A lawsuit has been filed against President Joe Biden's administration for prioritizing restaurants and bars owned by women and minorities in its COVID-19 relief package, arguing white men are being 'pushed to the back of the line' for aid for their eateries.
The lawsuit, which names U.S. Small Business Association Administrator Isabella Casillas Guzman as the defendant, was filed by a conservative legal outfit on behalf of Antonio Vitolo, the owner of Jake's Bar and Grill in Harriman, Tennessee.
The suit comes after the Biden administration's American Rescue Plan Act established the $28.6 billion Restaurant Revitalization Fund - which the SBA said 'would only process and fund priority group applications' from May 3 to May 24.
Those 'priority groups' include businesses majority-owned by women, veterans, or those who are 'socially and economically disadvantaged' such as applicants 'who have been subjected to racial or ethnic prejudice or cultural bias,' the SBA said.
The lawsuit names U.S. Small Business Association Administrator Isabella Casillas Guzman as the defendant
The lawsuit was filed by the Wisconsin Institute for Law & Liberty on behalf of Antonio Vitolo, the owner of Jake's Bar and Grill in Harriman, Tennessee
A marquee shows Jake's Bar and Grill in Harriman, Tennessee - for whom the lawsuit was filed
Biden has previously said that female-owned and minority-owned businesses have been disproportionately hurt by the COVID-19 economic crisis.
'In March 2021, the United States pushed aside equality under the law by enacting a grant program that gives special treatment based on race and gender,' the Wisconsin Institute for Law & Liberty wrote in the lawsuit.
The suit added that the business was harmed in a number of ways.
'First, they have been pushed to the back of the line, regardless of when they applied, for a limited fund that may run out before their application is processed,' the lawsuit reads.
'Second, even if the fund does not run out, Plaintiffs are harmed by being treated differently because of their race and gender during the application process for a grant under the Restaurant Revitalization Fund program.'
The lawsuit claims that the SBA 'adopted a firstcome, first-serve queue to process grant requests until the money runs out, but has then re-sorted applicants within the queue based on their race and gender.'
The suit claims Vitolo immediately applied for aid May 3 when the SBA started accepting applications but doesn't qualify to receive aid yet because he's a white male. His wife is Hispanic and owns 50% of the restaurant, just shy of the 51% requirement to be considered a women-owned business.
'I do not want special treatment. I just want to be treated equally under the law. I am opposed to race and sex discrimination, and I would hope my government lived up to the same principle,' Vitolo said in a press release from the legal group.
The group argues the gender and race distinctions are unconstitutional and is seeking an immediate halt to payouts under the program until the government starts processing them on a first-come, first-served basis.
'Given the limited pot of funds, this puts white male applicants at significant risk that, by the time their applications are processed, the money will be gone,' the lawsuit reads.
The program relies on a definition of 'socially disadvantaged' that is limited to people 'subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities.'
Groups presumed to be socially disadvantaged include: Black Americans, Hispanic Americans, Native Americans, including Alaska Natives and Native Hawaiians; Asian Pacific Americans; and Subcontinent Asian Americans.
The lawsuit argued that the government 'pushed aside equality' and violated the Constitution
Located in a strip mall, Jake's Bar and Grill menu also sells a number of coronavirus masks, with quippy names such as: 'Socialism Distancing' and a 'False Sense of Security' mask
The Small Business Administration announced on Wednesday that women, veterans, and socially and economically disadvantaged business owners have already applied for $29 billion of funds through more than 147,000 applications.
However, the Restaurant Revitalization Fund was established by the American Rescue Plan Act with just $28.6 billion.
Payments totaling $2.7 billion have already been sent out to 21,000 restaurants, officials said.
Beyond just the initial priority groups, the administration said it has received more than 266,000 applications total, representing more than $65 billion.
Officials said the application portal will remain open because the administration still has potential money available for businesses with 2019 annual revenue of $50,000 or less.
'The numbers show that we´ve been particularly successful at reaching the smallest restaurants and underserved communities that have struggled to access relief,' said Guzman, the administrator, in a statement.
The program extends to other similar types of businesses that meet a threshold for on-site eating and drinking, from bakeries to breweries.
The U.S. Department of Justice and a Small Business Administration spokesperson did not immediately respond to requests for comment on the lawsuit.
The Wisconsin Institute for Law & Liberty similarly has spearheaded a lawsuit against the Biden administration on behalf of white Midwestern farmers over another portion of the $1.9 trillion coronavirus relief package, alleging last month that they can't participate in a COVID-19 loan forgiveness program because they're white.
Under the Biden restaurant relief program, restaurants and bars can qualify for grants equal to their pandemic-related revenue losses, with a cap of $10 million per business and $5 million per location.
The program has set aside $9.5 billion for the smallest restaurants and bars, and a third of the applications were filed by businesses with annual pre-pandemic revenues of less than $500,000.
Located in a strip mall, Jake's Bar and Grill menu also sells a number of coronavirus masks, with quippy names such as: 'Socialism Distancing,' 'Defund the Media', 'Masks are a Door to 1984', 'Resist Tyranny' and a 'False Sense of Security' mask.
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