Qui Tam Complaint — US ex rel. Eiyo Bowl v. Forward Arts Foundation (N.D. Ga.)

Record facts

United States District Court, Northern District of Georgia, Atlanta Division · No. 1:24-cv-04685-TWT · Doc. 1 · 2024-10-15 · Docket on CourtListener

Full text

1 
IN THE UNITED STATES DISTRICT COURT 
FOR THE NORTHERN DISTRICT OF GEORGIA 
ATLANTA DIVISION 
 
UNITED STATES OF AMERICA  
ex rel.  
EIYO BOWL LLC, 
Plaintiff/Relator, 
v. 
FORWARD ARTS FOUNDATION, INC.; 
JEANNE BOWDEN; ATLANTIC 
GRILL, LLC; ATLANTIC GRILL 
HOLDINGS, LLC; PAUL SACHETTI; 
SEAN M. BISHOP; and REGINALD 
STOTTS, 
Defendants. 
Case No.: 1:24-cv-____________ 
QUI TAM COMPLAINT 
FILED UNDER SEAL PURSUANT TO  
31 U.S.C. § 3730(b)(2) 
JURY TRIAL DEMANDED 
 
 
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TABLE OF CONTENTS 
Page 
I. 
INTRODUCTION ........................................................................................... 3 
II. 
JURISDICTION AND VENUE ...................................................................... 4 
III. 
PARTIES ......................................................................................................... 5 
A. 
Relator ................................................................................................... 5 
B. 
Defendants ............................................................................................. 7 
1. 
Forward Arts Foundation ............................................................ 7 
2. 
Atlantic Grill ............................................................................... 7 
IV. 
STATUTORY AND REGULATORY BACKGROUND .............................. 7 
A. 
The Effects of the COVID-19 Pandemic on the Restaurant 
Industry .................................................................................................. 7 
B. 
The RRF Program ............................................................................... 10 
C. 
The RRF Program Application Process .............................................. 12 
D. 
Priority Status ...................................................................................... 15 
V. 
DEFENDANTS’ FRAUDULENT SCHEMES ............................................ 17 
A. 
Forward Arts Foundation .................................................................... 17 
B. 
Atlantic Grill ........................................................................................ 20 
VI. 
CAUSES OF ACTION .................................................................................. 24 
VII. PRAYER FOR RELIEF ................................................................................ 25 
VIII. JURY DEMAND ........................................................................................... 25 
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COMPLAINT FOR FALSE CLAIMS ACT VIOLATIONS  
 
This action is brought on behalf of the United States of America by Eiyo Bowl 
LLC (“Relator”), by and through its attorneys, against Defendants Forward Arts 
Foundation, Inc.; Jeanne Bowden; Atlantic Grill, LLC; Atlantic Grill Holdings, 
LLC; Paul Sachetti; Sean M. Bishop; and Reginald Stotts (collectively, 
“Defendants”), under the qui tam provisions of the False Claims Act (“FCA”), 31 
U.S.C. §§ 3729-33. 
I. 
INTRODUCTION 
1. 
This is an action to recover damages and civil penalties on behalf of the 
United States arising from false statements and claims that Defendants knowingly 
presented or caused to be presented to the United States and its agents and 
intermediaries, in violation of the FCA. 
2. 
Congress established the Restaurant Revitalization Fund (“RRF”) in 
2021. The RRF was intended to be a multibillion-dollar lifeline for restaurants whose 
business had suffered during the COVID-19 pandemic. The RRF was administered 
by the U.S. Small Business Administration (“SBA”). 
3. 
Under the RRF, an eligible business was entitled to apply for a grant of 
up to $10 million to support its ongoing operations. To ensure that the limited funds 
available through the RRF went only to the businesses that needed them most, 
Congress and the SBA established various rules concerning eligibility for the RRF 
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program. These rules were straightforward, clear, and easily accessible. At all times, 
a potential applicant could consult the SBA’s RRF Program Guide, the SBA website, 
and an online question bank with answers to dozens of questions an applicant might 
have. 
4. 
Most applicants had no difficulty complying with these rules. Several 
businesses, however—either with actual knowledge, deliberate indifference, or 
reckless disregard of the truth—knowingly flouted the RRF eligibility rules to obtain 
money to which they were not entitled. 
5. 
The fraud on the RRF program has doubly harmed American taxpayers. 
First, ineligible businesses have wrongfully obtained tens of millions of dollars to 
which they were not entitled. Second, many businesses that ought to have received 
funding under the RRF program were unable to do so. Every dollar that went to an 
ineligible applicant is a dollar that could have helped an eligible applicant to remain 
solvent and to continue supporting the local economy. 
II. 
JURISDICTION AND VENUE 
6. 
The Court has subject-matter jurisdiction over this action under 31 
U.S.C. § 3732(a) and 28 U.S.C. § 1345. The Court has personal jurisdiction over 
Defendants because, among other things, Defendants Forward Arts Foundation, Inc.; 
Jeanne Bowden; Atlantic Grill, LLC; and Atlantic Grill Holdings, LLC are 
headquartered in or reside in this judicial district. 
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7. 
Venue is proper in this district under 31 U.S.C. § 3732(a) and 28 U.S.C. 
§§ 1391(b) and (c). Acts proscribed by 31 U.S.C. § 3729 occurred in this district. 
Venue is proper in this division under Local Rule 3.1(B) because, among other 
things, Defendants Forward Arts Foundation, Inc.; Jeanne Bowden; Atlantic Grill, 
LLC; and Atlantic Grill Holdings, LLC reside in this division and the cause of action 
against each Defendant arose, in whole or in part, in this division. 
8. 
The claims for relief alleged in this Complaint are timely brought 
because, among other things, Defendants sought to conceal from the United States 
their wrongdoing. 
III. 
PARTIES 
A. 
Relator  
9. 
Relator Eiyo Bowl LLC is a New York corporation headquartered in 
Kings County, New York. Eiyo Bowl LLC does business as AO Bowl. 
10. 
Relator is owned and managed by Zachary Howitt, a New York-based 
entrepreneur and military veteran. In 2019, he fulfilled a longstanding aspiration to 
sign a lease for a new restaurant in New York’s East Village. Inspired by his 
experience in Japan while deployed with the U.S. Navy, Mr. Howitt intended to open 
a restaurant called AO Bowl, serving healthy and affordable bowls and smoothies. 
11. 
The buildout of AO Bowl was complete by April 2020. However, 
because of the COVID-19 pandemic, Mr. Howitt was forced to delay the opening of 
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his restaurant until early 2021.  
12. 
Although the economic devastation of the pandemic ordinarily may 
have convinced Mr. Howitt to close his restaurant, Mr. Howitt was hopeful that the 
RRF program could save his business. Because RRF grants were available only for 
business that were open at the time of their application, Mr. Howitt kept his 
restaurant open, incurring significant debt. Ultimately, AO Bowl did not receive an 
RRF grant and Mr. Howitt was forced to close his business. Although Mr. Howitt 
was able to reopen AO Bowl several months later with a partner, the business 
remains severely indebted after failing to receive assistance from the RRF 
Program—tens of millions of dollars of which went to ineligible businesses instead. 
13. 
Based on his expertise as a restaurateur and his knowledge of the RRF 
program, Mr. Howitt was able to detect and uncover numerous instances of fraud 
whereby ineligible businesses wrongfully obtained RRF grants.  
14. 
Relator has direct knowledge of the conduct alleged in this Complaint 
and conducted an independent investigation to uncover false claims submitted to the 
United States.  
15. 
Accordingly, Relator is an “original source” of the information alleged 
in this Complaint within the meaning of the FCA. 
16. 
Before filing this Complaint, Relator provided the government with 
written disclosure of substantially all material evidence and information that Relator 
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possessed, in accordance with 31 U.S.C. § 3730(b)(2). 
B. 
Defendants  
1. 
Forward Arts Foundation 
17. 
Forward Arts Foundation, Inc. is a Georgia nonprofit corporation 
headquartered at 3130 Slaton Drive NW, Atlanta, GA, 30305. Jeanne Bowden is the 
Chair of Forward Arts Foundation, Inc. 
2. 
Atlantic Grill 
18. 
Atlantic Grill, LLC is a Georgia company headquartered at 1274 
Francis Street NW, Atlanta, GA 30318. Atlantic Grill, LLC was formerly owned and 
operated by Paul Sachetti. It is currently owned and operated by Sean M. Bishop and 
Reginald “Reggie” Stotts. 
19. 
Atlantic Grill Holdings, LLC is a Georgia company headquartered at 
1274 Francis Street NW, Atlanta, GA 30318. Atlantic Grill Holdings, LLC is owned 
and operated by Sean M. Bishop and Reginald “Reggie” Stotts. 
IV. 
STATUTORY AND REGULATORY BACKGROUND 
A. 
The Effects of the COVID-19 Pandemic on the Restaurant Industry  
20. 
The restaurant industry has “a widely embedded, high level of business 
risk”:1 factors outside a restaurant’s control, such as the ability and willingness of 
the public to patronize its business, can have a cataclysmic impact on the restaurant’s 
 
1 Hyoung Ju Song et al., Impact of the COVID-19 Pandemic, Evidence from the U.S. 
Restaurant Industry, 92 Int’l J. Hospitality Mgmt. 102702, at 1 (2021). 
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financial health. “Profit margins in the restaurant industry tend to be extremely thin, 
and many restaurants, even at the best of times, are effectively only one upheaval, 
disaster, or major disruption away from losing viability.”2 
21. 
In 2020, the restaurant industry accounted for more than $300 billion 
in wages3 and about 11 million jobs.4 The industry constituted 4 percent of U.S. 
GDP.5 A major blow to the restaurant industry would result in dire follow-on effects 
throughout the American economy. 
22. 
The COVID-19 pandemic dealt such a blow to the restaurant industry. 
In April 2020, a survey of restaurant operators found that respondents believed their 
businesses had a 72% chance of survival if the pandemic lasted one month, a 30% 
chance of survival if the pandemic lasted four months, and a 15% chance of survival 
if the pandemic lasted six months.6 As public-health measures forced the closure of 
restaurants and domestic and international travel plummeted, the effects of the 
 
2 Jennifer J. Otten et al., The State of the Washington State Food System During 
COVID-19: Taking Stock and Looking Ahead 53-54 (2021), available at 
https://cms.agr.wa.gov/WSDAKentico/Documents/DO/Communications/WAFS-
FinalReport.pdf. 
3 Neil Irwin, One Simple Idea That Explains Why the Economy Is in Great 
Danger, N.Y. Times (Mar. 17, 2020), https://nyti.ms/2QpRyeo. 
4 Charles Lew, As Restaurants Go, So Goes the Economy, Forbes (Apr. 20, 2020), 
https://www.forbes.com/sites/forbesbusinesscouncil/2020/04/20/as-restaurants-go-
so-goes-the-economy. 
5 Id. 
6 Michael G. Brizek et al., Independent Restaurant Operator Perspectives in the 
Wake of the COVID-19 Pandemic, 93 Int’l J. Hospitality Mgmt. 102766, at 1 (2021). 
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pandemic were even worse than many of those respondents feared. Nine months 
after that survey, as the pandemic continued and even worsened, the New York Times 
reported that “no industry has been clobbered like restaurants and bars.”7 The 
experience of Gertie, a popular Brooklyn restaurant, is emblematic of the struggles 
faced by restaurants and bars across the country: 
[In 2019], Gertie made about $30,000 a week, packing dozens of diners 
at a time inside its bright, cavernous dining room. During the worst days 
of the pandemic, it made $50 selling coffee and pastries on some 
mornings, not enough to pay the barista and baker. Sales slowly 
climbed through late summer [2020] to about $1,000 per day.8 
23. 
Even after the most restrictive public-health measured were lifted and 
restaurants implemented safer dining protocols such as outdoor seating and 
advanced air-filtration systems, many potential customers continued to stay home 
instead of dining out. Compounding these challenges, restaurants struggled to pay 
their employees, leading them to quit in droves: every month from January through 
July 2021, five percent of the entire hospitality workforce quit their jobs.9  
 
7 Matthew Haag, Inside One Brooklyn Restaurant’s Desperate Fight to Survive the 
Pandemic, N.Y. Times (Nov. 1, 2020), https://www.nytimes.com/2020/11/01/
nyregion/williamsburg-restaurant-reopening-brooklyn.html. 
8 Id. 
9 Alina Selyukh, Low Pay, No Benefits, Rude Customers: Restaurant Workers Quit 
at Record Rate, NPR (July 20, 2021), https://www.npr.org/2021/07/20/1016081936/
low-pay-no-benefits-rude-customers-restaurant-workers-quit-at-record-rate. 
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24. 
Ultimately, in 2020, “about 72,700 more restaurants and bars than 
normal closed, apparently due to the pandemic, a 95 percent jump over the average 
annual rate.”10 
B. 
The RRF Program 
25. 
In the wake of these catastrophic events, Congress established the RRF 
in March 2021 as part of the American Rescue Plan Act of 2021. The law 
appropriated $28.6 billion in aid for the U.S. Small Business Administration (SBA) 
to distribute to certain businesses in the restaurant industry to offset their losses 
during the pandemic.11 
26. 
The RRF was subject to various restrictions concerning which 
businesses could apply for funds, in what priority their applications would be 
reviewed, and how much funding they were eligible to receive. These requirements 
and limitations, all of which were material to the SBA’s decision to award RRF 
grants, were published in four sources: the RRF statute, the RRF grant application, 
the RRF Program Guide, and the RRF Knowledge Base, all of which have been at 
all relevant times readily available online for the public to view. The RRF Program’s 
restrictions included: 
 
10 Tim Carman, How Many Restaurants Closed from the Pandemic? Here’s Our Best 
Estimate., Wash. Post (June 21, 2022), https://www.washingtonpost.com/food/
2022/06/21/covid-restaurant-closures/. 
11 American Rescue Plan Act of 2021, Pub L. No. 117-2, § 5003(b)(2)(A), 135 Stat. 
4, 86 (Mar. 11, 2021) (codified at 15 U.S.C. § 9009c(b)(2)(A)). 
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x Eligible entity: A business was eligible to receive RRF funding only if it 
was a “business in which the public or patrons assemble for the primary 
purpose of being served food or drink.”12 This included “a restaurant, food 
stand, food truck, food cart, caterer, saloon, inn, tavern, bar, lounge, 
brewpub, tasting room, taproom, licensed facility or premise of a beverage 
alcohol producer where the public may taste, sample, or purchase products, 
or other similar place.”13 
x Restrictions on certain types of businesses: Businesses of the types 
enumerated in 13 C.F.R. § 120.110 were not eligible for the RRF 
Program.14 
x Currently operating: An applicant was eligible to receive funding only 
to support its “ongoing operations.”15 Accordingly, a business was 
ineligible to receive funding if it was permanently closed at the time of its 
grant application.16 
x Amount of funding: The amount of a grant under the RRF was equal to 
the pandemic-related revenue loss of the eligible entity,17 defined for most 
purposes as the entity’s gross receipts during 2020 subtracted from the 
entity’s gross receipts in 2019.18 
x $10 maximum in aggregate funding: Each eligible entity was entitled to 
a maximum of $10 million in aggregate funding and a maximum in $5 
million in funding per physical location of the eligible entity.19 
 
12 15 U.S.C. § 9009c(a)(4)(A). 
13 Id. 
14 SBA, Restaurant Revitalization Funding Program Guide 6 (2021). 
15 15 U.S.C. § 9009c(c)(2)(A)(i). 
16 SBA, Restaurant Revitalization Funding Program Guide 3 (2021); SBA, RRF 
Knowledge 
Base 
– 
Is 
my 
business 
type 
eligible?, 
https://ussbaforgiveness.zendesk.com/hc/en-us/articles/360059869371-Is-my-
business-type-eligible (last visited Sept. 18, 2024). 
17 15 U.S.C. § 9009c(c)(4)(B)(i). 
18 Id. § 9009c(A)(7)(A). 
19 Id. § 9009c(c)(4)(A)(i)-(ii). 
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x Use of funds: A recipient of an RRF grant was permitted to use such funds 
only for ordinary expenses incurred as a direct result of, or during, the 
COVID-19 pandemic.20 If a grantee failed to use all its funds or 
permanently ceased operations on or before March 11, 2023, it was 
required to return any funds not used for allowable expenses to the 
Treasury.21 
C. 
The RRF Program Application Process 
27. 
All applicants for RRF grants were required to, and did, submit their 
applications using SBA Form 3172.22 Generally, applicants were also required to 
provide IRS Form 4506-T, three months of bank statements, their 2019 tax return, 
and documentation showing their 2020 gross receipts.23  
28. 
RRF applications were completed using the SBA’s online portal, using 
a series of drop-down boxes and open-ended form fields to enter the appropriate 
information.24 At all times during the application process, a button titled “Need 
Help” was displayed on the bottom-right corner of the screen: 
 
20 Id. § 9009c(c)(5)(A)-(K). 
21 Id. § 9009c(c)(6). 
22 
Form 
3172 
is 
available 
at 
the 
following 
address: 
https://www.sba.gov/sites/sbagov/files/2021-04/SBA%20Form%203172%20RRF
%20Application%204.20.21-508.pdf. 
23 For applicants that opened in 2020 or later, the SBA required additional 
documentation showing their gross receipts in 2021. For applicants that were not yet 
open on March 11, 2021, the SBA required documentation demonstrating their 
eligible expenses, such as a letter from a third-party accountant with associated profit 
and loss statements and balance sheet documentation. 
24 Screenshots showing various steps in the application portal can be found on the 
SBA’s website: https://www.sba.gov/sites/default/files/2021-04/2021.04.30%20-
%20Application%20Portal%20Sample-508.pdf. 
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29. 
Clicking this button opened a menu with convenient links to the SBA’s 
website, the RRF Program Guide, and the RRF application form. In addition, 
applicants could use a text field to type questions, which would return results from 
the RRF Knowledge Base: 
 
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30. 
Once each applicant submitted its application and supporting 
documents electronically, the applicant was taken to a webpage where it executed a 
DocuSign package to finalize its application. 
31. 
After opening the application process, the SBA was flooded with over 
372,000 applications requesting $76 billion in funds, “far greater than its $28.6 
billion authorized amount.”25  
32. 
In the face of this overwhelming volume of applications, the SBA was 
unable to carefully review every representation made by every applicant to 
determine whether they were true. Rather, RRF applications largely were processed 
on an honor system, with the SBA generally accepting applicants’ representations at 
face value.  
33. 
For instance, if an applicant certified that it belonged to a priority group, 
the SBA automatically assigned the applicant priority status, irrespective of whether 
that certification was true. Likewise, if an applicant certified that it was a restaurant, 
the SBA assumed the business was one where the public gathered primarily for the 
purpose of being served food and drink, without further inquiring or investigating 
whether that was true. 
 
25 Id. 
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34. 
Numerous applicants were able to take advantage of the overwhelming 
and chaotic nature of the RRF application process to receive grants to which they 
were not entitled.  
D. 
Priority Status 
35. 
Under the RRF Program, the SBA was “required to provide priority to 
small businesses owned and controlled by women, veterans, and socially and 
economically disadvantaged individuals and to award grants only to these prioritized 
groups during the initial 21 days that the program was operational.”26 The SBA 
determined that, during the initial 21-day period, it would “accept applications from 
all eligible applicants but would distribute funds only to applicants that self-certified 
their eligibility as a prioritized group. Thereafter, the SBA would distribute grants 
in the order in which they were approved.”27 
36. 
By May 26, 2021—the day before the SBA even began to review non-
priority applications—the agency had already distributed $16 billion to 63,000 self-
certified priority applicants.28 In other words, 56% of the total amount Congress had 
allocated for the entire RRF Program went to just 17% of the applicants—all of 
 
26 Adam G. Levin, Cong. Rsch. Serv., IF1189, SBA Restaurant Revitalization Fund 
Grants 1 (2022), available at https://crsreports.congress.gov/product/pdf/IF/
IF11819; see 15 U.S.C. § 9009c(c)(3)(A).  
27 Levin, supra note 26, at 1. 
28 See id. at 2. 
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whom were awarded priority status based solely on self-certifications.29 By the time 
the SBA began to review non-priority applications, 309,000 applicants were 
competing for just $12.8 billion in remaining funds.30  
37. 
Therefore, an applicant’s representation that it belonged to a priority 
group was an extremely important factor in determining whether the applicant would 
receive an RRF grant at all. An applicant that claimed priority status (and had no 
deficiencies or technical issues with its application) essentially had a 100% chance 
of receiving an RRF grant. An applicant that did not claim priority status had a 12.3% 
chance of receiving a grant.  
38. 
Thus, priority status was akin to a small-business set-aside program in 
which only certain business types enumerated by statute were entitled to a 
significant—and often dispositive—advantage under the RRF Program. 
39. 
Moreover, irrespective of the order in which applications were 
processed, the SBA strongly indicated that misrepresentations as to priority status 
were material to the agency’s decision to award an RRF grant at all. For instance, 
the SBA advised applicants that if they reorganized their ownership for the purpose 
 
29 See id. 
30 See id. 
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of qualification as a priority applicant, such behavior would “result in automatic 
disqualification of the award:”31 
 
V. 
DEFENDANTS’ FRAUDULENT SCHEMES 
40. 
Defendants have engaged in deliberate schemes to fraudulently obtain 
RRF grants by making explicit and implicit false representations on their RRF grant 
applications. 
A. 
Forward Arts Foundation 
41. 
Forward Arts Foundation is a nonprofit organization in Atlanta, 
Georgia that supports the visual arts in Atlanta. Forward Arts Foundation receives 
its revenue from donations, as well as sales from a flea market, a fashion show, a 
 
31 SBA, RRF Knowledge Base – Can I change my business’s ownership in order to 
qualify as a priority group?, https://ussbaforgiveness.zendesk.com/hc/en-
us/articles/360059869171-Can-I-change-my-business-s-ownership-in-order-to-
qualify-as-a-priority-group (last visited Sept. 7, 2024). 
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cookbook, a gift shop, an art gallery, event rentals at its property, and a small 
museum restaurant. 
42. 
Forward Arts Foundation is based at the Swan Coach House, located 
on the grounds of the Atlanta History Center. 
43. 
Forward Arts Foundation is registered as a Domestic Nonprofit 
Corporation with the state of Georgia and as a 501(c)(3) organization with the 
Internal Revenue Service. 
44. 
Forward Arts Foundation was doubly ineligible for the RRF Program. 
First, its primary purpose is not to serve food and drink to the public. Rather, as 
Forward Arts Foundation stated in its Form 990, its mission is “to provide significant 
support to the visual arts in the Atlanta, GA area.” Forward Arts Foundation operates 
a small museum restaurant open 3.5 hours per day, 6 days per week—or 21 hours 
total each week.  
45. 
Second, as a nonprofit organization, it was ineligible as a business 
enumerated in 13 C.F.R. § 120.110. If there were any doubt as to Forward Arts 
Foundation’s eligibility as a nonprofit organization, the SBA resolved this doubt 
with simple and direct guidance via its online Knowledge Base32 and Program 
 
32 SBA, RRF Knowledge Base – What are other eligibility restrictions?, 
https://ussbaforgiveness.zendesk.com/hc/en-us/articles/360059869271-What-are-
other-eligibility-restrictions (last visited Sept. 18, 2024); accord SBA, RRF 
Knowledge Base – Is my business type eligible?, https://ussbaforgiveness.zendesk.
com/hc/en-us/articles/360059869371-Is-my-business-type-eligible 
(last 
visited 
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Guide:33 
 
46. 
In May 2021, Forward Arts Foundation applied for an RRF grant.  In 
its application, Forward Arts Foundation made the following misstatements: 
x Page 3: Applicant Form of Organization. Forward Arts Foundation falsely 
selected “C-Corporation.” 
x Page 3, question 2: Which of the following best describes the Applicant’s 
business? Forward Arts Foundation falsely selected “Restaurant.” 
x Page 10: I further certify that the information provided in this application 
and the information provided in all supporting documents and forms is 
true and accurate in all material respects. Forward Arts Foundation falsely 
initialed beside this statement to indicate it was true. 
 
Sept. 18, 2024) (noting that “any Applicant deemed ineligible by 13 CFR 120.110” 
is “not eligible” for the RRF Program). 
33 SBA, Restaurant Revitalization Funding Program Guide 5 (2021) (stating that 
“All non-profit organizations” are ineligible for the RRF Program). 
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x Page 11: The Applicant is eligible to receive funding under the rules in 
effect at the time this application is submitted. Forward Arts Foundation 
falsely initialed beside this statement to indicate it was true. 
47. 
The foregoing statements were false for the reasons stated above. 
48. 
On June 7, 2021, in express reliance on Forward Arts Foundation’s 
misstatements, the SBA approved Forward Arts Foundation’s application and issued 
grant # 9961769002 in the amount of $752,047. 
B. 
Atlantic Grill 
49. 
Atlantic Grill is an Atlanta restaurant formerly owned by Paul Sachetti. 
The restaurant is operated through Atlantic Grill, LLC. 
50. 
In January 2021, Sachetti began seeking to sell Atlantic Grill. In 
February 2021, Sachetti met with Sean Bishop and Reginald “Reggie” Stotts, a 
married couple interested in purchasing the restaurant. Sachetti agreed to sell the 
restaurant to Bishop and Stotts.  
51. 
On April 26, 2021, Bishop established a new company, Atlantic Grill 
Holdings, LLC. The sale of Atlantic Grill, LLC from Sachetti to Bishop and Stotts 
closed in May 2021. 
52. 
In May 2021, Sachetti applied for an RRF grant on behalf of Atlantic 
Grill, LLC. On May 27, 2021, the SBA approved Atlantic Grill, LLC’s application 
and issued grant # 8610369004 in the amount of $741,118.  
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53. 
Irrespective of the precise date on which the business was sold, Sachetti 
fraudulently procured or fraudulently failed to return these funds. 
54. 
RRF grants were available only to certain eligible businesses, not the 
owners of such businesses.34 RRF grant proceeds were permitted to be used only for 
certain expenses of the recipient business.35 Accordingly, only an owner of the 
business could apply for an RRF grant on behalf of the business:36 
 
55. 
The SBA therefore instructed applicants that a former owner of a 
business was not permitted to apply for an RRF grant on behalf of that business:37 
 
34 15 U.S.C. § 9009c(c)(1). 
35 Id. § 9009c(c)(5). 
36 
SBA, 
Who 
can 
sign 
the 
RRF 
application 
via 
Docusign?, 
https://ussbaforgiveness.zendesk.com/hc/en-us/articles/360059225552-Who-can-
sign-the-RRF-application-via-Docusign (last visited Sept. 8, 2024). 
37 SBA, I sold my business last month, but it incurred loss in revenue for 2020. Am 
I 
eligible 
to 
apply?, 
https://ussbaforgiveness.zendesk.com/hc/en-
us/articles/360060340911-I-sold-my-business-last-month-but-it-incurred-loss-in-
revenue-for-2020-Am-I-eligible-to-apply (last visited Sept. 8, 2024). 
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 21 of 26

 
22 
 
56. 
Moreover, Sachetti certified that Atlantic Grill, LLC was a small 
business concern owned by one or more veterans. Even assuming that Sachetti is a 
veteran, Bishop and Stotts are not. 
57. 
As explained above, an applicant’s representation that it belonged to a 
priority group was an extremely important factor in determining whether the 
applicant would receive an RRF grant at all. 
58. 
Thus, if Sachetti sold Atlantic Grill, LLC prior to applying for the RRF 
grant, Sachetti made the following misstatements:  
x Page 2: Applicant Ownership. Sachetti falsely listed himself as an owner 
of Atlantic Grill, LLC. 
x Page 9: As of the date of this application, Applicant is a small business 
concern at least 51 percent owned and controlled by … Veteran(s). 
Sachetti falsely checked the box next to this option to indicate it was true. 
x Page 9: The authorized representative of the Applicant must self-certify 
that the Applicant is eligible for priority in awarding grants because the 
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 22 of 26

 
23 
Applicant is an eligible small business concern owned and controlled by 
one or more … veterans … by initialing here: ____. Sachetti falsely 
initialed this statement to indicate it was true. 
x Page 10: I further certify that the information provided in this application 
and the information provided in all supporting documents and forms is 
true and accurate in all material respects. Sachetti falsely initialed this 
statement to indicate it was true. 
x Page 11: The Applicant is eligible to receive funding under the rules in 
effect at the time this application is submitted. Sachetti falsely initialed 
beside this statement to indicate it was true. 
59. 
In addition, if Sachetti sold Atlantic Grill, LLC after he applied for the 
RRF grant, he would have been required to return the funds to the Treasury, which 
he failed to do:38 
 
 
38 SBA, RRF Knowledge Base – How do I apply if I acquired an eligible business? 
Can 
I 
sell 
my 
business 
after 
I 
receive 
RRF 
funding?, 
https://ussbaforgiveness.zendesk.com/hc/en-us/articles/360059662271-How-do-I-
apply-if-I-acquired-an-eligible-business-Can-I-sell-my-business-after-I-receive-
RRF-funding (last visited Sept. 18, 2024). 
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 23 of 26

 
24 
60. 
Therefore, if Sachetti sold Atlantic Grill, LLC after he applied for the 
RRF grant, he knowingly and improperly avoided an obligation to transmit money 
to the government. 
VI. 
CAUSES OF ACTION 
COUNT I 
(AGAINST ALL DEFENDANTS) 
(Violation of False Claims Act, 31 U.S.C. § 3729(a)(1)(A)) 
61. 
Relator incorporates by reference paragraphs 1-60. 
62. 
In violation of 31 U.S.C. § 3729(a)(1)(A), Defendants knowingly 
presented or caused to be presented a false or fraudulent claim for payment to the 
United States government. 
COUNT II 
(AGAINST ALL DEFENDANTS) 
(Violation of False Claims Act, 31 U.S.C. § 3729(a)(1)(B)) 
63. 
Relator incorporates by reference paragraphs 1-60. 
64. 
In violation of 31 U.S.C. § 3729(a)(1)(B), Defendants knowingly made, 
used, or caused to be made or used, a false record or statement material to a false or 
fraudulent claim. 
COUNT III 
(AGAINST ALL DEFENDANTS) 
(Violation of False Claims Act, 31 U.S.C. § 3729(a)(1)(G)) 
65. 
Relator incorporates by reference paragraphs 1-60. 
66. 
In violation of 31 U.S.C. § 3729(a)(1)(G), Defendants knowingly made, 
used, or caused to be made or used, a false record or statement material to an 
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 24 of 26

25
obligation to pay or transmit money or property to the government, or knowingly 
concealed or knowingly and improperly avoided or decreased an obligation to pay 
or transmit money to the government.
VII.
PRAYER FOR RELIEF
WHEREFORE, Relator respectfully requests that judgment be entered in
favor of Relator and the United States and against Defendants as follows:
A.
Treble the United States’ damages in an amount to be determined at
trial and such civil penalties as are required by law, under 31 U.S.C. §
3729(a);
B.
An award of costs and fees, under 31 U.S.C. §§ 3729(a)(3) & 3730(d);
and
C.
Such further relief as is proper.
VIII. JURY DEMAND
Plaintiff demands a trial by jury on all claims so triable in this action.
Dated: October 15, 2024
By:
David M. Cohen
Ga. Bar No. 173503
COMPLEX LAW GROUP, LLC
40 Powder Springs Street
Marietta, GA 30064
Tel: (770) 200-3100
Fax: (770) 200-3101
Email: dcohen@complexlaw.com
Additional counsel listed on following page
V'DYLG0&RKHQ
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 25 of 26

26
Noah Rich (pro hac vice to be filed)
nrich@baronbudd.com
Andrew M. Miller (pro hac vice to be filed)
amiller@baronbudd.com
BARON & BUDD, P.C.
The Watergate
2600 Virginia Ave. NW, Ste. 612
Washington, DC 20037
Telephone: (202) 333-4562
Facsimile: (202) 337-1039
Attorneys for Plaintiff/Relator
Case 1:24-cv-04685-TWT     Document 1     Filed 10/15/24     Page 26 of 26

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