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Contractor Challenges Fee Request in False Claims Act Case

April 3, 2019 | Posted in : Challenging Fees, Expenses / Costs, Fee Dispute, Fee Request, Fees for Fees, Hourly Rates / Hourly Billing

A recent Law 360 story by Michael Phillis, “Contractor Fights ‘Cash Grab’ Fee Request in FCA Suit,” reports that a joint venture that included Bechtel Group blasted a whistleblower's bid for nearly $2 million in attorney fees and expenses as a "cash grab" after the contractor agreed to pay $3.2 million to resolve claims it lied about its subcontractors at a nuclear waste cleanup.  Washington Closure Hanford LLC told a Washington federal court that whistleblower Salina Savage and Savage Logistics LLC’s request for nearly $2 million in attorney fees, expenses and “fees on fees” was based on an elevated hourly rate of $800 and was generally unreasonable.  According to the memorandum filed, an appropriate fee award would be roughly $300,000 after applying a $150 to $400 per-hour rate.

The U.S. Department of Justice in June announced it settled the False Claims Act case for $3.2 million, ending accusations that WCH — a joint venture of AECOM, Bechtel and CH2M Hill Cos. Ltd. — made misrepresentations about its subcontractors while doing nuclear waste cleanup work at the Hanford Site in Washington state.  Savage and her company Savage Logistics, which received a $643,000 cut of the settlement, originally filed the suit against WCH in 2010 after having unsuccessfully bid on subcontract work.  Any attorney fees awarded would be on top of that amount.

“If the court grants Savage’s exorbitant request, Savage would recover nearly $2.6 million from WCH for a case litigated primarily between WCH and the [U.S. Department of Justice] that settled for $3.2 million,” the memorandum said.  “Savage’s motion is nothing more than a cash grab by a relator whose efforts did little to bring the case to resolution.”  WCH responded to what it said was an overblown request by Savage in March for a too-large share of fees.

According to WCH, Savage’s fee request was based on an inflated hourly rate that was inappropriate for the local area in which the litigation occurred.  It asked for too many hours and Savage was only involved in part of the litigation, which mainly was pursued by the federal government, which intervened in the suit.  “WCH spent its time and resources after intervention defending against the DOJ, not against Savage,” the memorandum said.  “The small number of hours worked by Savage’s counsel reflects only her limited role after intervention.”

In its request for fees, Savage said her efforts and those of her attorneys took years and resulted in an important settlement.  That work should be properly considered and compensated, according to court filings.  “Work performed by the attorneys securing the government’s participation and presenting Savage’s case to the court has created invaluable precedent over the viability of — and measure of damages in — False Claims Act cases predicated on false small-business certifications,” Savage’s March filing said.

Marisa Bavand, an attorney with Groff Murphy PLLC who represents WCH, said the fee request was "inflated."  "[The memorandum] also highlights the highly improper costs Savage is seeking to recover including costs associated with her personal office, undisclosed “interns,” copy paper and various other costs that are not recoverable," Bavand told Law360 in an email.

The case is United States of America et al. v. Washington Closure Hanford LLC et al., case number 2:10-cv-05051, in the U.S. District Court for the Eastern District of Washington.