. We The Penn Hotel Sports and Raw Bar was one restaurant that filed aa lawsuit for discrimination and received funds. "I'm going to try to restart my business because I have no choice other than personal bankruptcy," she said. Restaurant Revitalization Fund Replenishment Act of 2021 On June 11, 2021, Congress introduced the Restaurant Revitalization Fund Replenishment Act of 2021 to replenish the fund with $60 billion. These business owners had their Restaurant Revitalization Fund grant applications approved as part of a program that prioritized traditionally underserved owners women, veterans, people of color, and other disadvantaged groups. 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. ): Plaintiff Philip Greer owns and operates Plaintiff Greer's Ranch Cafa restaurant which lost nearly $100,000 in gross revenue during the COVID-19 pandemic . newsletter, the Small Business Administration paused the disbursement of pandemic relief funds to thousands of minority-owned businesses, founded by Stephen Miller and Mark Meadows, both aides to former president Donald Trump, just requires that the Small Business Administration prioritize applications from women-owned, minority-owned, and veteran-owned businesses for the first 21 days that applications are open, also alleged that the program was discriminating against white people by prioritizing minority-owned businesses, appellate court later overturned McDonoughs decision, Biden administration has vowed that it will continue to fight the Texas judges injunction in court, U.S. SBA halts some grants under injunction in lawsuit filed by white restaurant owners, Everything Restaurants Need to Know About the Restaurant Revitalization Fund. Over the weekend, the SBA notified 2,965 previously approved priority Restaurant Revitalization Fund applicants in a form email that it will be unable to pay the promised grants due to the outcome of the lawsuits in Texas and Tennessee thatbarred the SBAfrom distributing grantson the basis of race and sex. Related: SBA data confirms that the current Restaurant Revitalization Fund cant meet demand. Not Great, What the Second Round of CARES Act Funding Means for Restaurants, The Coronavirus Stimulus Package: What Everyone in the Restaurant Industry Should Know, Help Is on the Way for Restaurants. At The Weisblatt Firm, our legal team supports all types of businesses, including hedge funds. 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 Cookies collect information about your preferences and your devices and are used to make the site work as you expect it to, to understand how you interact with the site, and to show advertisements that are targeted to your interests. Prioritizing the applicants was mandated byCongress. 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:

. 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. 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. The communication did not say whether the SBA would pursue a judicial or legislative remedy. There may be hope for those who missed a chance at funding. We've never been in that position before," said Mariah Pisha-Duffly, a co-owner. Greer seeks monetary relief under the $28.6-billion Restaurant Revitalization Fund ("RRF") created by the American Rescue Plan Act of 2021 ("ARPA") and administered In the US District Court for the Northern District of Texas, Judge Reed OConnor, found that the defendants lack[ed] the industry-specific inquiry needed to support a compelling interest for a government-imposed racial classification. OConnor concluded that the evidence shows Greer will suffer irreparable harm because the RRF will likely run out of money before his restaurant could even be considered for relief. These race and sex preferences are patently unconstitutional, and the Court should promptly enjoin their enforcement. . The Small Business Administration declined to comment on pending litigation. She's the founder of Expedite, a weekly restaurant technology newsletter highlighting news and big ideas about the future of the restaurant industry. 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. 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. To get the Volokh Conspiracy Daily e-mail, please sign up here. The SBA argued that the decision would be moot as most of the Restaurant Revitalization Funds have already been distributed and the decision would not retroactively re-collect them. Eugene Volokh is the Gary T. Schwartz Distinguished Professor of Law at UCLA. We remain committed to doing everything we can to support disadvantaged businesses in getting the help they need to recover from this historic pandemic and restore livelihoods.". SBAs leadership is frustrated with this outcome and remains committed to doing everything we can to support disadvantaged businesses getting the help they need to recover from this historic pandemic, the letter stated. WebSouth China receives no funding from any government for the production of this publication. Roughly $2.7 billion have already been administered to 21,000 restaurants under the program, the AP noted. The lawsuit targets the three-week period from May 3 until Monday during which the $28.6 billion Restaurant Revitalization Fund has only been processing and funding requests from businesses owned by women; veterans; or socially and economically disadvantaged individuals. Lindsay Mescher, owner of Greenhouse Cafe in Lebanon, Ohio said she started to get nervous after eight or nine days passed with no bank deposit. 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. 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 owners of the Lost Cajun are white and claim that the decision does not provide them equal protection under the law, as required by the United States Constitution. In at least one instance, the plaintiff was assisted in bringing the legal action by a conservative group that objected to the SBAs acknowledged bias. Plaintiff Antonio Vitolo, owner of Jakes Bar and Grill in Harriman, Tennessee, applied for aid on May 3 but doesnt qualify as a white male, according to the lawsuit, which argues white men are being pushed to the back of the line for aid for their eateries. Greer seeks monetary relief under the $28.6-billion Restaurant Revitalization Fund ("RRF") created by the American Rescue Plan Act of 2021 ("ARPA") and administered by the Small Business Administration ("SBA"). 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. 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 Vitolo splits the ownership of Jakes Bar & Grill with his wife, who is Hispanic, but the SBA required a business to be at least 51% owned by a woman, veteran and/or socially or economically disadvantaged individual in order to be eligible within the three-week prioritization window. The lawsuit opens the door for a class action suit, in which all restaurant owners and restaurants in the United States who are encountering or who will encounter race or sex discrimination from the Small Business Administration, could be potentially entitled to relief from the court. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. May 13, 2021 / 10:55 AM The $28.6 billion Restaurant Revitalization Fund was a popular program, offering grants to independent restaurants to help cover business losses due to the COVID-19 pandemic. A Sixth Circuit court panel ruled on May 28 that the Small Business Administrations prioritization of Restaurant Revitalization Fund grants on the basis of race and sex for the first 21 days of the program is unconstitutional.