees,

reasonable and entire compensation shall not include such costs and fees if the

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

that special circumstances make an award unjust.”

7

28 U.S.C. § 1498(a).

JURISDICTION & STANDING

A. FastShip is a Qualifying Successful Plaintiff

FastShip prevailed on its infringement claim, FastShip III, 131 Fed. Cl. 592, and both

parties agree that FastShip qualifies under the size limits imposed by the statute, see Def.’s Objs.

at 3.

B. Post-Appellate Jurisdiction over the Claim for Attorneys’ Fees and Expenses

In its post-trial opinion, this court directed “judgment pursuant to RCFC 54(b) respecting

the reasonable and entire compensation for infringement,” and allowed FastShip to apply for

costs and attorneys’ fees as allowed by 28 U.S.C. § 1498(a) following the end of any appellate

process. FastShip III, 131 Fed. Cl. at 627-28 (emphasis added). The question of whether the

court may act under 28 U.S.C. § 1498(a) to first award compensation for the government’s

unauthorized use and then award the owner’s costs in successfully pursuing an infringement

action was addressed as an issue of first impression in a decision by this court, Hitkansut LLC v.

United States, 142 Fed. Cl. 341 (2019). In Hitkansut, the court held that it

“finds nothing within the text of 28 U.S.C. § 1498(a), appearing either

expressly or arising inferentially from a natural reading, or among

interpretations of similar statutes, that deprives this court of the ability to

make an award of fees and expenses separate from an award of compensation

regarding infringement. Accordingly, this court concludes that it retains

jurisdiction under the statute to adjudicate Hitkansut’s motion for fees and

costs.”

Hitkansut, 142 Fed. Cl. at 345. Here, unlike Hitkansut, the government does not pose a

challenge to FastShip’s ability to bring a claim for attorneys’ fees and costs after an appeal on

the merits regarding infringement.6 The court follows Hitkansut and holds that it retains

jurisdiction to hear FastShip’s claim for attorneys’ fees and costs under 28 U.S.C 1498(a).

C. Standing – Real Party in Interest

What the government does challenge, however, is whether FastShip is a real party in

interest due to a litigation financing agreement. See Hr’g Tr. 34:15 to 42:17 (Apr. 3, 2019).7

The government “believe[s] that the court should . . . reject costs and fees in this particular case

6

The government does briefly acknowledge that the issue exists. See Def.’s Objs. at 11;

Def.’s Resp. at 34 n.20.

7

Subsequent references to the hearing will omit the date.

8

because FastShip is not the real party in interest.” Hr’g Tr. 34:17-20. Instead, the government

argues that “IPCo. is the real party in interest,” Hr’g Tr. 37:19-21, and that due to “other factors .

. . [such as] the relationship [between IPCo., Dentons, and FastShip], [] the apparent non-arm’s-

length transactions as far as invoicing [, and] the magnitude of the contingent fee,” the request

for attorneys’ fees and costs is “outside the realm of reasonableness,” Hr’g Tr. 39:12-17.

Because standing to bring a motion for attorneys’ fees and costs after a successful claim for

patent infringement against the United States is a relatively novel issue, the court will first

examine standing for attorneys’ fees under 28 U.S.C. § 1498(a) generally before turning to

litigation financing agreements specifically.

1. Standing for attorneys’ fees under 28 U.S.C. 1498(a) generally.

As a preliminary matter, the court in Hitkansut noted that the Court of Appeals for the

Federal Circuit has held that “[g]enerally, ‘awards of attorneys’ fees where otherwise authorized

are not obviated by the fact that individual plaintiffs are not obligated to compensate their

counsel [because] an attorney-client relationship suffices to entitle prevailing litigants to receive

fee awards.’” Hitkansut, 142 Fed. Cl. at 353 (quoting Ed A. Wilson, Inc. v. General Servs.

Admin., 126 F.3d 1406, 1409 (Fed. Cir. 1997)) (in turn quoting Rodriguez v. Taylor, 569 F.2d

1231, 1245 (3d Cir. 1977)). The court found support for its interpretation from three other fee-

shifting statutes, which indicated that a contingency arrangement should not bar recovery of

attorneys’ fees. Id. at 353-54.

First, the court turned to the Back Pay Act for guidance. See Hitkansut, 142 Fed. Cl. at

353.

The Back Pay Act provides that a government employee who is wrongfully

deprived pay ‘is entitled, on correction of the personnel action, to receive . . .

reasonable attorney fees . . . [that] shall be awarded in accordance with the

standards established under § 7701(g) of this title.’ 5 U.S.C. § 5596(b)(1)(A).

Section 7701(g), in turn, requires, among other things, that the fees awarded

be ‘incurred’ by the employee, 5 U.S.C. § 7701(g)(1), or be awarded ‘as part

of the costs,’ 42 U.S.C. § 2000e-5 (cited by 5 U.S.C. § 7701(g)(2)).

Id.; see also Raney v. Federal Bureau of Prisons, 222 F.3d 927, 934 (Fed. Cir. 2000)

(“[R]estrict[ing] ‘reasonable attorney fees incurred’ to ‘reasonable attorney fees actually

incurred’ constitutes precisely the type of legislative rewrite that any court should avoid. It

imposes a limitation which Congress neither expressed nor intended.”) (internal citations

omitted).

The court next turned to EAJA for guidance. See Hitkansut, 142 Fed. Cl. at 354. Similar

to the Back Pay Act, EAJA permits a court to “award reasonable fees and expenses of attorneys”

and “fees and expenses . . . incurred by that party . . . .” Id. (citing 28 U.S.C. § 2412(b),

(d)(1)(A) (emphasis added)). The court found support for this interpretation, i.e., that the

plaintiff “incurred” attorneys’ fees under EAJA despite its “insurer being responsible for paying

them,” from the Federal Circuit’s holding in Ed A. Wilson, Inc. Id. (quoting Ed A. Wilson, 126

F.3d at 1409) (“[I]t is well-settled that an award of attorney fees is not necessarily contingent

upon an obligation to pay counsel. Generally, awards of attorneys’ fees where otherwise

9

authorized are not obviated by the fact that individual plaintiffs are not obligated to compensate

their counsel.”).

Finally, the court examined the Uniform Relocation Act. Hitkansut, 142 Fed. Cl. at 354.

In contrast to EAJA or the Back Pay Act, the attorneys’ fees provision of the Uniform Relocation

Act requires the court to “reimburse [the] plaintiff for his reasonable costs, disbursements, and

expenses . . . actually incurred because of such proceeding.” Id. (citing 42 U.S.C. § 4654(c)). In

Washington Metro. Area Transit Auth. v. United States, 57 Fed. Cl. 148, 152-53 (2003), this

court held that the use of “reimburse” and “actually incurred” in the Uniform Relocation Act

distinguished that statute from the Back Pay Act as interpreted by the Federal Circuit in Raney.

Accordingly, the court restricted attorneys’ fees to those actually incurred by the plaintiff. Id.

This court has applied similar reasoning in other cases under the Uniform Relocation Act. E.g.,

Lost Tree Vill. Corp. v. United States, 135 Fed. Cl. 92, 98-99 (2017) (allowing reimbursement of

fees actually paid by the plaintiff but rejecting a “success fee” that was contractually recoverable

only from the “government as part of the reasonable attorney’s fees” owed to the plaintiff); but

see Shelden v. United States, 41 Fed. Cl. 347, 357 (1998) (construing the Uniform Relocation

Act to be comparable to EAJA).

2. FastShip’s litigation financing agreement with IPCo.

In this case, an unrelated third-party (IPCo.) provided an initial payment of $600,000 to

plaintiff’s primary counsel of record (Dentons). Hr’g Tr. 35:19-25. Adding further difficulty is

the fact that one of the attorneys of record for FastShip, Mr. Donald Stout, is also a “Joint

Member and Manager” of IPCo. See Def.’s Resp. at 36; PX 2 at 2.8 In short, one of the parties

that was financing the litigation was managed by one of the attorneys who worked on the case.

The concern of the government, then, is that the transactions were not at arm’s length, i.e., that

the fees are “from one counsel of record to the other counsel of record.” Def.’s Resp. at 37.

FastShip counters that it is “the real party in interest” because it is comprised of a “group of

shareholders that continue to work in their area.” Hr’g Tr. 61:13-18. It further contends that

Dentons did not have a relationship with IPCo. beyond the initial retainer. Hr’g Tr. 62:15-19.

FastShip also avers that Mr. Stout was an integral member of the trial team, not a silent partner.

Hr’g Tr. 61:19-24.

The subject of litigation financing is a controversial one. Several circuits around the

country have amended their local rules to require disclosure of litigation financing agreements

with third parties that have a financial interest in the outcome.9 These rules, however, are

8

Mr. Stout is also the Registered Agent for IPCo. PX 2 at 2-3 (Stout Decl.).

9

See, e.g., 3rd Cir. L.A.R. 26.1.1(b) (“Every party to an appeal must identify on the

disclosure statement required by [Federal Rule of Appellate Procedure] 26.1 every publicly

owned corporation not a party to the appeal, if any, that has a financial interest in the outcome of

the litigation and the nature of that interest.”) (emphasis added); 4th Cir. R. 26.1(a)(2)(B) (“A

party must identify any publicly held corporation . . . that has a direct financial interest in the

outcome of the litigation by reason of a franchise, lease, [or] other profit sharing agreement.”)

(emphasis added); 5th Cir. R. 28.2.1 (Counsel . . . must certify a complete list of all [parties] who

or which are financially interested in the outcome of the litigation); 6 Cir. R. 26.1(b)(2)

10

focused on disclosure and transparency; they do not ban or disfavor litigation financing

agreements. Indeed, the government concedes as much. See Hr’g Tr. 38:9 to 39:23.

Regardless, this court has not yet adopted any rules regarding litigation financing

agreements. Yet, even if this court had adopted a local rule mandating the disclosure of

litigation financing agreements, the court is, and has been, aware of IPCo.’s role in the litigation.

As the involvement of Mr. Stout makes evident, at no point was the court in the dark regarding

his status.

In addition, nothing about Mr. Stout’s role as a counsel of record and litigation financer

suggests that a conflict exisits. These two roles are independent of one another and there is no

evidence in the record that Mr. Stout acted improperly. FastShip represents that Mr. Stout was

an integral member of a “lean[]” trial team and one of three individuals who conducted

depositions. Hr’g Tr. 61:19 to 62:1. Mr. Hogge also stated that he “made it a requirement that

[Mr. Stout] help [him] try this case” because of their long experience trying jury cases “opposite

each other” over the last “20 years.” Hr’g Tr. 61:19-24. FastShip argues that Dentons, the

counsel of record, did not “have a relationship with IPCo. . . . We didn’t sign any agreement.

We don’t bill IPCo. We never did. And we just looked to IPCo. to cover the expenses.” Hr’g

Tr. 62:15-19.

The very point of fee-shifting statutes is to permit small entities, i.e., ones that could not

normally survive the gauntlet of litigation, to assert their rights. See, e.g., Commissioner, I.N.S.

v. Jean, 496 U.S. 154, 163 (1996); Raney, 222 F.3d at 935. Suing the United States government

is a daunting task. It is an opponent with vast resources and a legion of highly skilled attorneys

at its disposal. Even with the assistance of shifted or contingent fees, claims may fall into the

gray area of uncertainty and cannot attract counsel. Litigation financing agreements help bridge

this divide by providing the attorney of record a source of guaranteed fees for their work, while

granting the financer a share of the proceeds if the case is successful. Here, IPCo. acted as that

bridge, covering the gap between claim and litigation, allowing FastShip to successfully pursue

their infringement case. Preventing recovery based on such an agreement would be anathema to

the underlying purpose of fee-shifting statutes.

Like the patent system as a whole, litigation financing agreements can occasionally be

susceptible to abuse. See, e.g., In re Packard, 751 F.3d 1307, 1325 & n.21 (Fed. Cir. 2014)

(discussing “patent trolls” and how they waste scarce judicial resources with unworthy claims);

see also Derek Thompson, The Most Expensive Comment in Internet History?, The Atlantic

(Feb. 23, 2018), https://tinyurl.com/yy62a4l5 (detailing the dark campaign by Peter Thiel to

(“Whenever . . . a publicly owned corporation or its affiliate, not a party to the appeal, nor an

amicus, has a substantial financial interest in the outcome of litigation, counsel for the party . . .

shall advise the clerk.”) (emphasis added); 10th Cir. R. 46.1(D)(1) & (2) (“Each entry of

appearance must be accompanied by a certificate listing the names of all interested parties not in

the caption . . . . [T]he certificate must list all [parties] that are financially interested in the

outcome of the litigation.”) (emphasis added); 11th Cir. R. 26.1-1(a)(1), -2(a) (“Every party and

amicus curiae [] must include a certificate . . . [that] must contain a complete list of all [parties]

that have an interest in the outcome of the particular case.”) (emphasis added). Various district

courts have adopted similar local rules.

11

destroy a gossip website using secretly funded litigation). But the possibility of abuse does not

mean the entire system should be discarded. Instead, courts have focused on the disclosure of

such agreements to encourage transparency and ensure a shadow broker is not using litigation as

a form of harassment or for multiple bites at the same apple. Disclosure also enables judges to

appropriately evaluate potential recusal due to conflicts of interest.

At bottom, FastShip will need to pay Dentons for its legal representation in this litigation.

That payment, if attorneys’ fees and expenses are not awarded, would reduce the recovery

received by FastShip for the infringement. Thus, as the Federal Circuit and this court have

routinely held, “in this sense, ‘[a plaintiff who must turn over any fee award to the attorney per

their agreement] incurs the attorney fees that may be awarded.’” Hitkansut, 142 Fed. Cl. at 354

(quoting Phillips v. General Servs. Admin., 924 F.2d 1577, 1582 (Fed. Cir. 1991)).

For the reasons stated, the court finds that FastShip is the real party in interest and has

standing to bring a motion for attorneys’ fees and costs.

ANALYSIS

At issue is the “reasonable and entire compensation” available to a qualifying plaintiff

who has made a successful showing that the United States infringed upon an owner’s patent. 28

U.S.C. § 1498(a). That compensation “shall include the owner’s reasonable costs, including

reasonable fees for expert witnesses and attorneys.” Id. To obtain an award, the court must find

that the position held by the United States was not “substantially justified or that special

circumstances would make an award unjust.” Id. There is an exception, however, that allows

the court to award attorneys’ fees and costs regardless of whether the United States was

substantially justified if “the action has been pending for more than 10 years from the time of

filing to the time that the owner applies for such costs and fees.” Id. In short, a successful

plaintiff is eligible for attorneys’ fees and costs under 28 U.S.C. 1498(a) if the plaintiff

demonstrates that the action has been pending for more than ten years or if the government does

not carry its burden of that showing that it was substantially justified.

I. Whether This Action Has Been Pending For More Than 10 Years

In its brief, FastShip attempts to short-circuit the substantially-justified analysis by

arguing that its request for attorneys’ fees and costs satisfies the 10 year exception of 28 U.S.C. §

1498(a). See Pl.’s Br. at 11-14 (citing 28 U.S.C. 1498(a)). FastShip does not contend that they

filed their complaint with this court more than 10 years ago. Rather, FastShip argues that

because it filed its administrative claim notifying the Navy of infringement in 2008, and because

“the pre-suit conduct of the [g]overnment during an administrative claim is relevant to . . .

[whether] the [g]overnment’s position is justified for the purposes of assessing whether

attorney[s’] fees and related expenses should be awarded,” the 2008 administrative claim should

be considered the “action” under 28 U.S.C. 1498(a). Pl.’s Br. at 13.10

10

FastShip also cites the tolling provisions of 35 U.S.C. § 286 (as applicable to 28 U.S.C.

§ 2501) as analogous support for its proposition.

12

The government counters that the “plain language” of 28 U.S.C. 1498(a) needs no

elaboration and that the “‘the action’ was pending for six years, two months and four days, which

is [] less than ten years.” Def.’s Resp. at 6-7. According to the government, the court “must

evaluate whether the [g]overnment’s ‘position’ was ‘substantially justified,’ before it can award

attorney and expert witness fees.” Id. at 8 (citing 28 U.S.C. § 1498(a)).

The court does not find FastShip’s argument to be persuasive. Nothing in the statute

allows for consideration of administrative claims. Instead, the statute states that the exception

only applies when the “action has been pending for more than 10 years.” 28 U.S.C. § 1498(a)

(emphasis added). And the “action” is specified in the subsection by the earlier reference that

the “owner’s remedy shall be by action against the United States in the United States Court of

Federal Claims for the recovery.” 28 U.S.C. § 1498(a). Thus to be an “action” eligible for the

10-year exception, it must be one filed with this court. Here, FastShip filed their complaint with

this court on August 1, 2012, and filed their petition for attorneys’ fees on October 4, 2018. See

Compl.; Pl.’s Br. As the government notes, this is six years, two months, and four days apart –

well short of the 10 years as required by 28 U.S.C. 1498(a). Under established principles of

statutory interpretation, see, e.g., Babbitt v. Oglala Sioux Tribal Pub. Safety Dep’t, 194 F.3d

1374, 1378-79 (Fed. Cir. 1999), the court cannot override by inference what is made explicit in

the statute. Thus, the court finds that the action in this case has been pending for less than 10

years and therefore must turn to whether the government’s position was substantially justified to

determine whether attorneys’ fees and expenses are available.

II. Whether The Government’s Position Was Substantially Justified

As a qualifying prevailing plaintiff, FastShip is entitled to an award of its costs, to

include “fees for expert witnesses and attorneys” if “reasonable . . . in pursuing the action”

unless “the position of the United States was substantially justified or [] special circumstances

make an award unjust.” 28 U.S.C. § 1498(a).

A. “Substantially Justified”

The statute does not define when the government’s position is substantially justified, and

neither the Supreme Court nor the Court of Appeals for the Federal Circuit have interpreted

“substantially justified” in the context of 28 U.S.C. § 1498(a). Nonetheless, in Hitkansut, the

court concluded that the “substantially justified” language of 28 U.S.C. 1498(a) should be

interpreted in the same manner as the “substantially justified” language in EAJA. Hitkansut, 142

Fed. Cl. at 356. The court based this on a previous decision that “interpreted the term in a

manner consistent with EAJA,” id. (citing Wright v. United States, 56 Fed. Cl. 350, 352 (2003)),

and on the “limited legislative history,” id. (citing H.R. Rep. No. 104-373, at 2-3, 7, 1996

U.S.C.C.A.N. at 4174-75, 4179; 142 Cong. Rec. 27,243 (1996)).11 The court thus adopts

EAJA’s interpretation of “substantially justified” for purposes of 28 U.S.C. 1498(a).

11

The legislative history on the “substantially justified” language is thin. The original bill

amending 28 U.S.C. § 1498(a) in the House of Representatives was “not conditioned upon ‘the

government’s litigation position [not being] substantially justified.’” Hitkansut, 142 Fed. Cl. at

356 (citing H.R. Rep. No. 104-373, at 7, 1996 U.S.C.C.A.N. at 4179 (mentioning EAJA and the

13

Under EAJA, the government’s position is “substantially justified” when it is “justified in

substance or in the main – that is, justified to a degree that could satisfy a reasonable person,

[which is] no different from the ‘reasonable basis both in law and fact’ formulation.” Pierce v.

Underwood, 487 U.S. 552, 565 (1988) (internal quotation marks omitted) (citations omitted).

The court’s inquiry must “focus[] on the governmental misconduct giving rise to the litigation,”

Jean, 496 U.S. at 165, and must examine “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) (footnotes omitted). And, as the

court previously concluded “[t]he government bears the burden of demonstrating that its position

was substantially justified.” Hitkansut, 142 Fed. Cl. at 356 (quoting Wright, 56 Fed. Cl. at 352

(in turn citing Doty v. United States, 71 F.3d 384, 385 (Fed. Cir. 1995)).

B. The Government’s Pre-Litigation Conduct

The government contends that its pre-litigation conduct should have no bearing on

whether its position in the litigation was substantially justified. Def.’s Resp. at 9-11. In its brief,

the government argues that “[28 U.S.C.] § 1498 does not include EAJA’s definition of ‘position

of the United States,’ nor is there any suggestion that Congress intended to waive sovereign

immunity for pre-litigation conduct when it amended that section to permit awards of attorneys’

fees.” Id. at 10. FastShip, on the other hand, argues that the government’s pre-litigation conduct

should be considered in determining whether or not the government was “substantially justified.”

See Pl.’s Br. at 13-18. It contends that “the pre-suit conduct of the [g]overnment during an

administrative claim is relevant to the consideration of whether . . . attorney[s’] fees and related

expenses should be awarded.” Id. at 13.

The government made similar arguments in Hitkansut regarding its pre-litigation

conduct. The court rejected those arguments then, Hitkansut, 142 Fed. Cl. at 356-58, and does so

now:

The text of 28 U.S.C. § 1498(a) refers to a single ‘position of the United

States.’ The statute makes no distinction between the pre-litigation position

and the position taken once litigation commences. There is nothing inherent

in the phrase that would confine its scope to only the position taken by the

Department of Justice during litigation or only to the position taken by the

government after a certain point.

Id. at 357. The court’s decision is based in precedent, both recent and firmly rooted. See, e.g.,

Jean, 496 U.S. at 158-60 (The inquiry “properly focuses on the governmental misconduct giving

rise to the litigation.”) (emphasis added); Pierce, 487 U.S. 552, 565 (1988) (The “substantially

“substantially justified” standard)). This, however, raised concerns within the Department of

Justice, which commented “that the bill created ‘a more expansive award’ than was available to

other claimants against the government.” Id. (citing H.R. Rep. No. 104-373, at 7, 1996

U.S.C.C.A.N. at 4179). In response, the “substantially justified” standard was “added later via

amendment of the bill by the Senate.” See id. (citing 142 Cong. Rec. 27,243 (proposing the

amendment that added the “substantially justified” standard)). The Senate’s amendment was

adopted without discussion. Id.

14

justified” standard requires the government’s overall position to have a “reasonable basis both in

law and fact.”) (emphasis added) (citations omitted); Hitkansut, 142 Fed. Cl. at 357

(“[R]eference to the ‘position of the United States’ requires a threshold determination regarding

substantial justification encompassing the government’s entire conduct.”) (emphasis in original).

Further, the government’s argument regarding pre-litigation conduct creates the same

practical issue that the court highlighted in Hitkansut. “The court cannot determine whether the

government’s position during litigation was justified without examining the underlying facts

relating to the government’s conduct. A reasonable basis requires more than conceptual

arguments germane to the subject matter; arguments must also hue to the facts. That a litigation

postion may be reasonable in the abstract . . . does not mean that the litigation position as applied

to a specific case remains reasonable.” Hitkansut, 142 Fed. Cl. at 357.

The government’s position takes a myopic view of the “position of the United States.”

The very decision to litigate through trial and appeal, as opposed to settling before or at an early

stage of the litigation, could be viewed as not “substantially justified.” For example, if the

government infringed on the rights of a patent holder but decided to wage a lengthy and

protracted litigation in hopes of prevailing through attrition, that position would not be

“substantially justified.” Indeed, the point of the amendments to 28 U.S.C. 1498(a) in 1996 was

to allow smaller entities to obtain compensation when the government takes their property

through infringement. Allowing the government to use its resources to drown legitimate claims

would defeat the statute’s purpose. Accordingly, the court reaffirms its decision in Hitkansut

that all of the government’s conduct is considered when determining whether the position of the

United States was “substantially justified.”

C. The Government’s Entire Conduct

The relevant inquiry is whether the government has demonstrated that the positions it

took, including those taken by its contractor, were such that a reasonable person could conclude

that its position was supportable. See Pierce, 487 U.S. at 565 (Substantially justified means

“justified to a degree that could satisfy a reasonable person.”). Again, this inquiry “properly

focuses on the governmental misconduct giving rise to the litigation.” Jean, 496 U.S. at 165. As

this court held in Hitkansut, the government can be found liable for infringement and still be

found to have advanced a substantially justified position. Hitkansut, 142 Fed. Cl. at 358. The

court’s inquiry, then, is the totality of the steps the government took both before and during the

litigation.

The government argues that its position throughout the dispute was substantially justified.

See generally Def.’s Resp. at 11-31. It avers that “Congress did not intend the substantially

justified standard to raise a presumption that the [g]overnment position was not substantially

justified simply because it lost the case.” Def.’s Resp. at 11 (citing Scarborough v. Principi, 541

U.S. 401, 415 (2004)) (additional citation omitted). In short, the government believes its conduct

was substantially justified when viewed in totality, despite losing at both the trial and appellate

level. First, the government avers that its non-infringement defenses were reasonable and

substantially justified. Id. at 12-17. Second, the government states that FastShip’s contentions

that the government “willfully infringed” the patents-in-suit cannot be considered in the analysis

under Section 1498(a). Id. at 17-19. Third, the government argues that the Navy’s investigation

15

and denial of FastShip’s administrative claim was reasonable and substantially justified. Id. at

19-22. Fourth, the government points to the relatively low damages awarded to FastShip based

on exclusion of all Freedom class ships besides the LCS-1, id. at 23-24, and on its success in

limiting FastShip’s recovery to “reasonable and entire compensation” instead of royalties, id. at

25. Finally, the government points to its concessions during the litigation and that it “only chose

to appeal the defense related to the ‘increased efficiency’ requirement of the [patent] claims” as

evidence of “its deliberation and considered actions.” Id. at 26.

FastShip counters with positions taken by the government that were found to be

meritless. Prominent among these examples are the Navy’s actions during the administrative

claim from 2008 to 2010 and several positions taken by the government during litigation that

were contradicted by its own experts or witnesses at trial. Pl.’s Br. at 17-18, 20-27. FastShip

also points to the government’s use of a model for testing that did not “accurately reflect the

profile of the LCS vessels,” which resulted in inaccurate test data presented at trial. Id. at 27-29.

Finally, FastShip notes the government’s “clumsy misrepresentation of Figure 11” of the patents,

a chart that measured the efficiency of the LCS-1 compared to a displacement hull. Id. at 29-31.

According to FastShip, the government used the wrong units, i.e., imperial instead of metric,

which purposely understated the LCS-1’s increase in efficiency over a standard hull. Id. And

despite being told of this basic error on the first day of trial, the government continued its

“stubborn[] reli[ance]” on Figure 11 throughout trial and on appeal. Id. at 30.

The conduct of the government, both before and throughout this litigation, belies its

argument that it was “substantially justified.” Indeed, prior to the filing of this litigation in 2012,

the government and its contractors took several unreasonable steps. During procurement, the

government contractor that eventually won the Freedom class contract, Lockheed Martin, met

with FastShipt to discuss how FastShip’s technology could contribute “to the team.” FastShip

III, 131 Fed. Cl. at 601. Despite this meeting, where information related to FastShip’s patents

was shared and a confidentiality agreement was signed, and despite the inclusion in the proffered

design of a “semi-planing monohull” that would allow the Freedom class of LCS to achieve high

sprint speeds, id. at 602, FastShip was not included as a part of the team that eventually won and

constructed the LCS-1, id. at 601-03. Lockheed Martin would go on to manufacture the

Freedom class of ships for the government, with a completion and infringement date for LCS-1,

of September 26, 2006. Id. at 622-23.

The government’s actions during the administrative claim period from 2008 to 2010 also

undercut its position. After realizing that the LCS-1, and thus the design for the Freedom class

ships, infringed upon its patents, FastShip filed an administrative claim with the Navy on April

11, 2008. See FastShip III, 131 Fed. Cl. at 606 n.15 (citing Trial PX 200). The Navy sat on the

claim for the next two years. Id. Finally, in response to additional inquiries by FastShip, the

Navy issued a short, two-page denial. Trial PX 200. The letter to FastShip stated that the Navy

conducted a “thorough analysis,” but it did not include that analysis, if it occurred. Trial PX 200.

At best, this was a perfunctory response to the concerns of FastShip that ultimately proved

legitimate. At worst, it may have delayed FastShip’s filing of its claim in this court by two

years.

The government’s positions after the start of litigation create similar problems for its

attempt to establish reasonable justification. The government argued against the validity of the

16

’032 and ’946 patents, contending that both patents were obvious (and therefore unpatentable)

and both failed the enablement requirement under 35 U.S.C. § 112. See FastShip III, 131 Fed.

Cl. at 618-22. The court found those two arguments by the government to be unjustified. See

generally id. at 620-21, 622, 627. At trial, the government advanced flawed arguments in trying

to deny that LCS-1 infringed on FastShip’s patents. One of the government’s principal experts,

Dr. Frederick Stern, made several serious mistakes in his analysis and testimony. See FastShip

III, 131 Fed. Cl. at 616. The court afforded the testimony of Dr. Stern “little weight . . . because

it fails to take into account key characteristics of the performance of the model-scale and full-

size LCS-1.” Id. Further, Dr. Stern “overestimated the force of the waterjets [on the hull of the

ship] by a factor of four, which introduces errors.” Id. (emphasis added). Finally, Dr. Stern also

“fail[ed] to account for the scaling of the hydrodynamic boundary layer,” which “also

introduce[d] error into [his] calculations.” Id. In other words, one of the government’s primary

expert witnesses made repeated errors in his analysis that all happened to show it was less likely

the LCS-1 infringed on the FastShip’s patents. This is not reasonable conduct.

The government, as noted earlier with reference to “Figure 11” of the patents, also used

incorrect units in its attempt to prove that the LCS-1’s design did not increase its efficiency, i.e.,

that its design did not infringe. See FastShip III, 131 Fed. Cl. at 617-18. This change, although

subtle, made the LCS-1 displacement hull appear to be less efficient. Id.12 The government’s

expert used the wrong units in his analysis, in essence rejecting the very rationale for the

displacement type hull and the LCS program, i.e., for “new ships that could be used for ‘focused

missions’ at high speeds.” Id. at 600. The government, through its erroneous analysis, was

essentially arguing that the design it chose for its efficiency, was, in fact, not efficient.

The government also persisted in arguing against the validity of the ’032 and ’946

patents, contending that “a combination of prior art references . . . renders the [two patents]

obvious under 25 U.S.C. § 103.” FastShip III, 131 Fed. Cl. at 618-21. In support of its position,

the government introduced the testimony of Mr. Donald Blount. According to the government,

because Mr. Blount performed a “feasibility analysis” that combined prior art references, the

patents at issue “would have been obvious to a person of ordinary skill in the art before the

priority date.” Id. at 619. The court, however, found that Mr. Blount had “extraordinary skill,”

id. at 619-20, i.e., he was an individual with “over three decades of experience as a naval

architect, [and who had] published numerous articles in the field and served as the department

head for the Combatant Craft Engineering Department within the Navy,” id. at 620. Mr. Blount

had performed his analysis in connection with his proprietary design of the Destriero, a private

yacht that would “operate in a semi-planing condition when at full load and in a planing mode

when lightly loaded.” Id. at 619. Although the government proffered him as a person of

ordinary skill in the art in attempting to prove that the “patented invention [was] obvious,” id. at

619, it was unreasonable to do so given his decades of experience, and the design work he was

conducting for a yacht not comparable to a larger ship, while working at the same time Mr. Giles

12

And, as FastShip correctly observes, the government’s error was pointed out to them by

Mr. Giles on the first day of trial. Pl.’s Br. at 31; see also Trial Tr. 65:11 to 67:6, 205:3-20.

17

was conducting experiments and obtaining the patents at issue. Notably, the parties had agreed

to a definition for a person of ordinary skill in the art before trial. See id. at 620.13

As for the enablement requirement, the government at trial attempted to argue that the

“specification of the [two patents] only discloses one mode of practicing the invention,” and was

therefore invalid. FastShip III, 131 Fed. Cl. at 621. But the court found the government’s

position counter to established patent law that permits “describing a single mode of practicing

the invention.” Id. (citing Epistar Corp. v. International Trade Comm’n, 566 F.3d 1321, 1336

(Fed. Cir. 2009)). The court does not find this conduct to be substantially justified.

As for compensation, the government is correct in arguing that the amount of damages

that FastShip eventually received was smaller than claimed because the Freedom class of vessels

later than LCS-1 were not manufactured before the patents expired. But, the primary issue was

whether the government infringed on FastShip’s patents. Although the government may have

forestalled FastShip from obtaining the recovery it originally sought, that does not change the

fact that the positions it took with regards to infringement, from the conduct of Lockheed Martin

through trial, were unreasonable. In this respect, the government’s position was substantially

justified during the litigation in getting summary judgment granted in their favor with regards to

the LCS-3 and the other Freedom class ships. See Def.’s Resp. at 22-25. According to the

government, because it was successful in reducing the amount of damages paid to FastShip, its

overall position to litigate was justified. Id. But this position takes a cabined view of the court’s

decision. The claims regarding the LCS-3 and later Freedom class ships were, in effect, time

barred due to the court’s interpretation of “manfaucture.” See FastShip II, 122 Fed. Cl. at 82-86.

The court, affirmed by the Federal Circuit, found that the government did not “manufacture” the

LCS-3 and later ships in accordance with 28 U.S.C. § 1498(a) because the patents had expired.

Id., see also FastShip IV, 892 F.3d at 1303-08. Further, because the court is to consider the

“totality of the circumstances” in conducting its inquiry, the government’s position as a whole is

not substantially justified even though it may have taken reasonable stances in some respects.

The burden in proving reasonableness is on the government, and the court finds the

government has failed to carry that burden in this case. Although parts of the government’s

conduct could be seen as reasonable when viewed in isolation, its overall conduct demonstrates

its position was ultimately not “substantially justified” when viewed in totality.

III. The Appropriate Amount of Fees, Expenses, and Costs

As an initial matter, the government argues that the fees charged by FastShip’s counsel

are too high and should be reduced for a variety of reasons. The government also specifically

challenges several of the costs charged by FastShip. First, the government argues that FastShip

should not receive an award for any fees related to the LCS-3 summary judgment. Def.’s Resp.

at 32. Second, the government argues FastShip’s fees for a “computational analysis in Sweden”

should not be awarded. Id. at 32-33. Further, the government avers that the fees for FastShip’s

13

The parties “agree[d] that a person having ordinary skill in the art would have a

‘bachelor’s degree in naval architecture, hydrodynamics, or marine engineering, or equivalent

work experience in the same fields.’” FastShip III, 131 Fed. Cl. at 620 (citing Def.’s Post-Trial

Br. at 41, ECF No. 166).

18

appeal to the Federal Circuit should be disallowed. Id. at 33-34. Next, the government states

that FastShip should not be granted fees for its earlier motions to compel production of

documents from General Dynamics and Austal. Id. The government also challenges fees for

attorneys “whose experience, role, and tasks have not been justified.” Id. at 34. Finally, the

government contends that the approximately $1.7 million in expert witness fees should be

reduced – specifically targeting the approximately $1.5 million in fees charged Ms. Krista Holt,

FastShip’s damages expert. Id. at 40-43. To properly evaluate the fees requested by FastShip,

the court will first determine whether any of the individual components identified by the

government are ineligible for fees before examining whether FastShip’s fees and hours are

reasonable.

A. Fees for Various Discrete Aspects of this Litigation

1. The dismissal of the LCS-3 claim.

The government argues that FastShip should not receive any fees for its work related to

the LCS-3. Def.’s Resp. at 32. “Since the [c]ourt determined that LCS-3 did not infringe

because it was incomplete, FastShip is not entitled to recover any of those fees that it claims

relating to LCS-3.” Id. FastShip counters that the “LCS-1 and LCS-3 are very similar vessels . .

. [and] FastShip utilized a significant amount of evidence that focused on the LCS-3 in its

successful proof of infringement by the LCS-1.” Pl.’s Br. at 50. It avers that due to the

“importance of [the] evidence regarding the LCS-3 to show infringement by the LCS-1,”

FastShip is entitled for attorneys’ fees for its work on the LCS-3. Id. at 51.

The court agrees with FastShip. The claims related to LCS-1 and LCS-3 were closely

linked. The question presented with respect to LCS-3, the judicial interpretation of the term

“manufacture,” was an issue of first impression for the court, see FastShip II, 122 Fed. Cl. at 80,

and for the Federal Circuit, see FastShip IV, 892 F.3d at 1303. It is a mistake to sever the issues

when looking at the claim of infringement.14 Whether the LCS program employed technology

that infringed upon FastShip’s patents was the primary question of this case. If the court had

found that LCS-3 did infringe, it would only add to damages. Put differently, FastShip had one

core claim regarding infringement by the government. If it prevailed on this claim, it would

receive compensation. How much compensation FastShip would receive ultimately depended on

how many ships the court found to be infringing. Thus, the thrust of the claim was for

infringement, with damages branching from this central issue. As in Hitkansut, FastShip’s award

for attorneys’ fees and costs should not be reduced because it was unsuccessful on a subsidary

aspect of its claim. See Hitkansut, 142 Fed. Cl. at 364 (finding that even though Hitkansut was

not successful with regard to a royalty issue that reduced its award by “95%,” it did not matter

with regards to attorneys’ fees because “infringement represented the primary issue.”).

2. FastShip’s computational analysis.

The government next argues that FastShip should not receive any fees for its work related

to a computational analysis performed by “experts [] in Sweden.” Def.’s Resp. at 33. The

14

In its complaint, FastShip filed one count of infringement with the court. See Compl.

¶¶ 16-18.

19

computational analysis at issue concerned the hydrodynamic properties of the hull of the LCS.

According to the government, FastShip claims “$349,292.50 in fees and expenses related to [the

experts’ failed work,” but that the work of the experts in Sweden “was never disclosed, cited, or

relied on by FastShip [and] accordingly, it was not a necessary expense.” Id.

FastShip contests the government’s characterization of the work performed by the experts

in Sweden. FastShip argues that although the work of the Swedish experts was not used directly

during trial, it nevertheless was “critical to FastShip in understanding the limitations of

computational fluid dynamics (CFD) to model and compute the hydrodynamic properties of

large naval vessels such as LCS-1.” Pl.’s Reply at 17. This limitation demonstrated to FastShip

that “full scale CFD was not possible, and scale mode CFD was too erroneous.” Id. This

allowed FastShip to make a “strategic decision” regarding CFD data and also to determine that

the government’s expert, Dr. Stern, had numerous “errors [in his analysis that] were in the

[g]overnment’s favor.” Id. at 18.

The court agrees with FastShip. The analysis performed by the experts in Sweden with

respect to CFD was an integral foundation for rebutting the government’s non-infringement case.

Although the report was not used at trial, see FastShip III, 131 Fed. Cl. 592, it was referenced by

Dr. Garwin, an expert testifying on FastShip’s behalf, Pl.’s Br. at 17 (citing Trial Tr. 2311:23 to

2313:14), and was crucial in FastShip’s infringement case. The government’s assertion that the

CFD data was “not a necessary expense,” Def.’s Resp. at 33, is counter to the evidence, as it was

that very evidence that helped FastShip rebut the government’s primary infringement expert.

Thus, there is no basis to exclude the CFD analysis from FastShip’s fee award.

3. FastShip’s cross-appeal to the Federal Circuit.

The government also argues that FastShip should not receive any fees for its work related

to its cross-appeal to the Federal Circuit. Def.’s Resp. at 33-34. The government, in their brief,

argues that FastShip “turns the standard for this motion on its head” and that the standard is

“whether they succeeded and to what degree they succeeded.” Id. at 33. Further, the

government avers that “the entitlement to fees and costs ends when a judgment is entered. There

is no right to further fees unless judgment was reversed or vacated on appeal.” Id. at 34.

FastShip counters that the government’s portrayal of the appeal “ignores the overall

outcome.” Pl.’s Reply at 18. It argues that the “Federal Circuit affirmed the judgment of this

[c]ourt in all respects, except it increased the damages calculation in favor of FastShip.” Id.

(emphasis removed). And, “FastShip should be entitled to its fees incurred for the appeal,

[because] it resulted in FastShip prevailing beyond the judgment originally entered by this

[c]ourt.” Id.

Both sides overstate their success at the appellate level. FastShip is correct that their

damages were increased. But this was only due to a transcription error at the trial level and was

not a substantive change. See FastShip IV, 892 F.3d at 1310. On the other side, the government

was successful in having the summary judgment regarding the LCS-3 affirmed, but the finding

of infringement at trial was also affirmed. Thus, both sides could claim victory from the

appellate court’s decision.

20

Regardless, the court agrees that FastShip is entitled to fees. “[A] fee award

presumptively encompasses all aspects of the civil action” and “favors treating a case as an

inclusive whole.” Jean, 496 U.S. at 161-62.

4. Document production from General Dynamics and Austral.

The government further argues that “FastShip’s motion to compel production of [General

Dynanics]/Austral documents and to pursue sanctions were dismissed as moot . . . [, and]

FastShip should not be awarded attorneys’ fees . . . associated with these third party subpoenas.”

Def.’s Resp. at 34. FastShip counters that these motions “were necessary when made [because]

General Dynamics and Austral were not conventional third parties to this case, but contractors to

the [g]overnment that possessed relevant information.” Pl.’s Reply at 19. FastShip further

represents that these subpoenas were necessary because the government “represented it did not

have copies” of the requested documents. Id.

The court agrees with FastShip. The government is correct that the motion was denied as

moot. See Order of July 8, 2014, ECF No. 59. But the motion was denied as moot because the

parties were able to reach an agreement regarding production under the subpoena and the scope

of the subpoena. Hr’g Tr. 4:20 to 5:8 (June 18, 2014). It is likely due to the effect of the

subpoena, or the motion to compel, that brought the two parties together to reach an agreement

that did not require the court’s intervention. Further, FastShip was only required to issue the

subpoena to third-party Austral due to the government’s insistence that it did not possess the

documents at issue. Therefore, the government’s attempt to peel off this component of the

litigation, either because it was denied as moot or because it involved third parties, is

unpersuasive.

5. Unrelated cases.

The government also argues that FastShip’s request for attorneys’ fees “includes billing

entries that appear to be associated with other cases.” Def.’s Resp. at 35. FastShip, in their

reply, contends that the amounts identified by the government total “$5,360.00, and are relatively

de minimis.” Pl.’s Reply at 20. Either way, FastShip withdraws its request related to the fees

identified by the government, id. and accordingly, the court will not include them in its

consideration.

6. Preparing the present motions.

The government finally argues that FastShip “may be entitled” for fees for preparing the

instant motion, but that any award “should be reduced in proportion to the degree of success

achieved.” Def.’s Resp. at 45-46. FastShip, however, is entitled to recover “all reasonably

incurred fees.” Hitkansut, 142 Fed. Cl. at 360 (citing Jean, 496 U.S. at 156, 161-62). This

includes fees for the present motion, assuming they are reasonable. The court will examine the

fees requested and rates charged to determine if they reasonable.

B. Whether FastShip’s Requested Attorneys’ Fees And Expert Witness Fees Should Be

Reduced

21

The court has determined that FastShip is entitled to fees for the entirety of the litigation.

Thus, the court’s task is to now determine what amount of fees are reasonable.

1. Whether FastShip’s degree of success should reduce the requested fees.

The government argues that the court should “apportion the fee award to account for the

degree of success achieved by the plaintiff during individual phases of the dispute, or on specific

issues during the litigation.” Def.’s Resp. at 43-45 (citing Gargoyles, Inc. v. United States, 45

Fed. Cl. 139, 147 n.8 (1999) (in turn citing Community Heating & Plumbing Co., Inc. v. Garrett,

2 F.3d 1143, 1146 (Fed. Cir. 1993)). In this case, the government contends that the award from

the court at trial, $7.4 million, “is the primary factor in evaluating the degree of success that was

achieved in this litigation.” Id. at 44.15 And, because FastShip sought damages that were much

higher than the ultimate award, i.e., because it “alleged that damages for the LCS-1 alone were

$44 million,” FastShip ultimately achieved a limited amount of success, which should reduce its

fees accordingly. Id.16

FastShip counters that “cost apportionment” does not make sense in this case, as “there is

no basis to apportion amount that had to be incurred ‘regardless of how many ships’ would be

manufactured.” Pl.’s Reply at 28-33. FastShip also avers that it “achieved excellent results,” id.

at 29, because it was successful in showing “the LCS class of ships infringed the asserted

patents” and “recovered millions of dollars as compensation,” id. at 32. FastShip also argues that

“the [g]overnment’s argument incorrectly assumes that multiple claims were litigated,” but that

in this case, “FastShip asserted a single count,” upon which it prevailed at trial. Id. at 32.

The court rejected a similar argument advanced by the government in Hitkansut. 142

Fed. Cl. at 363-64. In Hitkansut, the eventual award was reduced by 95% from what the plaintiff

originally sought. Id. The court, however, refused to reduce the award for attorneys’ fees by

95% because damages “did not represent 95% of the case. Rather, infringement represented the

primary issue.” Id. at 364. Like the current case, the only claim brought by Hitkansut was for

infringement – a claim upon which it prevailed. Id.

Further, not only is the government’s approach legally incorrect, it presents practical

difficulties. See Hubbard v. United States, 480 F.3d 1327, 1334 (Fed. Cir. 2007) (rejecting a

“mechanical” approach, in favor of a “nuanced approach.”). While the government asserts that

“FastShip’s attorneys’ and expert witness fees should be adjust[ed] in accordance with the

degree of success achieved,” it does not provide the court with a number or percentage that

would allow for this adjustment. Def.’s Resp. at 45. The court would thus be arbitrarily

choosing a denominator that it views as appropriate. The government’s approach could also

discourage attorneys from bringing viable claims to their full extent, defeating the purpose of 28

U.S.C. § 1498(a).

15

As noted, supra, at 1, FastShip’s recovery for the infringement was actually $12.36

million, taking into account delay damages.

16

The government alleges that “[a]t best FastShip succeeded in proving only half of its

claims . . . , and perhaps as little as one-sixth of the claims it asserted.” Def.’s Resp. at 45.

22

2. Whether an award of attorneys’ fees and related expenses creates a windfall.

The government also contends that the any award of attorneys’ fees to FastShip will

“compensate counsel twice for the same work,” Def.’s Resp. at 38, because of the contingent fee

arrangement originally agreed by FastShip with Dentons. Id. FastShip counters that the

government’s contentions are belied by FastShip’s “Supplemental Agreement,” that specifies

that “any fee award to FastShip based on the [present motions] shall be paid to FastShip and that

FastShip shall make payments to Dentons only after FastShip has fully deducted the fees that

FastShip has already paid to Dentons.” Pl.’s Reply at 22-23.

The court agrees with FastShip. The Supplemental Agreement provided with FastShip’s

reply, see Pl.’s Reply Ex. B, at 2-3, makes evident that any fee awarded to FastShip and paid to

Dentons will be net of any fees or contingency payments already made. The court is satisfied the

Supplemental Agreement ensures that no double payment or windfall will go to Dentons for any

award of attorneys’ fees and costs.

3. What amount of fees are reasonable.

FastShip requests a total of $6,988,906.80 in attorneys’ fees and related expenses for the

work performed on the entirety of the litigation. See Pl.’s Resp. at 1 & Ex. B at 2. In total,

FastShip’s records indicate they expended 11,985.40 hours from 2012 through 2018. Id. A total

of 41 individuals worked and charged hours on the case over the six years of litigation. See id.

Ex. B at 2.17 The two highest billers were the attorney of record for FastShip, Mr. Mark L.

Hogge, who billed 2,303.70 hours, and Mr. Rajesh C. Noronha, Senior Managing Associate, who

billed 3,175.10 hours. Id. Mr. Hogge graduated from law school in 1984 and is currently the

“chair of Dentons’ legacy Patent Litigation practice.” Pl.’s Br. at 34. He has over 30 years of

intellectual property litigation experience, and FastShip represents that he has experience “in all

the tribunals where IP is likely to be litigated.” Id. Throughout the litigation, FastShip

represents that Mr. Hogge charged an average rate of $835. Pl.’s Resp. Ex. B at 2. Mr. Noronha

graduated from law school in 2005 and has 14 years of intellectual property experience. Pl.’s Br.

at 35. FastShip represents that Mr. Noronha is a patent litigator in Dentons’ “Intellectual

Property and Technology group” and has litigated intellectual property cases before a variety of

courts. Id. Throughout the litigation, FastShip represents that Mr. Noronha charged an average

rate of $669. Pl.’s Resp. Ex. B at 2.

Other major billers include: Sharon M. Norwood, Paralegal, who billed 1,132.10 hours at

a $266 average rate; Shailendra K. Maheshwari, Partner, who billed 1,021.50 hours at a $585

average rate; Carl P. Bretscher, Counsel, who billed 1,014.70 hours at a $643 average rate;

Cheryl M. Bednarz, Paralegal, who billed 832.50 hours at a $318 average rate; and Thomas R.

Millar, associate, who billed 566.10 hours at a $472 average rate. Pl.’s Resp. Ex. B at 2.

The statute expressly permits recovery of “reasonable fees for . . . attorneys.” 28 U.S.C.

§ 1498(a). The “most useful starting point . . . is the number of hours reasonably expended on

17

The titles of these individuals range from the traditional “Partner” and “Associate” to

also include a “Supervisor Discovery Technology Services.”

23

the litigation multiplied by a reasonable hourly rate.” Hubbard, 480 F.3d at 1332 (quoting

Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). A reasonable rate is one “adequate to attract

competent counsel” while avoiding “windfalls to attorneys.” Biery v. United States, 818 F.3d

704, 710 (Fed. Cir. 2016) (quoting Hensley, 461 U.S. at 444). Reasonable attorneys’ fees for all

stages of the litigation are recoverable. E.g., Jean, 496 U.S. at 156, 161-62 (“[A] fee award

presumptively encompasses all aspects of the civil action.”). With these starting points, the court

“must then consider [several factors regarding] whether to increase or decrease the fee, of which

‘the most critical factor is the degree of success obtained.’” Hubbard, 480 F.3d at 1332 (quoting

Hensley, 461 U.S. at 436). In Hitkansut, the court found that these standards applied to fee-

shifting provisions of the Civil Rights Act, EAJA, and the Uniform Relocation Act, 142 Fed. Cl.

at 361-62 (citing Hubbard, 480 F.3d at 1333 (discussing the Civil Rights Act and EAJA); Biery,

818 F.3d at 712 (Uniform Relocation Act); Lost Tree, 135 Fed. Cl. at 96 (Uniform Relocation

Act)), and it ruled that this approach should apply to fees sought under 28 U.S.C.§ 1498(a) as

well, id.

A number of different indices exist for determining the reasonable hourly rate for

attorneys’ fees under fee-shifting statutes. Plaintiff provides excerpts of the American

Intellectual Property Law Association’s 2017 Report of the Economic Survey (“AIPLA

Survey”), see PX 10. The AIPLA’s Economic Survey is the most recent report available that

summarizes attorneys’ fees in intellectual property litigation, broken down by geographic

location, levels of experience, and other categories. See AIPLA Survey; see also Hitkansut, 142

Fed. Cl. at 347. Another index is the Adjusted Laffey Matrix (also provided by plaintiff), a chart

developed by the United States Attorney’s Office. PX 11.18 An alternative to the Adjusted

Laffey Matrix is the “Kavanaugh Matrix.”19 The Federal Circuit provides this court with

significant discretion in determining the reasonable rate for attorneys’ fees, calling upon the

18

For an extensive discussion of the genesis and history of the Adjusted Laffey Matrix,

see DL v. District of Columbia, 924 F.3d 585, 589-90 (D.C. Cir. 2019); see also Biery, 818 F.3d

at 714. The Adjusted Laffey Matrix is “based on changes to the cost of living in the Washington

D.C. metropolitan area as measured by the Consumer Price Index for All Urban Consumers.”

Biery, 818 F.3d at 713 (citations omitted). The Laffey Matrix was developed by the Civil

Division of the United States Attorney’s Office for the District of Columbia to evaluate requests

for attorney’s fees in civil cases in District of Columbia courts. See Laffey Matrix, United States

Department of Justice, https://www.justice.gov/usao-dc/file/796471/download (last accessed

June 17, 2019). The stated purpose of the Adjusted Laffey Matrix is “for use in cases in which a

fee-shifting statute permits the prevailing party to recover ‘reasonable’ attorney’s fees.” Laffey

Matrix n.1.

19

The Kavanaugh Matrix, named after its economist creator, Dr. Michael Kavanaugh,

“makes adjustments to the Laffey Matrix based on changes to the Legal Services Index []

component of the Consumer Price Index . . . to provide adjustments that solely capture the

market for legal services.” Biery, 818 F.3d at 713.

In DL, the D.C. Circuit ruled that the new Kavanaugh Matrix “based on data for all types

of lawyers–not just those who litigate complex federal cases–from the entire metropolitan area–

not just the District of Columbia,” had been inappropriately applied in a complex litigation in the

District Court for the District of Columbia. DL, 924 F.3d at 587-88, 591-92.

24

court to “consider all the relevant facts and circumstances,” and provide “a concise but clear

explanation of its reasons for the fee award.” Biery, 818 F.3d at 714 (quoting Hensley, 461 U.S.

at 437). “This includes the decision to use either the Adjusted Laffey Matrix or the Kavanaugh

Matrix or any departure, or no departure, from the rates they suggest.” Id.

In this case, the primary legal market is Washington, D.C. All of the attorneys and

support staff identified by FastShip in their brief were located in the D.C. area. See Pl.’s Br. at

33-38. While the Adjusted Laffey Matrix is a useful tool for determining attorneys’ fees, the

court believes, as it did in Hitkansut, that the AIPLA Survey provides the most relevant starting

point in this case. Hitkansut, 142 Fed. Cl. at 361. The AIPLA 2017 Survey provides the most

recent attorney fee data particular to intellectual property litigation, a specialized field that

specifically applies to this case. Further, the AIPLA Survey allows for the same geographic

narrowing that the Adjusted Laffey Matrix provides.

For partners in the Washington, D.C. area, the AIPLA Survey provides an average hourly

rate of $535, a median of $470, a third quartile of $681, and a 90th percentile of $818. AIPLA

Survey at I-27. For associates in the Washington, D.C. area, the AIPLA Survey provides an

average of $452, a median of $400, a third quartile of $555, and a 90th percentile of $700. Id. at

I-39. Here, the court believes the rates in the third quartile from the AIPLA 2017 Survey provide

a reasonable compensation base that is “adequate to attract competent counsel,” but also avoids

providing a “windfall” to FastShip. Biery, 818 F.3d at 710 (quoting Hensley, 461 U.S. at 444);

see also Hitkansut, 142 Fed. Cl. at 362 (finding the third quartile to be “appropriate to attract

counsel competent to handle highly-technical patent litigation against the resources of the federal

government.”). As FastShip’s counsel obtained success against the government in this difficult

litigation, the court believes using the third quartile number for both associates and partners is

appropriate. Both of the relevant rates, $681 for partners and $555 for associates, are well above

the number suggested by the Adjusted Laffey Matrix.

The court finds that the AIPLA Survey third quartile hourly rate of $681 is reasonable for

Mr. Hogge, given his patent litigation experience. Although this number is lower than the

average hourly rate of $835 requested by FastShip for the services of Mr. Hogge, the court

believes it satisfies the purpose of the statute. Thus, the court awards FastShip $1,568,819.70 in

fees for the work of Mr. Hogge. See Pl.’s Resp. Ex. B at 2.20 The court further finds that the

AIPLA third quartile hourly rate of $555 is reasonable for Mr. Noronha, also considering his

patent litigation experience and heavy role in terms of hours worked. Again, while this number

is lower than the average hourly rate of $669 requested by FastShip for the work of Mr.

Noronha, the court believes it provides reasonable compensation to attract competent counsel.

The court therefore awards FastShip $1,762,180.50 for the services of Mr. Noronha.21

20

FastShip represents that Mr. Hogge worked 2,303.70 hours on the litigation. Pl.’s Resp.

Ex. B at 2. This number multiplied by the $681 third quartile hourly rate equals $1,568,819.70.

FastShip rerepsents that Mr. Noronha worked 3,175.10 hours on the litigation. Pl.’s

21

Resp. Ex. B at 2. This number multiplied by the $555 AIPLA third quartile hourly rate equals

$1,762,180.50.

25

FastShip also bills for several individuals who contributed significant hours to the

litigation, albeit at levels below Mr. Hogge and Mr. Noronha. See Pl.’s Br. at 34-38; see also

Pl.’s Resp. Ex. B at 2. These individuals are Gary D. Mangels, a Senior Managing Associate who

billed 385.10 hours at a $535 rate, for a total bill of $206,009.68; James F. Wiley, Jr., Associate,

who billed 214.50 hours at a $495 rate, for a total bill of $106,168.49; Matthew P. Larson,

Associate, who billed 340.60 hours at a $420 rate, for a total bill of $143,052.00; Nicholas H.

Jackson, Partner, who billed 247.10 hours at a $451 rate, for a total bill of $111,352.50;22

Shailendra K. Maheshwari, Partner, who billed 1,021.50 hours at a $585 rate, for a total bill of

$597,344.02; and Thomas R. Millar, Associate, who billed 566.10 hours at a $472 rate, for a

total bill of $267,280.00. These individuals are billed at rates lower than the AIPLA Survey

numbers adopted by the court, and the court also is satisfied with the justification provided by

Fastship. The court consequently awards these fees as requested. Thus, the court awards

FastShip $1,431,206.69 in attorneys’ fees for the services of Mr. Wiley, Mr. Larson, Mr.

Jackson, Mr. Mangels, Mr. Maheshwari, and Mr. Millar.

There is, however, one individual who billed significant time to the matter whose

participation is not fully supported by FastShip: Mr. Carl P. Bretscher, Counsel. See Pl.’s Br. at

34-38 (no mention of Mr. Carl P. Bretscher); Pl.’s Reply at 19-20 (same). Mr. Bretscher billed

1,014.70 hours on the litigation at a $643 hourly rate, for a total bill of $652,729.50. Pl.’s Resp.

Ex. B at 2. While the rate charged by Mr. Bretscher is below the AIPLA third quartile number of

$681 for a partner, the court believes his rate should also be adjusted downward due to the lack

of detail on his background, although he did conduct direct examination of witnesses at trial

during several days. Consequently, the court will award the hours worked by Mr. Bretscher at

60 percent of the requested amount. Thus, FastShip is awarded $391,637.70 for the work

performed by Mr. Bretscher.

FastShip also requests fees for several individuals, ranging from associates to partners

and counsels, who each billed less than 75 hours, most less than 30. See Pl.’s Resp. Ex. B at 2.

A review of the entries detail that these individuals, with three exceptions, each billed at an

average rate below the AIPLA third quartile, whether they were partners or associates. The court

therefore awards each of these fees as requested, for a total of $97,723.41.23 The exceptions,

however, are Mr. Kirk R. Ruthenberg, a partner who billed 36.60 hours with an hourly rate of

$995 for a total of $36,417; Mr. Charles R. Bruton, a counsel who billed 8.00 hours with an

22

Mr. Jackson’s lower rate reflects the fact that he primarily served as an associate

attorney on the case during discovery. Pl.’s Br. at 37.

23

Claire E. Bornstein, Managing Associate, 1.20 hours, $395 rate, $474.00 total bill;

Daniel Morris, Senior Managing Associate, 52.40 hours, $550 rate, $28,820.00 total bill; Jason

M. Silverman, Partner, 0.60 hours, $625 rate, $375.00 total bill; Jessica A. Rebarber, Managing

Associate, 0.90 hours, $395 rate, $355.50 total bill; Leslie A. Barry, Managing Associate, 73.50

hours, $399 rate, $29,348.78 total bill; Michael E. Zolandz, Partner, 9.00 hours, $648 rate,

$5,829.00 total bill; Nathan P. Sportel, Associate, 5.50 hours, $230 rate, $1,265.00 total bill;

Peter G. Feldman, Partner, 24.40 hours, $578 rate, $14,097.00 total bill; Robert M. Holland,

Associate, 38 hours, $335 rate, $12,729.63 total bill; Shannon L. Smith, Counsel, 1.50 hours,

$425 rate; $637.50 total bill; Ying-Hua B. Sun, Associate, 9.60 hours, $395 rate, $3,792.00 total

bill.

26

hourly rate of $740, for a total of $5,920; and Derek A. Auito, a senior managing associate who

billed 4.30 hours with an hourly rate of $625, for a total of $2,687.50. See id. As FastShip does

not provide any details that would justify Mr. Ruthenberg’s, Mr. Bruton’s, or Mr. Auito’s high

billing rates, the court will accordingly adjust their rates downwards to the AIPLA survey rate of

$681 per hour for Mr. Ruthenberg and Mr. Bruton, and $555 for Mr. Auito. Thus, the court

awards FastShip $24,924.60 for the work of Mr. Ruthenberg, $5,448 for the work of Mr. Bruton,

and $2,386.50 for Mr. Auito.

As for support staff and paralegals, FastShip asks for an approximate average rate of

$292 across all support categories. See Pl.’s Resp. Ex. B at 2. The AIPLA Survey does not

include information for paralegals and support staff. Therefore, the court will use the Adjusted

Laffey Matrix as a starting point. The Adjusted Laffey Matrix for 2015-2019 lists the reasonable

hourly rate for support staff and paralegals at $154, $157, $164, and $166, respectively. Laffey

Matrix at 1. In Hitkansut, a litigation of similar scope and complexity, the court found $150 to

be appropriate for paralegals and support staff. 142 Fed. Cl. at 363. But the work in Hitkansut

was performed in Detroit, Michigan, a less expensive market than Washington, D.C. Id. The

court will therefore adjust this number upwards to reflect the difference in market. The court

will further adjust the number upwards from the Adjusted Laffey Index to reflect the technical

nature of patent litigation and the experience of the identified and explained support staff. See

Pl.’s Br. at 37-38. Thus, the court believes an average rate of $175 is appropriate compensation

for paralegals and support staff.

As FastShip includes billing details for several individuals with non-traditional titles24 but

does not provide any details about their backgrounds or their roles in this litigation beyond their

title, the court will consider these individuals to be “support staff” and billed at the $175 rate.

Using the summaries provided by FastShip, see Pl.’s Resp. Ex. B at 2, the court calculates that

support staff billed 2,451.50 hours on the FastShip matter.25 This number, multiplied by the

$175 rate for support staff, equates to $429,012.50 of attorneys’ fees and related expenses for

FastShip’s support staff.

24

Such staff include, e.g., Mr. Hilliard T. Moore, Jr., a “Discovery Engineer” who billed

4.80 hours and charged a $308 average hourly rate.

25

This number is the sum of all of the non-attorney members of the FastShip litigation

team and includes: Allie Bernado, Administrative, 2.10 hours; Angela M. King, Paralegal, 3.00

hours; Cheryl M. Bednarz, Paralegal, 832.50 hours; Craig S. Everly, Paralegal, 138.20 hours;

Debra L. Atkins, Policy Research Director, 7.50 hours; Derek J. Boor, Supervisor Discovery

Technology Services, 4.00 hours; Hilliard T. Moore, Jr., Discovery Engineer, 4.80 hours; Jaye

Lapachet, Administrative, 23.50 hours; Jeffrey M. Hanson, Paralegal, 10.40 hours; Karen H.

Johnson, Paralegal, 220.80 hours; Kristine M. Lieurance, Discovery Project Manager, 0.40

hours; Lidija Pegan-Knight, Paralegal, 4.10 hours; Marine A. Ratner, Administrative, 0.30 hours;

Mary K. Ciziunas, Research Specialist, 3.60 hours; Mary R. Smyth, Paralegal, 12.50 hours;

Rubert Ellison, Jr., Discovery Analyst, 49.30 hours; Ryan Aldrich, Discovery Project Manager,

2.40 hours; Sharon M. Norwood, Paralegal, 1132.10 hours.

27

In sum, the court awards FastShip $5,713,339.60 for attorneys’ fees.

4. Expert witness fees.

As a preliminary matter, “[r]easonable and entire compensation . . . includ[es] reasonable

fees for expert witnesses.” 28 U.S.C. § 1498(a). Fees for experts are considered to be

presumptively reasonable if they were incurred in an arm’s length transaction. See, e.g.,

Hitkansut, 142 Fed. Cl. at 365 (citing Lost Tree, 135 Fed. Cl. at 96 (in turn citing Florida Rock

Indus., Inc. v. United States, 9 Cl. Ct. 285, 290 (1985) (“Fees incurred and paid by a client at an

agreed rate are presumptively reasonable.”))). FastShip requests fees related to the services of

four expert witnesses, three of whom testified at trial. The government opposes some of the

proposed fees for certain experts, most notably those fees requested for Ms. Krista Holt,

FastShip’s damages expert.

(a) Dr. Richard Garwin.

FastShip asks for fees and expenses related to the testimony of Dr. Richard Garwin. Pl.’s

Br. at 46-47. In its original brief, FastShip asked for $180,610.66 in fees related to Dr. Garwin,

id., but later increased the amount to $196,264.75 via a supplemental fee request, see Pl.’s Suppl.

Mem. at 1; see also PX RR. The government opposes the fees and expenses related to Dr.

Garwin “because FastShip did not comply with the requirement that Dr. Garwin’s rates be

identified at the time of his expert report and the invoices and related documentation were not

timely filed with this application.” Def.’s Resp. at 41. The government’s argument is essentially

a technical one, i.e., that because FastShip did not “timely file[]” his invoices and related

documentation or provide his rates at the time of his expert report, it is not entitled to fees for his

services. Id. The government does not substantively object to any other aspects of the fees

requested for Dr. Garwin, i.e., the rates charged or the hours worked. See id.

The court finds the fees requested for Dr. Garwin to be reasonable, as the government’s

form-over-substance argument is not persuasive. At trial, the court admitted Dr. Garwin as an

expert in fluid dynamics and accepted his expert report into evidence. See FastShip III, 131

Fed. Cl. at 613 n.23.26 Further, Dr. Garwin’s testimony at trial was integral to FastShip proving

infringement. See id. at 613-17. His testimony directly contradicted the government’s expert,

Dr. Stern, while exposing several significant errors in Dr. Stern’s analysis that ultimately led the

court to “accord[] little weight” to Dr. Stern’s testimony and expert report. Id. As for the

government’s arguments, Dr. Garwin testified at his deposition that his hourly rate was $375.

See Pl.’s Reply Br. at 26 (citing id. Ex. 5, Dep. Tr. of Dr. Richard Garwin at 84:6 to 85:9). In

addition, FastShip rectified their original omission by providing the invoices for Dr. Garwin’s

services. See Pl.’s Suppl. Mem.; PX RR. Thus, the court awards FastShip the requested

$196,264.75 in fees incurred for the services of the expert witness Dr. Richard Garwin.

26

Dr. Garwin is an eminent physicist who is a named inventor on 50 United States patents

and has published dozens of articles in various fields related to physics. He received the

National Medal for Science in 2002, La Grande Médaille de l’Académie des Sciences from

France, and the National Medal of Freedom in 2016.

28

(b) Dr. Chris McKesson.

FastShip requests $42,929.94 in fees and expenses related to the expert witness Dr. Chris

McKesson. See Pl.’s Br. at 47-48; see also PX LL. At trial, the court accepted Dr. McKesson as

an expert in “naval architecture, including waterjet propulsion. FastShip III, 131 Fed. Cl. at 611

n.19. And, like Dr. Garwn, his expert report was accepted into evidence. Id. The government

does “not object to the fees and expenses sought for Dr. McKesson.” Def.’s Resp. at 40-41.

Even so, much like Dr. Garwin, Dr. McKesson’s testimony was integral to FastShip’s case at

trial. See FastShip III, 131 Fed. Cl. at 611-17. Therefore, the court agrees with the parties

respecting the fees sought for Dr. McKesson and awards FastShip $42,929.94 in expert witness

fees and expenses for his services.

(c) Ms. Krista Holt.

FastShip requests $1,505,027.82 in fees and expenses for the services of Ms. Krista Holt

and her team at GreatBridge Consulting. Pl.’s Br. at 48-49; see also PX HH.27 Ms. Holt served

as the damages expert for FastShip in this case, Pl.’s Br. at 48, and was accepted by the court as

an expert in “patent damages valuation,” FastShip III, 131 Fed. Cl. at 623 n.33 (citing Trial Tr.

1151:2-4). Her expert reports were admitted into evidence. Id.

The government opposes the award to Ms. Holt for a variety of reasons. See Def.’s Resp.

at 41-43. It contends that the invoices provided by Ms. Holt’s company, GreatBridge

Consulting, are “very general,” and

[t]here is no way to determine which individual performed which ‘activities,’

nor is there any way to correlate which cost entries are associated with review

or analysis of particular documents. . . . Ms. Holt’s expert reports indicate she

considered at least 250,000 pages of documents in this case, including far more

technical documents than either Dr. McKesson or Dr. Garwin.

Id. at 42. The government also takes issue with the size of the amount requested for Ms. Holt,

which is “nearly six times the amount expended for FastShip’s two infringement experts

combined.” Id. at 43. The government further argues that Ms. Holt’s testimony was largely

ignored by this court. See id. at 42-43. In sum, the government requests that the fees to Ms. Holt

be reduced by the “degree of success achieved in the damages award, i.e., 7/44 (16%).” Id. at

43.

The court is concerned by the amount of fees charged by Ms. Holt. There is, as the

government notes, a significant imbalance between the costs charged by each of the experts.

Approximately $1.5 million of a total of $1.7 million in requested expenses for expert witnesses

relates to Ms. Holt. But Ms. Holt was an expert for damages. She did not testify with respect to

the primary issue of infringement. It is not apparent how Ms. Holt was able to accumulate nearly

27

The total of the invoices, less discounts and other credits, equals $1,507,943.32.

FastShip may have double-counted a $2,915 credit. See PX HH at 146, 148. FastShip also did

not include the July 2017 invoice. See PX 2-B at 22. The court begins, however, with the

amount requested by FastShip.

29

$1.5 million in fees when testifying to a secondary issue. Further, a review of the invoices for

Ms. Holt provided by FastShip in support of their request shows little detail. Descriptions of the

work performed are vague, generalized, and non-specific. See, e.g., PX HH at 6-7. For example,

the invoice covering March 8, 2013 to April 30, 2013, totaling $24,436.25, reportedly provides a

“summary of the activities performed” but provides only minimal detail about what work was

actually done: “[r]esearch, [s]ummary of research, [a]ssistance with discovery, [d]ata analysis,

[c]onference calls with [c]ounsel/[c]lient, [j]ob [a]dministration.” Id. at 6-7. The other invoices

contain descriptions using identical or similarly vague terms. See, e.g., PX HH at 67. Although

the invoices do break down the hours charged by individual and their position at GreatBridge,

they do not provide detail on what work was actually performed by each individual, how many

hours were spent on particular tasks, or why that individual was qualified to bill at a particular

rate. See, e.g., PX HH at 106-07.

The court also has concerns about the amount and duration of Ms. Holt’s work. Ms.

Holt, despite testifying to the secondary issue of damages, first billed Dentons for work

beginning on March 8, 2013. PX HH at 2. Invoices continued on a near-monthly basis until July

of 2017 – after the court issued its opinion on infringement and damages on April 28, 2017 – for

largely the same services: “[r]esearch, [r]eview documents, [c]onference calls with

[c]ounsel/[c]lient, [j]ob [a]dministration.” PX HH at 151-52.28 The invoices average

$55,661.79, with a median amount of $27,392.50 and a high of $176,387.50 for June 2015 and a

low of $287.50 for February 2017. See PX HH at 80 (high), 144 (low). In total, Ms. Holt and

GreatBridge Consulting accumulated more than 6,500 hours on the FastShip engagement. See

PX HH. One month, July 2015, saw Ms. Holt and 11 other GreatBridge employees bill 794.75

hours to the FastShip engagement. PX HH at 86. The description for work performed for that

month lists tasks such as “[c]reation of [w]orksheets,” among other equally vague terms. PX HH

at 87. It is also not apparent why Ms. Holt, who has a bachelor’s degree in psychology and a

master’s degree in business administration, charges $425.00 per hour, especially when compared

to FastShips’ other two experts who both have PhDs, were eminently qualified, and charged

considerably less.29 In this case, the heavy lifting was on proving infringement of FastShip’s

patent by the government, a topic which was covered by Dr. Garwin and Dr. McKesson.

The sheer number of hours worked by Ms. Holt’s firm (6,564.75), whose ultimate

contribution to this case was the 3% royalty rate the court used for its damage calculation (which

itself was based on two of FastShip’s prior licenses), see FastShip III, 131 Fed. Cl. at 623, is

unexplained. The court found Ms. Holt’s testimony with regards to the reasonable compensation

base to be against established precedent in patent law. Id. at 625-26 (“Ms. Holt’s approach to

include the value of the entire ship as the royalty base, only excluding the cost of weapons, is

28

Ms. Holt charged Dentons $4,787.50 (after the application of an unexplained discount)

for work performed from March to June 2017. While the invoice does not describe when the

work was done, nothing in the case occurred between oral argument on February 21, 2017 and

entry the opinion on April 28, 2017, except for a motion to modify a Protective Order. What Ms.

Holt was researching at this late date is unexplained.

29

Dr. Garwin, for example, charged $375 per hour, and Dr. McKesson charged $125 per

hour.

30

inappropriate.”) (emphasis added). For comparison, Dentons spent 11,985.40 hours total in

litigating the entire case. See Pl.’s Resp. Ex. A at 5.

This court has held on numerous occasions that expert witness fees may be reduced for

lack of detail. See Raymo v. Secretary of Health & Human Servs., 129 Fed. Cl. 691, 704-05

(2016) (“[P]etitioners must provide ‘reasonably specific documentation’ to support the costs

requested.”); see also Impresa Construzioni Geom. Domenico Garufi v. United States, 100 Fed.

Cl. 750, 766-67 (2011) (finding that due to lack of documentation, “the court [was] unable to

determine whether the cost of the appraisals was reasonable, the court declines to made an

award.”) (citing Cobell v. Norton, 407 F. Supp. 2d 140, 163 (D.D.C. 2005) (finding that because

certain time entries were “inadequately documented [] it [was] impossible for the [c]ourt to

determine with a high degree of certainty that such hours were actually and reasonably

expended.”) (citation omitted)). The Supreme Court has specifically noted the problems

inadequate time records pose. See Hensley (finding an award of attorneys’ fees under 42 U.S.C.

§ 1988 requires that “the fee applicant bears the burden of establishing entitlement to an award

and documenting the appropriate hours expended and hourly rates. The applicant should

exercise ‘billing judgment’ with respect to hours worked, and should maintain billing time

records.”); see also White v. City of Richmond, 713 F.2d 458, 460-61 (9th Cir. 1983) (“[A]

[d]istrict [c]ourt should not award attorneys’ fees unless the prevailing party presents sufficiently

detailed records that the time expended and the need for the services are clearly established.”)

(disapproved on other grounds by Pennsylvania v. Delaware Valley Citizens’ Council for Clear

Air, 483 U.S. 711 (1987)).

Here, the court finds that the hours and time expended by Ms. Holt and her team are not

justified by the work documented or explained. As noted, the issue of damages was a secondary

component to this litigation, and Ms. Holt’s testimony was ultimately of modest assistance to the

court. Further, and importantly, the billing invoices by Ms. Holt lack any sort of detail that

would allow the court to discern why her team spent over 6,500 hours in performing her analysis.

For example, providing 13 lines of generic work descriptors, such as “[d]ata [e]ntry,” for nearly

800 hours of work performed during a single month is insufficient for an application of expert

expenses. FastShip has failed in its burden to provide support that would allow this court, with

reasonable certainty, to determine that Ms. Holt’s fees and services were reasonably necessary to

the case.

The court therefore reduces the fees awarded to FastShip for the services of Ms. Krista

Holt by 85%, to a total of $225,754.00. Even this reduced number is comparable to the

combined total fees for FastShip’s infringement experts ($239,194.69). The court believes this

reduced number is reasonable compensation for the work performed by Ms. Holt and her

contribution to the case. Cf. Hitkansut, 142 Fed. Cl. at 365 (awarding Hitkansut’s damage expect

$255,000)/

(d) Mr. Nicholas Edmiston.

FastShip finally requests $7,000 in expert fees for the services of Mr. Nicholas Edmiston,

“the founder and chairman of Edmiston & Co[.], a company that focuses on the sale, charter,

management and construction of yachts.” Pl.’s Br. at 49. According to FastShip, Mr. Edmiston

“served as a non-testifying expert regarding the valuation, sale, and construction of large marine

31

vessels, providing information to testifying expert Krista Holt that assisted her with damages

analysis.” Id. The government challenges the $7,000 paid to Mr. Edmiston, noting particularly

that FastShip provided has not supporting documentation regarding his participation in the

litigation. Def.’s Resp. at 43.

Mr. Edmiston did not testify at trial. Nor could FastShip provide invoices about what

work Mr. Edmiston performed, despite “working to obtain a copy of the invoices.” Pl.’s Br. at

49. Instead, FastShip provides a declaration by one of the attorneys on the case, Mr. Stout,

stating that Mr. Edmiston was a “[n]on [t]estifying expert . . . relied upon by Krista Holt.” PX 2

at 3. Yet, a declaration alone by one of the counsel is not enough to support an award of fees.

The court cannot tell if the fees were negotiated at arm’s length, if they were reasonable for the

work performed, or any other details about the work of Mr. Edmiston. Indeed, the fact that Mr.

Edmiston charged exactly $7,000 in fees and related expenses indicates that counsel is likely

rounding. And, according to Mr. Stout’s declaration and FastShip’s brief, the expert was used in

connection with Ms. Holt’s testimony, an expense which the court significantly reduced due to

concerns about its large size in proportion to the case. See supra. Therefore, the court denies the

$7,000 fee request by FastShip for the services of Mr. Edmiston.

In sum, the court awards FastShip $464,948.69 in expert witness fees.

C. Bill of Costs

The court must determine what amount of costs are reasonable and awardable if

reasonably related to the case and not otherwise barred. See 28 U.S.C. § 1498(a); Hitkansut, 142

Fed. Cl. at 366. The court has already determined that the conduct of the government was not

reasonably justified during this litigation. Compared with the attorneys’ fees and related

expenses, FastShip’s bill of costs is a relatively simple. FastShip originally claimed

$2,430,047.71 in its bill of costs, Pl.’s Cost Br. at 57, but dropped this number to $1,279,735.62

following objections by the government.30 The government and FastShip agree that the vast

majority of the remaining requested costs are reasonable and not specifically barred. See Def.’s

Objs. at 5-6; Pl.’s Bill of Cost Reply at 3. Both parties agree that $1,096,193.08 of the

uncontested costs are recoverable under 28 U.S.C. § 1498.31 And, both parties agree that a

30

Most of the controversial costs, such as those for FastShip’s bankruptcy and living

expenses for Mr. David Giles, were dropped by FastShip in their reply. See Pl.’s Bill of Cost

Reply at 6.

31

The amount of $1,096,193.08 is composed of $877,000.55 of fees to Summit Global

Services, LLC for electronic discovery services, PXs MM, SS; $152,624.69 to A2L for

courtroom graphics, PX AA; $5,464.58 to InData Corp. for courtroom graphics, PX JJ;

$45,699.97 of fees to M. Bagdon for services as an in-courtroom display operator, PX BB;

$5,360.00 in licensing fees to Trial Director Service for electronic evidence displays, PX 4 at 26;

$3,455.30 in process server fees, PX EE; $6,361.19 in travel expenses, EX PP; and $226.80 in

electronic research costs, PX QQ.

32

further $133,485.99 of the uncontested costs are reasonable and awardable under both RCFC

54(d) and 28 U.S.C. § 1920.32

The only remaining costs about which the parties disagree, then, are the costs for

FastShip’s appeal to the Federal Circuit. Pl.’s Bill of Cost Reply at 4-5. FastShip states that it

incurred $33,450.30 of expenses on appeal. Id. But the decision of the Federal Circuit in

affirming the decision of this court explicitly stated that “[e]ach party shall bear its own costs.”

See FastShip IV, 892 F.3d at 1311. As this court has no power to override a decision by the

appellate court, it cannot award these fees related to the appeal and sought by FastShip. See,

e.g., Hitkansut, 142 Fed. Cl. at 366 (citing 28 U.S.C. § 1920(1)-(5); Fed. Cir. R. 39 (Practice

Notes)).

There is, however, a discrepancy of $16,606.25 between the costs agreed to by the parties

($1,229,679.07) and the number requested by FastShip with the costs for the appeal to the

Federal Circuit removed ($1,279,735.62 - $33,450.30). The government mentioned this amount

at the hearing on April 3, 2019, stating that they “could not reconcile” this amount with the

numbers of the bill of costs. Hr’g Tr. at 58:8-9. The discrepancy may be costs related to

FastShip’s preparation of the present motions for attorneys’ fees and bill of costs. See Pl.’s Cost

Br. at 42; Pl.’s Bill of Cost Reply at 5. But FastShip does not provide any details regarding the

$16,606.25 difference, nor has FastShip timely filed a supplemental cost application for fees

incurred from the original filing of its cost application. Instead, FastShip attempts to reserve the

right for “any additional costs and related expenses reasonably incurred from the time this reply

is filed.” Pl.’s Bill of Cost Reply at 6. Yet at some point the litigation must end. FastShip

cannot continue to recover fees ad infinitum from each subsequent filing. See Hitkansut, 142

Fed. Cl. at 360 (citing Jean, 496 U.S. at 163 (warning of a “‘nightmare’ of infinite litigation to

recover fees.”); Bratcher v. United States, 138 Fed. Cl. 543, 547 (2018)). Therefore, the court

awards FastShip $1,229,679.07 in costs.

CONCLUSION

For the forgoing reasons, FastShip’s motion for attorneys’ fees and related expenses and

bill of costs under 28 U.S.C. § 1498(a) is GRANTED IN PART and DENIED IN PART.

FastShip is awarded $6,178,288.29 in attorneys’ fees and related expenses. FastShip is also

32

The amount of $133,485.99 is composed of $77,179.18 of costs for certification or

duplication, $28,293.67 for fees of the reporter used for all or any part of the trial, $855.00 for

fees of the Clerk of the Court of Federal Claims, $1,400.00 for witness fees, and $25,758.14 for

costs incidental to the taking of depositions. Def.’s Objs. at 5.

There is some confusion regarding the costs incident to taking depositions that FastShip

requests. The government states that it cannot reconcile the $25,758.14 requested by FastShip

on Form 4 with the specific, itemized costs it requests in its brief. See Def.’s Objs. at 5 & n.2.

FastShip, in its reply, argues that the government omitted $2,879.65 in costs related to the

deposition of Donald Blount on June 2, 2016. See Pl.’s Bill of Cost Reply at 3-4. After

reviewing the support provided by FastShip, the court concurs with FastShip that the

government’s error was due to the omission of the $2,879.65 related to Mr. Blount’s deposition

and will include this number in the final calculation.

33

awarded $1,229,679.07 in costs. The Clerk shall therefore enter final judgment for FastShip for

a total amount of $7,407,967.36.

It is so ORDERED.

s/ Charles F. Lettow

Charles F. Lettow

Senior Judge

34