I haven't been following the case closely, but the consensus (even in the view of the plaintiff and the judge) is that the agent misinterpreted the instructions for completing the form, which led to him marking the wrong box on it.
People aren't complaining about the mistake itself, but about the US government requiring Ibrahim to spent 8 years and $3.5 million dollars to correct the mistake. They could have done a review when the lawsuit was filed, and they could have agreed to settle the lawsuit after the mistake came to light during depositions. As far as we know, they didn't do either of those. That's what the gp is implying might be exceptional and worthy of awarding fees.
