ATI Government Solutions filed a lawsuit against the U.S. Small Business Administration and its administrator, Kelly Loeffler, alleging that the agency improperly suspended the company from federal contracts based on a deceptive video, based on information published by CRN.
The Frederick, Maryland-based company alleges that the SBA acted on an edited video produced by activist James O’Keefe, which featured a former employee discussing business practices. The lawsuit claims the SBA failed to conduct a proper investigation and instead invoked the Federal Acquisition Regulation to suspend the firm and its affiliates without adequate evidence. ATI Government Solutions, which is owned by the Susanville Indian Rancheria Tribe, asserts that the suspension has resulted in the loss of $130 million in active contracts and over $500 million in prospective business.
The company further alleges that the SBA used the incident to justify a broader audit of the 8(a) Business Development program. Following the suspension, the firm was forced to terminate nearly all of its 67 employees. The lawsuit seeks to have the suspensions declared unlawful and requests that the court lift the restrictions, citing a lack of due process and reliance on misleading online content. The SBA has declined to comment on the active litigation.
Source: CRN
