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ABEL CONVERTING, INC. v. UNITED STATES

July 15, 1988

ABEL CONVERTING, INC., Plaintiff,
v.
THE UNITED STATES, ET AL., Defendants



The opinion of the court was delivered by: GASCH

 OLIVER GASCH, SENIOR UNITED STATES DISTRICT JUDGE

 After hearings on plaintiff's application for a temporary restraining order and motion for preliminary injunction both of which were granted, the Court entered final judgment for plaintiff on March 16, 1988. Plaintiff, a small paper towel manufacturer, now seeks an award of attorney's fees under the Equal Access to Justice Act, 28 U.S.C. § 2412(d)(1) (1982 & Supp.).

 I. BACKGROUND

 In July 1987, the General Services Administration ("GSA") solicited bids for a two-year contract for the purchase of a variety of paper towel products. Plaintiff was the incumbent contractor, but no copy of the solicitation was mailed to it. Direct notification of incumbents is expressly required by GSA regulations, 48 C.F.R. § 514.203-1(b), and implicitly required by the Federal Acquisition Regulations, id. § 14.205-1 and the Competition in Contracting Act ("CICA"), 41 U.S.C. § 251 et seq.

 Dissatisfied with the partial remedy recommended by the GAO, plaintiff filed suit seeking temporary and permanent injunctive relief against award of a contract by GSA under the faulty solicitation and directing GSA to resolicit bids for all thirty-three items originally appearing in the solicitation. Finding no basis for GSA's failure to mail a solicitation packet to plaintiff, the Court granted plaintiff's application for a temporary restraining order. After a prolonged hearing and extensive briefing, the Court preliminarily enjoined GSA from awarding any contracts under the solicitation. Abel Converting, Inc. v. United States, 679 F. Supp. 1133, 1142 (D.D.C. 1988). *fn1"

 Throughout this litigation the parties negotiated for settlement but were unable to reach a compromise acceptable to all. Because the GSA announced an intention to resolicit all thirty-three items and intervenors withdrew resistance to this proposal, see. e.g., Order, Abel Converting, Inc. v. United States, 1988 U.S. Dist. LEXIS 16544 Civil Action No. 88-0177-OG (filed Mar. 10, 1988) (granting defendant-intervenor Fort Howard's motion to dismiss voluntarily its cross claim), the Court entered judgment for plaintiff on March 16, 1988. Plaintiff now moves for an award of attorney's fees and expenses under EAJA.

 II. DISCUSSION

 The EAJA authorizes an award of attorney's fees and expenses against the United States

 
in any civil action (other than cases sounding in tort), including proceedings for judicial review of agency action, brought by or against the United States in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.

 28 U.S.C. § 2412(d)(1)(A). The benefits of EAJA do not inure, however, to all litigants who challenge the United States. To qualify for these benefits, a corporation must be the prevailing party, must have a net worth of no more than $ 7,000,000, and must employ no more than 500 employees. Id. §§ 2412(d)(1)(B) & (d)(2)(B).

 The government does not contest plaintiff's capacity to qualify for an award under EAJA. Instead, the parties' dispute focuses on whether the treatment of plaintiff's protest by the GSA was substantially justified. The GSA also insists that ...


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