Justice Department Drops Appeal of Federal Court Ruling

The U.S. Department of Justice has dropped its appeal of a ruling by the U.S. District Court for the Northern District of California awarding legal fees to the American Small Business League (ASBL). The case was scheduled to be heard by the 9th Circuit Court of Appeals early next year. (http://www.asbl.com/documents/order_dismissingAppeal_SBA_names.pdf, http://www.asbl.com/documents/motion_dismissAppeal_SBA_Fees.pdf)

Prior to dropping its appeal, the Justice Department offered to drop its appeal of the District Court's ruling for attorney's fees if the ASBL agreed to waive legal fees it incurred during the appellant process. The ASBL declined the Justice Department's offer stating that it preferred to have the case heard by the 9th Circuit Court of Appeals.

The ASBL requested the specific names of the firms that were coded as small businesses for FY 2005 and 2006 and the specific dollar amounts that were awarded to those firms from the U.S. Small Business Administration (SBA). The request was made under the Freedom of Information Act (FOIA).

The SBA refused to comply with the ASBL's request for the data. During litigation, the SBA claimed that it had no information in its possession regarding the specific names of firms that had received federal small business contracts.

In the court's ruling, United States District Judge Marilyn H. Patel stated, "The court finds it curious the SBA's argument that it does not 'control' the very information it needs to carry out its duties and functions." (www.asbl.com/documents/26-2.pdf)

As a result of Patel's ruling, the SBA was ordered to turn over the requested information and pay all of the legal fees incurred by the ASBL during the initial litigation process. The information the ASBL finally obtained indicated that the SBA, the General Services Administration (GSA) and virtually every other federal agency diverted billions of dollars in federal small business contracts to Fortune 500 firms and dozens of large businesses in Europe and Asia. (http://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)

Some of the firms that received federal small business contracts included Boeing, Lockheed Martin, Northrop Grumman, Raytheon, General Dynamics, GTSI, Rolls-Royce, Dell Computer, Thales Communications, and British Aerospace (BAE).

The ASBL has estimated that legitimate small businesses are losing over $100 billion a year in federal small business contracts to corporate giants.

The ASBL drafted legislation titled, the Fairness and Transparency in Contracting Act, or H.R. 2568, which would halt the flow of federal small business contracts to large businesses. On May 21, 2009, Congressman Hank Johnson (D-GA-4) introduced the bill into the U.S. House of Representatives. To date, the bill has 15 co-sponsors and has been endorsed by more than 50 chambers of commerce and business organizations around the country.

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Comments

[Caleb Kwong]

How many times are small businesses going to get the shaft? Lloyd I appreciate you bring this to the public's attention. Hopefully the government will make changes in the legislation to prevent large business from taking advantage of small businesses. Obama is suppose to stand for hope for our country, lets see if he makes a difference.

[truthtimeisnow]

"The court finds it curious the SBA's argument that it does not 'control' the very information it needs to carry out its duties and functions."

HAHAHA.... This is the stuff that real comedies are made out of. Thank you government officials for coming out with an excuse tantamount to "the dog ate my homework."

Question: Where is the accountability?

[tarend]

Why am I not surprised? The Dept of Justice had absolutely no leg to stand on. They think they can just play the bully role and push around the litle guy until the little guy goes away. They didn't count on Lloyd and the ASBL coming back to the playground with a baseball bat and friends.

Keep up the good work Lloyd!

[Radar423]

I think they are just trying to drag it out and see if people like Lloyd run out of money and just go away.

Is there anything we can do to send money to the ASBL? I think they are doing a great job and would love to support the cause.

[Lloyd Chapman - Huffpost Blogger]

Radar, thank you for your support. You and any other concerned citizens can donate to or join the ASBL by visiting http://www.asbl.com/joinasbl.html.

[Ashki]

Why would the SBA try to hide this information, UNLESS, there is a lot to hide. That is just sad to think that our tax dollars are funding the SBA. The SBA is basically cheating out American small businesses, the same businesses that the SBA was created to protect. SAD

[GrimJack]

well of course they would drop the case before going to the precedent-setting 9th circuit court because they had no case. it amazes me sometimes how the government will fight so hard to defend what they know if wrong...keep up the good work Lloyd