At The Weisblatt Firm, our legal team supports all types of businesses, including hedge funds. The restaurant started as a pop-up during the pandemic and later turned into a brick-and-mortar space, closing for four months of renovations and reopening in May. Eugene Volokh is the Gary T. Schwartz Distinguished Professor of Law at UCLA. This only happens if legislators Republican senators, especially are motivated to, act, she said. The programs administrator, the U.S. Small Business Administration, hadnt hidden that preference, just as it had acknowledged setting aside $5 billion of the funds $28.6 billion for very small restaurant companies. As courts debated the fund's fate, thousands of restaurants were left in limbo. In a similar lawsuit filed by Eric Nyman, owner of the Penn Hotel Sports & Raw Bar and Janice and Jason Smith, owners of the Lost Cajun in Keller, Texas, Judge Reed OConnor ruled on May 28 that the SBA must dole out grants in accordance with a race-neutral, sex-neutral first come, first served policy. The Lost Cajun was approved for an award on May 29, and though the Penn Hotel Sports & Raw Bars case was under review for slightly longer (since the restaurant sought more than $300,000), both restaurants received grants on June 1. Attorneys for the federal government said people could also check a box on the application if they thought they met the broader definition of socially and economically disadvantaged, the judge wrote. By submitting your email, you agree to our, The freshest news from the local food world, Two Trump Cronies and a DFW Restaurant Are Behind the Lawsuit Preventing Minority-Owned Businesses From Receiving Restaurant Revitalization Fund Relief, Sign up for the But a new federal lawsuit filed Wednesday by a conservative law firm claims that's discrimination. The U.S. District Court for the Northern District of Texas on June 11 ordered a halt to payments from the Small Business Administrations Restaurant Revitalization Fund, which is part of President Joe Bidens $1.9 trillion economic stimulus plan passed by The SBA, tasked with managing the relief funds, announced on May 10 that 16,000 businesses were approved for grants totaling $2 billion in just the first week. Penn Hotel Sports & Raw Bar got $640,425; Lost Cajun received The legal complaint argues that the fund requires the SBA to discriminate among restaurants according to the race and sex of the owner, by specifying that during the first 21 days of the program that officially began last week, the SBA administrator must prioritize awarding grants to businesses owned by women and racial minorities., These race and sex preferences are patently unconstitutional, and the Court should promptly enjoin their enforcement. A bipartisan group of lawmakers, according to the Hill,onJune 10 introduced the Restaurant Revitalization Fund Replenishment Actof2021 to add an additional $60 billion to the fund. By May 15, the fund received 147,000 applications from the prioritized group requesting $29 billion in relief funds, according to the SBA. Roughly $2.7 billion have already been administered to 21,000 restaurants under the program, the AP noted. The Bill furthermore constructed a government and bill of rights for the island and allowed its residents to serve in the U.S. military.In 1952, the rights of Puerto Rico and its residents were further extended when the island promulgated its own constitution. On Friday, June 11, the Small Business Administration paused the disbursement of pandemic relief funds to thousands of minority-owned businesses. At issue in their latest suit is the $28.6 billion Restaurant Revitalization Fund created by the Biden administrations American Rescue Plan Act and launched earlier this month. Greer filed suit, claiming that the SBAs policy violates the Equal Protection Clause of the Constitution. Staggering snowfall in California mountains leaves residents trapped for days, SpaceX launches new crew on flight to space station, Prosecution wraps case at Alex Murdaugh murder trial, Explosive found in checked luggage at Pennsylvania airport, feds say, FDA authorizes first at-home test for both COVID and flu, Couple accuses fertility clinic of implanting embryo with cancer genes, Several hospitalized after Lufthansa flight diverted to Dulles due to turbulence, Colon cancer rates rising in younger age group, study finds, Firefighter dies battling blaze in downtown Buffalo, mayor says, Biden talks stimulus funds for restaurants, Biden talks federal stimulus funding for restaurants, Top McCarthy aide, House Oversight chair each met with Ashli Babbitt's mother, Pence won't commit to supporting Trump if he's the nominee, Garland testifies before Senate panel amid ongoing special counsel probes, Report finds FBI, Capitol Police didn't share "credible threats" before Jan. 6, Biden tells Democrats to talk about their accomplishments, to provide relief to hard-hit restaurants and bars, group of farmers sued the federal government. The owner of Bangkok 96 Street Food inside the Detroit Shipping Co.in Detroit applied for and received funds. "The simplest solution to all of it, all of the problems with the lawsuits and everything else goes away if you refill the fund," Polmar said in an interview. /sites/all/themes/penton_subtheme_nrn/images/logos/footer.png. The RRFs funding ran out at the end of the 21-day period, or much faster than expected, prompting three applicants outside of the preference groups to file lawsuits. And its cuts must be informed by data that suggest intentional discrimination. Members help make our journalism possible. The IRC offers several resources on its site including a tool to quickly contact elected representatives. She's spent the last 10 years writing about restaurant technology and the future of hospitality and was among the first journalists to cover these topics with regularity. A lawsuiton behalf of the operator of the Lost Cajun restaurantin Texaswas filed by America First Legal, a legal group founded by Stephen Miller and Mark Meadows, former aides to President Donald Trump, according to Reuters. WebContact LPG. Nearly 3,000 restaurateurs approved to receive a Restaurant Revitalization Fund (RRF) grants have been alerted that they wont be getting the money because of court cases that challenge a d their selection on the basis of gender or race. The suit alleges that the Smiths are being subjected to unconstitutional race and sex discrimination by the priorities that the statute commands for minority- and women-owned businesses, and that because more than half of the requests for Restaurant Revitalization Fund monies were made by business owners under those categories, its possible that the entire $28.6 billion that Congress allocated to the Restaurant Revitalization Fund will be depleted before the plaintiffs can even be considered for relief under the program.. This case underscores that there was a lot of nervousness in the restaurant industry that the $28.6 billion was going to go fast, Sean Kennedy, vice president for public affairs with the National Restaurant Association told Nations Restaurant News. According to the lawsuit, Janice Smith and Jason Smith applied for assistance from the Restaurant Revitalization Fund on May 5 and discovered that they were entitled This is not the first lawsuit filed against a federal program aimed at helping disadvantaged groups hurt by the pandemic. A little over a week later, more restaurant owners received emails telling them that their previously approved grants would not be disbursed. The Wisconsin Institute for Law and Liberty (WILL) suedon behalfof Antonio Vitolo, the owner of Jake's Bar and Grill in Harriman, Tennessee,according to the Hill. The nearly 3,000 restaurants whose application approvals were rescinded will be paid once it completes processing all previously filed non-priority applications, and only then if the RRF is not first exhausted, the SBA told The New York Times. However, the majority stated that the decision would not be moot because the racial and sex-based priorities continue to impact the continued distribution of the funds, even though the 21-day period is over. The owner of a weddings and events business in New York City contacted couples to say she would soon be able to refund some of the money they put down as a deposit on their canceled 2020 weddings. The lawsuit claims the agency discriminated against defendant Antonio Vitolo, who owns Jake's Bar and Grill in Harriman, Tennessee, because as a White man he was not eligible for priority treatment, even though his wife and co-owner is a Hispanic woman. The SBA previously dropped prioritization of women and minority-owned businesses and rescinded payments promised to almost 3,000 restaurants following these three lawsuits, 2023 Informa USA, Inc., All rights reserved, The Penn Hotel Sports and Raw Bar / Facebook, Denny's raises over $1.2 million to fight childhood hunger in 12th annual No Kid Hungry fundraiser, Bojangles names Tom Boland as new chief marketing officer, Baskin-Robbins rolls out chicken-and-waffle flavored ice cream, How Jersey Mike's is becoming 'America's sandwich shop', Nations Restaurant News launches new CREATE Roadshow event series, San Diegos Trust Restaurant Group drives retention, innovation with culture of yes, Tech Tracker: Restaurant QR codes are evolving and so should yours, Congress introduces a $60 billion replenishment of the Restaurant Revitalization Fund, SBA data confirms that the current Restaurant Revitalization Fund cant meet demand, Allowed HTML tags: . The recognizing date of the exempt status is September, 2022. She called the SBA's hotline and was told the money was on its way. A group of farmers sued the federal government charging the administration's efforts to help minority farmers through a COVID-related loan forgiveness program was discriminatory. Veronique de Rugy The first three weeks of the program prioritized certain groups of business owners in the name of equity. The restaurants that sued the SBA for discrimination received almost $1 million in Restaurant Revitalization Fund grants The SBA previously dropped prioritization of A $28.6 billion federal restaurant aid fund has in its first week received more than 266,000 applications from struggling restaurants, many of which come from the A letter obtained by Nation's Restaurant News told those applicants awaiting funds: The SBA is not able to pay 2,965 priority applicants including yourself who were previously approved and notified of their approval. A $28.6 billion federal restaurant aid fund has in its first week received more than 266,000 applications from struggling restaurants, many of which come from the women- and minority-owned businesses the fund is prioritizing. Greers lawsuit was backed by the America First Legal Foundation, whose president is former Trump Administration senior adviser Stephen Miller, architect of that administrations infamous Muslim travel ban. But not everyone waseligible or will receive funds. newsletter, Sign up for the Thousands more restaurants received approval notices in the weeks following and were told to expect funds in their bank account within seven business days. The SBA argued that the government has a compelling interest in redressing the effects of past and present discrimination against minority-owned small businesses and that the prioritization scheme furthers that interest. In determining the degree of diminished credit and capital opportunities the Administration shall consider, but not be limited to, the assets and net worth of such socially disadvantaged individual." Follow @SusanMariecooks on Twitter. His earlier misses? Defendants propose as the government's compelling interest "remedying the effects of past and present discrimination" by "supporting small businesses owned by socially and economically disadvantaged small business owners who have borne an outsized burden of economic harms of [the] COVID-19 pandemic." Philip Greer, the owner of a cafe in Texas, wanted to apply to the Small Business Administrations Restaurant Revitalization Fund (RRF) for help after his cafe lost $100,000 in revenue because of the pandemic. To get the Volokh Conspiracy Daily e-mail, please sign up here. Weeks later, approvals in-hand, they learned that the relief funds they were promised weren't coming. Furthering the long tradition of public and private sector efforts to break down barriers,DoorDashis proud to support Black-owned businesses and honored to do our part to lift up those who need it most., /sites/all/themes/penton_subtheme_nrn/images/logos/footer.png. In a recent Zoom call with independent restaurant operators, Erika Polmar, executive director of the Independent Restaurant Coalition (IRC) said that it's unlikely the measure will pass as a standalone bill, but instead might be added to a reconciliation package like the bipartisan infrastructure package, potentially in July. "There are $50 billion of applications that are pending right now that are not going to be funded, because the federal dollars aren't there," he said. Thousands of others lost out on aid they were expecting thanks to lawsuits backed by conservative groups. U.S. District Judge Travis R. McDonoughsoriginal ruling stated that the plaintiffs argument had failed to rebut the federal governments priority in halting the impacts of historical discrimination based on sex and race. As a report from The Counter noted, this sort of prioritization is not atypical for the SBA which has a history of supporting programs that target disadvantaged groups of business owners. The fund itself was based on the RESTAURANTS Act, a congressional proposal that sought $120 billion in direct aid to independent restaurants. 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