Golden Entertainment PA v. SBA — Defendants' Cross-Motion for Summary Judgment and Opposition

Document type: Motion
Date: 2021-04-20
Case: STRICT COURT FOR THE DISTRICT OF COLUMBIA GOLDEN ENTERTAINMENT PA, INC., Plaintiff, v. SMALL BUSINESS ADMINISTRATION et al., Defendants.
Case number: 22-1731

Summary

The defendants' memorandum of points and authorities in support of their cross-motion for summary judgment and in opposition to the plaintiff's motion, in Golden Entertainment PA, Inc. v. Small Business Administration et al., Civil Action No. 22-1731 (JDB), U.S. District Court for the District of Columbia, dated September 25, 2023. It describes the Shuttered Venue Operators Grant Program, the history of a movie theater in DuBois, Pennsylvania, and Golden PA's April 26, 2021 application for $623,443.42, later met by a Notice of Award of $140,285.57. SBA argues it has no ministerial, non-discretionary duty to disburse the award, did not err in calculating the grant, and that Golden PA is not entitled to a supplemental grant. It argues that vacatur and remand, not an injunction, would remedy any error. Assistant United States Attorney Bradley G. Silverman signs it.

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UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

GOLDEN ENTERTAINMENT PA, INC.,

Plaintiff,

v. Civil Action No. 22-1731 (JDB)

SMALL BUSINESS ADMINISTRATION
et al.,

Defendants.

DEFENDANTS’ MEMORANDUM OF POINTS AND AUTHORITIES
IN SUPPORT OF CROSS-MOTION FOR SUMMARY JUDGMENT AND
OPPOSITION TO PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
TABLE OF CONTENTS

BACKGROUND ............................................................................................................................ 1

I. The Shuttered Venue Operators Grant Program ................................................................. 1

II. The DuBois, Pennsylvania Movie Theater ......................................................................... 1

III. Golden’s Grant Application and Procedural History .......................................................... 3

LEGAL STANDARD..................................................................................................................... 4

ARGUMENT .................................................................................................................................. 5

I. SBA Has No Ministerial, Non-Discretionary Duty to Disburse the Amount Specified
in the Notice of Award, and Golden Has No Clear and Indisputable Right to the Funds .. 5

II. SBA Did Not Err in Calculating the Amount of Golden’s Grant ....................................... 8

III. Golden is Not Entitled to a Supplemental Grant .............................................................. 11

IV. Vacatur and Remand Would Be the Proper Remedy for Any Error, Not an Injunction .. 12

CONCLUSION ............................................................................................................................. 15

ii
Pursuant to Federal Rule of Civil Procedure 56, Defendants Small Business Administration

(“SBA”) and Administrator Isabella Casillas Guzman, by and through the undersigned counsel,

respectfully file this combined memorandum of points and authorities in support of their cross-

motion for summary judgment and in opposition to Plaintiff Golden Entertainment PA, Inc.

(“Golden PA”)’s motion for summary judgment.

BACKGROUND

I. The Shuttered Venue Operators Grant Program

The COVID-19 public health emergency forced many, if not most, businesses in the in-

person entertainment industry to cease their operations for extended periods of time. See 166 Cong.

Rec. S7901 (Dec. 21, 2020) (Sen. Cornyn) (“Event venues were the first to close when COVID-

19 hit, and they are likely to be the last to open once it is gone.”). To “help [these businesses] stay

afloat” until they could resume their normal operations, id., Congress established the Shuttered

Venue Operators Grant Program (“the Program”). See Economic Aid to Hard-Hit Small Business,

Nonprofits, and Venues Act, § 324, 134 Stat. 1182, 2022 (2020) (Div. N, Tit. III, Consolidated

Appropriations Act, 2021, Pub. L. No. 116-260, codified at 15 U.S.C. § 9009a). Under this relief

Program, an eligible entity could apply for grants of up to $10 million upon certifying “that the

uncertainty of current economic conditions ma[de] necessary the grant to support [its] ongoing

operations.” 15 U.S.C. § 9009a(b)(1)(B), (c)(1)(A)(ii), (c)(3).

II. The DuBois, Pennsylvania Movie Theater

The DuBois Twin Cinema, in DuBois, Pennsylvania, opened its doors to the movie-going

public on April 6, 1977. See Dave Bonan, Golden Ticket Cinemas Dubois 5, Cinema Treasures,

https://cinematreasures.org/theaters/18163 (last visited Sept. 25, 2023). One of the first movies the

new theater screened was The Deep (Columbia Pictures 1977), about two treasure-hunting divers

who confront criminals after discovering secret cargo in a World War II-era shipwreck. See Gene
M. Aravich, Opera Houses & Theaters in DuBois, DuBois Area Hist. Soc’y, Inc., http://duboishs

.com/index.php/dubois-theaters/ (last visited Sept. 25, 2023); The Deep, Internet Movie Database,

https://www.imdb.com/title/tt0075925/ (last visited Sept. 25, 2023). Over the decades, the theater

has expanded, taking over several connecting mall stores. See Aravich, supra. The theater also has

gone through a number of changes in its operation. See Bonan, supra. In December 1993, Carmike

Cinemas acquired the theater and renamed it Carmike Cinema V. See id. Then, in March 2017,

American Multi-Cinema, Inc.—aka, AMC Theaters—acquired the theater. See id.

Golden Entertainment MN, Inc. (“Golden MN”) took over the theater from AMC Theaters

in 2019. Ex. A, Bloemeke Decl. ¶ 3. After a “temporary” 19-day pause, the theater reopened to the

public in October 2019, with “only some slight cosmetic changes.” Elaine Haskins, Golden Ticket

Cinemas to Bring Luxury Movie Experience to DuBois, Courier Expr. (Sept. 18, 2019), https://

www.thecourierexpress.com/news/golden-ticket-cinemas-to-bring-luxury-movie-experience-to-

dubois/article_e4ccd113-c7da-5e5b-9691-25f7721bb434.html; see also Bloemeke Decl. ¶¶ 3-4.

Although Golden MN had plans to renovate the theater eventually, it retained many aspects of the

theater’s familiar character. It pledged, for example, that “[t]he existing and well loved popcorn

bucket will continue as Golden Ticket Cinemas will fill guests’ previously purchased AMC 2019

buckets for only $4.” Haskins, supra. In addition, “the former theater’s longtime general manager”

was “officially the general manager of the local theater under the new ownership.” Id. As a local

journalist informed her readers, “the theater will look the same right now.” Allison Gens, Movie

Theater to Reopen in DuBois With New Owners, WTAJ (Oct. 3, 2019), https://www.wtaj.com

/news/local-news/movie-theater-to-reopen-in-dubois-with-new-owners/. Golden MN operated the

theater through April 20, 2021, when it transferred the theater’s ownership to Golden PA, a new

entity incorporated earlier that same day. Bloemeke Decl. ¶¶ 6-7.

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III. Golden PA’s Grant Application and Procedural History

On April 26, 2021, Golden PA applied for a Program grant in the amount of $623,443.42.

Am. Compl. ¶ 21, ECF No. 17. On August 27, 2021, SBA denied Golden PA’s application. Id. ¶

23. In September 2021, Golden PA submitted an administrative appeal, which SBA denied on

November 19, 2021. Id. ¶¶ 24, 26.1 Golden PA filed this action on June 16, 2022, challenging the

denial of its grant application. See generally Compl., ECF No. 1. On December 7, 2022, SBA

vacated its denial of Golden PA’s application and issued a Notice of Award for a grant of

$140,285.57. Am. Compl. ¶ 28.

On December 22, 2022, Congress rescinded all remaining unobligated Program funds. See

Fairness for 9/11 Families Act, § 101(d)(2), 136 Stat. 4459, 6110 (2022) (Div. MM, Consolidated

Appropriations Act, 2023, Pub. L. No. 117-328); Richards Decl. ¶ 10, ECF No. 22-1. On February

16, 2023, Golden PA amended its complaint to challenge the SBA’s “failure to disburse funds” in

the awarded amount of $140,285.57 and “denial of the full amount of [its] SVOG award request”—

i.e., the additional $483,157.85 Golden PA sought but was not awarded—as arbitrary and

capricious, contrary to law, and unsupported by substantial evidence. Am. Compl. ¶¶ 43-51.2

Golden PA framed its claims as in the nature of mandamus. See id.

1
SBA initially denied Golden PA’s grant application, and that of Golden Entertainment SD,
Inc. (“Golden SD”), because it had already counted their 2019 revenues in calculating grants for
three affiliated corporate entities—Golden MN, Golden Entertainment NE, Inc. (“Golden NE”),
and Golden Ticket Cinemas, Inc. (“Golden Ticket”). See Shuttered Venue Operators Grantees,
SBA, https://data.sba.gov/dataset/svog (last visited Sept. 25, 2023). During a reconsideration
process, SBA recalculated those three entities’ grant awards in a manner that excluded Golden PA
and Golden SD’s 2019 revenues. Because SBA no longer was counting Golden PA and Golden
SD’s 2019 revenues in calculating the affiliated entities’ grant awards, for the first time it could
award Golden PA and Golden SD grants based on their 2019 revenues, and promptly did so.
2
In seeking to compel funding of the $140,285.57 Notice, Golden raises both a claim under
the Administrative Procedure Act (“APA”), 5 U.S.C. § 706, and a mandamus claim under 28
U.S.C. § 1361. Am. Compl. ¶¶ 38-51. Defendants address these claims together, as they are

3
On April 10, 2023, Defendants moved to stay this case pending a decision in Concert

Investor, LLC v. SBA, No. 22-5253 (D.C. Cir.), which presented the issue of whether Congress’s

rescission of funds rendered moot an action challenging a grant application’s denial. See Defs.’

Mot. Stay, ECF No. 28. Golden PA did not oppose a stay. See Pl.’s Resp., ECF No. 29. On May

10, 2023, this Court stayed the case pending a decision in Concert Investor. Min. Order (May 10,

2023). After SBA recovered certain grant funds it previously had disbursed to other entities,

Defendants withdrew their argument that the case is moot, Notice, ECF No. 32, and this Court

lifted the stay, Min. Order (Aug. 11, 2023).

LEGAL STANDARD

Summary judgment is merited “if the movant shows that there is no genuine dispute as to

any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a).

In an action under the Administrative Procedure Act (“APA”), 5 U.S.C. § 706, a court “review[s]

the administrative record to determine whether the agency’s decision was arbitrary and capricious,

and whether its findings were based on substantial evidence.” New LifeCare Hosps. of N.C., LLC

v. Becerra, 7 F.4th 1215, 1222 (D.C. Cir. 2021). “The scope of review under the ‘arbitrary and

capricious’ standard is narrow and a court is not to substitute its judgment for that of the agency.”

Motor Vehicle Mfrs. Ass’n of U.S., Inc. v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983).

An agency clears this hurdle so long as it “examine[s] the relevant data and articulate a satisfactory

explanation for its action including a rational connection between the facts found and the choice

made.” Id. (quotation marks omitted). The substantial evidence standard, meanwhile, “requires

functionally identical. See Kangarloo v. Pompeo, Civ. A. No. 20-0354 (CJN), 2020 WL 4569341,
at *7 (D.D.C. Aug. 7, 2020) (“Because Plaintiffs’ APA claim fails, mandamus is not available.”).

4
more than a scintilla, but can be satisfied by something less than a preponderance of the evidence.”

Epsilon Elecs., Inc. v. Dep’t of Treasury, 857 F.3d 913, 925 (D.C. Cir. 2017) (cleaned up).

ARGUMENT

Golden PA is not entitled to the amount specified in the Notice of Award, because SBA

has no ministerial, non-discretionary duty to disburse it such funds. SBA properly calculated the

amount of Golden PA’s award based on the information that Golden PA submitted. While Golden

PA argues that SBA should have calculated its award using a formula that applies to entities that

began operations after January 1, 2019, Golden PA is deemed to have been in operation on that

date as Golden MN stepped into the shoes of AMC Theaters, which was operating the theater as

of that date. Golden PA’s demand for a supplemental grant, meanwhile, is borderline frivolous, as

Golden PA did not apply for any such grant, does not even attempt to show that it is eligible for

such a grant, cannot be entitled to such a grant, and errs in calculating the amount that it would

receive. For all these reasons, this Court should grant Defendants’ cross-motion for summary

judgment and deny Golden PA’s motion for summary judgment. And should this Court conclude

that SBA erred, it should vacate the Notice of Award and remand the matter to SBA to determine

in the first instance how best to rectify the inconsistency that such a ruling would inject into SBA’s

determination of Golden PA’s eligibility for a grant—specifically, to decide whether its

determination that Golden PA stepped into Golden MN’s shoes can stand in light of a ruling that

Golden MN did not step into AMC Theaters’ shoes.

I. SBA Has No Ministerial, Non-Discretionary Duty to Disburse the Amount Specified
in the Notice of Award, and Golden PA Has No Clear, Indisputable Right to the Funds

The APA empowers a court to “compel agency action unlawfully withheld or unreasonably

delayed.” 5 U.S.C. § 701(1). “Section 706(1) permits judicial review of agency inaction, but only

within strict limits. Courts can compel an agency to take a discrete agency action that it is required

5
to take.” Anglers Conservation Network v. Pritzker, 809 F.3d 664, 670 (D.C. Cir. 2016) (cleaned

up). Relief under Section 706(1) thus is available “only if a federal agency has a ministerial or

non-discretionary duty amounting to a specific, unequivocal command.” Id. (quotation marks

omitted). “This standard reflects the common law writ of mandamus, which the APA carried

forward.” Id. (quotation marks omitted); see also Vietnam Veterans of Am. v. Shineski, 599 F.3d

654, 659 n.6 (D.C. Cir. 2010) (“the standards for obtaining relief” via writ of mandamus and APA

are “essentially the same”). “To show entitlement to mandamus,” a plaintiff must establish, among

other things, “a clear and indisputable right to relief” and “that the government agency or official

is violating a clear duty to act.” Am. Hosp. Ass’n v. Burwell, 812 F.3d 183, 189 (D.C. Cir. 2016).

“[I]f there is no clear duty to act,” courts “cannot mandate that an agency take any particular steps.”

Zandieh v. Pompeo, Civ. A. No. 20-0919 (JEB), 2020 WL 4346915, at *7 (D.D.C. July 29, 2020).

SBA has no ministerial, non-discretionary duty to disburse Golden PA the amount

specified in the Notice of Award, and Golden PA has no clear and indisputable right to such funds.

While Golden PA argues that the Notice of Award imposes such a duty, nothing in the Notice of

Award’s language purports to impose any sort of duty on SBA, much less one that is unequivocal

and ministerial. Cf. D&N Bank v. United States, 331 F.3d 1374, 1378-79 (Fed. Cir. 2003)

(“obligations” on agency do not arise from “[a]n agency’s performance of its regulatory or

sovereign functions”). To the contrary, the Notice of Award itself explains that its purpose is far

more modest—merely “to notify grant recipients of award reporting and record keeping

requirements.” Ex. B, Notice of Award. Notably, the box for an agency official’s signature was

never signed, undermining the idea that the Notice of Award imposes obligations on SBA. Id. (box

21); see also Elec. Privacy Info. Ctr. v. IRS, 910 F.3d 1232, 1245 (D.C. Cir. 2018) (“A non-binding

document cannot impose on an agency an enforceable duty to act.”); cf. Miller v. Holzmann, 471 F.

6
Supp. 2d 122, 124 (D.D.C. 2007) (“the parties contemplated that their ultimate agreement would

be . . . signed”). Nor does anything in 15 U.S.C. § 9009a, the statute that creates the Program,

suggest that a Notice of Award has the effect of imposing any sort of duty on SBA, or a clear right

to relief in an entity like Golden PA.

Unsurprisingly, the only court to address the issue concluded that a Notice of Award issued

under the Program imposes no obligation on SBA. In Imaginarium, LLC v. United States, 166 Fed.

Cl. 234, 244 (2023), the Court of Federal Claims held that a Notice of Award identical in relevant

respects to the one at issue here “does not establish mutual obligations owed by each party, nor

does it contain any other indications of intent to bind the United States.” Rather, the court reasoned,

a “Notice of Award is just that: an informational notice . . . akin to a regulatory approval document”

setting out “the Project Period, Budget Period, and Award Amount, among other information.” Id.

Although Imaginarium framed the issue as whether the Notice of Award evinced an “intent to bind

the United States to contract,” given that the plaintiff there had raised a breach of contract claim,

id., its analysis applies with equal force to the question of whether such a Notice of Award imposes

on SBA a ministerial, non-discretionary duty that can support relief in the nature of mandamus.3

Golden PA, for its part, does not attempt to explain why the Notice of Award ostensibly

creates a ministerial, non-discretionary duty to disburse funds. As best Defendants can discern,

Golden PA’s argument is that SBA must do what it said that it would do, but it cites no authority

and offers no reasoning to support this notion. Cf. Cogar v. Schuyler, 464 F.2d 747, 755 n.21 (D.C.

Cir. 1972) (“The courts cannot require an administrative agency to do that which is merely patently

3
Golden’s apparent litigating position that Golden MN does not stand in AMC Theaters’
shoes, for purposes of determining whether Golden was in operation on January 1, 2019, further
undermines the idea that SBA has a ministerial and non-discretionary duty to disburse funds. As
explained in further detail infra § IV, a ruling in Golden’s favor on that issue would undermine
SBA’s conclusion that Golden stands in Golden MN’s shoes, and thus, is eligible for a grant at all.

7
desirable.”); Li v. Kerry, 710 F.3d 995, 1004 (9th Cir. 2013) (“We have no authority to compel

agency action merely because the agency is not doing something we may think it should do.”).

And in any event, SBA has a sound reason to wait before disbursing Golden PA funds. Although

SBA has approximately $23 million available to fund Program grants, see Rule 28(j) Ltr. at 1, ECF

No. 25-1, numerous lawsuits arising under the Program remain pending in this District and others,

and Defendants’ total liabilities in these cases may well exceed the total balance of available

Program funds. Waiting for all such litigation to conclude before disbursing any additional

Program funds will allow SBA to apportion on an equitable basis limited grant funds between all

those entities ultimately determined, to be eligible for and entitled to a Program grant.

II. SBA Did Not Err in Calculating the Amount of Golden PA’s Grant

An entity is eligible for a Program grant only if it “was fully operational . . . on February

29, 2020.” 15 U.S.C. § 9009a(a)(1)(A)(i)(I). If a new owner acquires an otherwise-eligible entity,

“SBA will consider the new owner of an eligible entity to have stepped into the shoes of the prior

owner for purposes of qualifying for the [grant] program.” Shuttered Venue Operators Grants:

Frequently Asked Questions (“FAQs”) 14 (Oct. 20, 2021), https://www.sba.gov/sites/default/files/

2021-10/10-20-21%20SVOG%20FAQ%20FINAL_508_final.pdf (Question 84). “In the event of

such a transfer, SBA will permit the new owner to use the prior owner’s revenues as its own if the

transferred entity was operational on February 29, 2020, regardless of the date of the sale.” Id.

The formula for calculating an eligible entity’s Program grant depends on whether the

entity was in operation on January 1, 2019. 15 U.S.C. § 9009a(c)(1)(A)(i). An entity that was in

operation on that day receives a grant equal to 45% of its gross earned revenue during 2019. Id.

§ 9009a(c)(1)(A)(i)(I). An entity that began operations after that day, meanwhile, receives a grant

equal to six times its “average monthly gross earned revenue for each full month during which [it]

was in operation during 2019.” Id. § 9009a(c)(1)(A)(i)(II). Thus, for example, if an entity began

8
operations in mid-October 2019 and had $50,000 in gross earned revenue during November 2019

(its first full month of operation) and $150,000 in gross earned revenue during December 2019, it

would receive a grant of $600,000, six times the average of those two monthly amounts.

SBA properly calculated the amount of Golden PA’s grant based on the materials that

Golden PA submitted. While Golden PA was incorporated on April 20, 2021, Golden MN had

operated the theater before that since October 4, 2019, and AMC Theaters in turn had operated the

theater before that since March 2017. See Bloemeke Decl. ¶¶ 3-6; Am. Compl. ¶ 13; Bonan, supra.

In applying for a grant, Golden PA submitted its revenue information only for October, November,

and December 2019, without submitting any revenue information at all for January through

September 2019. See Am. Compl. ¶ 6.4 SBA thus properly awarded Golden PA a grant in the

amount of 45% of the only revenue it demonstrated it earned during 2019, as the statute required.

See 15 U.S.C. § 9009a(c)(1)(A)(i)(I).

SBA did not err in declining to calculate a grant as if Golden PA began to operate on

October 1, 2019. Just as Golden PA, which was not incorporated until April 20, 2021, stands in

Golden MN’s shoes, so too does Golden MN stand in the shoes of AMC Theaters, which operated

the theater as of January 1, 2019. See FAQs, supra, at 14; Bloemeke Decl. ¶ 3; Bonan, supra. In

both cases, the new operator carried on the theater’s essential business activity—screening

movies—with only a temporary period of public closure for renovations and other transitional

activities. In both cases, the new operator did not acquire the corporate entity that previously had

4
During the grant-making process, SBA repeatedly asked Golden for revenue information
for the earlier months in 2019. Golden claimed to lack this information, and purported to be unable
to obtain the information from AMC Theaters—even though Golden MN, Golden NE, and Golden
Ticket all had obtained and provided revenue information from their theaters’ prior operators. SBA
calculated Golden’s grant only after repeated efforts to obtain revenue information for all of 2019,
and Golden’s repeated assertions that it could not provide such information. Had Golden submitted
revenue information for the full year, SBA would have counted it in calculating Golden’s grant.

9
operated the theater, nor was there any transfer of title to the premises, which both the old and new

operators leased from a third-party landlord. Bloemeke Decl. ¶¶ 3, 6. Rather, the new operator

took over the theater’s operation, acquired the old operator’s fixtures and other business assets,

and retained the theater’s key staff and many familiar aspects of its character. See supra p. 2;

Haskins, supra (the theater had “only some slight cosmetic changes”); Gens, supra (“the theater

will look the same right now”).

There is no principled reason why Golden PA would stand Golden MN’s shoes—as it must

to be eligible for any grant in the first place—but Golden MN would not stand in AMC Theaters’

shoes. SBA certainly did not err in declining to adopt such an inconsistent approach. See Rapoport

v. SEC, 682 F.3d 98, 104 (D.C. Cir. 2012) (“agencies must apply their rules consistently”); Helton

v. NLRB, 656 F.2d 883, 891 (D.C. Cir. 1981) (“agencies have an obligation to be consistent in their

adjudicative decisions”). “Under the [APA] as elsewhere, what is good for the goose is good for

the gander.” Mozilla Corp. v. FCC, 940 F.3d 1, 62 (D.C. Cir. 2019). And even assuming, for the

sake of argument, that SBA reasonably could have concluded that Golden MN did not step into

AMC Theaters’ shoes, that does not mean that SBA was required to do so, or render its conclusion

to the contrary unreasonable. See Motor Vehicle Mfrs., 463 U.S. at 43 (“a court is not to substitute

its judgment for that of the agency”); Siegel v. SEC, 592 F.3d 147, 155 (D.C. Cir. 2010) (“The

reviewing court may not substitute its own judgment for the agency’s choice between two fairly

conflicting views, even if that court would justifiably have made a different choice had the matter

been before it de novo.” (quotation marks omitted)); see also Blue Ridge Env’t Def. League v.

Nuclear Regul. Comm’n, 716 F.3d 183, 13 (D.C. Cir. 2013) (“We are obligated to defer to the

wisdom of the agency, provided its decision is reasoned and rational.” (quotation marks omitted)).

10
Because Golden PA properly is deemed to have been in operation on January 1, 2019, SBA

correctly calculated its award as equal to 45% of the gross earned revenue during 2019 it showed.

The temporary pause in the theater’s operations that occurred when Golden MN acquired

it from AMC Theaters does not alter this analysis. Under SBA’s guidance, an entity’s new owner

steps into the old owner’s shoes, period—there is no requirement of continuous and uninterrupted

operations when a new owner acquires an entity. See FAQs, supra, at 14. Indeed, to superimpose

such a requirement onto the Program would undermine if not negate the very policy of deeming

an entity’s new owner to step into the prior owner’s shoes, given that businesses frequently cease

operations at least temporarily when new owners acquire them, for renovations and other purposes.

III. Golden PA is Not Entitled to a Supplemental Grant

Golden PA’s demand for a $311,721.71 supplemental grant is frivolous, as it did not apply

for such a grant. See Appalachian Power Co. v. EPA, 251 F.3d 1026, 1036 (D.C. Cir. 2001) (“An

agency cannot be faulted for failing to address such issues that were not raised by petitioners”);

Hensley v. United States, 292 F. Supp. 3d 399, 409 (D.D.C. 2018) (a “decision cannot be deemed

arbitrary and capricious for failing to address arguments that [were] never made”); Charlton v.

Donley, 846 F. Supp. 2d 76, 84 (D.D.C. 2012) (“an agency is not required to address arguments

that have not been asserted by the parties.”); see also Dep’t of Treasury v. Fed. Lab. Rels. Auth.,

707 F.2d 574, 582 n.25 (D.C. Cir. 1983) (“An administrative decision need not fail the test of

reasonableness solely because [agency] did not consider an argument later suggested”). Even now,

Golden PA does not even try to demonstrate eligibility for a supplemental grant. An entity was

eligible for such a grant “if, as of April 1, 2021, [its] revenues . . . for the most recent calendar

quarter [were] not more than 30 percent of [its] revenues . . . for the corresponding calendar quarter

during 2019 due to the COVID-19 pandemic.” 15 U.S.C. § 9009a(b)(3)(A). Golden PA does not

explain how, let alone prove that, it satisfies this condition. Litigation is not a wishing well, and

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Golden PA is not entitled to draw from the public fisc whatever sum, untethered to law or fact, it

tosses into its prayer for relief.

Even were Golden PA eligible for a supplemental grant, it cannot be entitled to one.

Congress entrusted to SBA’s judgment, not the judiciary’s, whether an entity should receive a

supplemental grant. Congress drafted the Program statute using the permissive term “may,”

providing that SBA “may make a supplemental grant,” not that it must do so. 15 U.S.C.

§ 9009a(b)(3)(A); see also Biden v. Texas, 142 S. Ct. 2528, 2541 (2022) (“‘may’ does not just

suggest discretion, it clearly connotes it” (cleaned up)); Perry Capital LLC v. Mnuchin, 864 F.3d

591, 607 (D.C. Cir. 2017) (“‘may’ is, of course, permissive rather than obligatory” (quotation

marks omitted)). Underscoring the discretionary nature of SBA’s authority to award supplemental

grants is the fact that a separate provision of the Program statute requires that any grant “shall be

in [a certain] amount.” 15 U.S.C. § 9009a(c)(1)(A), (2) (emphasis added). The Program statute’s

use of the mandatory term “shall” in specifying the formula that SBA must use to calculate the

amount of any grant that it awards stands in sharp contrast to its use of the permissive term “may”

to characterize SBA’s authority to issue—or not issue—such a grant at all. See Perry Capital,

864 F.3d at 607 (“When a statute uses both ‘may’ and ‘shall,’ the normal inference is that each is

used in its usual sense—the one act being permissive, the other mandatory.” (cleaned up)).

Lastly, even if Golden PA somehow were entitled to a supplemental award, it miscalculates

the amount it would receive. Golden PA uses the award calculation formula that applies to entities

that began operating after January 1, 2019, rather than the formula that applies to entities that

already were in operation on that day, which, as explained, applies here. See supra § II.

IV. Vacatur and Remand Would Be the Proper Remedy for Any Error, Not an Injunction

“[U]nder settled principles of administrative law, when a court reviewing agency action

determines that an agency made an error of law, the court’s inquiry is at an end: the case must be

12
remanded to the agency for further action consistent with the corrected legal standards.” N.C.

Fisheries Ass’n v. Gutierrez, 550 F.3d 16, 20 (D.C. Cir. 2008). “[R]emand to the agency for further

proceedings” thus is what a court “normally does when it identifies an agency error.” Id. Remand

is particularly appropriate “when an agency committing an error of law has discretion to determine

in the first instance how it should be rectified.” Global Van Lines, Inc. v. ICC, 804 F.2d 1293,

1305 n.95 (D.C. Cir. 1986). A “court err[s] by directing [an agency] how to [act] . . . rather than

just remanding after identifying the error.” Allina Health Servs. v. Sebelius, 746 F.3d 1102, 1111

(D.C. Cir. 2014). “Only in rare cases, when the reviewing court is convinced that remand would

serve no purpose, does the court direct the agency how to resolve a problem.” Id. at 1111 n.6.

Assuming that Defendants committed any error as to Golden PA’s grant application,

Golden PA fails to show that this is one of the “rare cases,” Allina, 746 F.3d at 1111, where an

injunction rather than vacatur and remand is appropriate. For one thing, as explained above,

Golden PA is not entitled to a grant at all, as the decision to award a grant falls within SBA’s

discretion. See supra § III. Moreover, also as explained above, Golden PA is eligible for a grant in

the first place only because SBA deemed it to stand in Golden MN’s shoes. See supra § II. Should

this Court conclude that SBA erred in deeming Golden MN to stand in AMC Theaters’ shoes, SBA

must reconsider its choice to deem Golden PA to stand in Golden MN’s shoes, too, given these

two determinations’ common analytic foundations, to ensure the consistency and integrity of its

programmatic decision-making and administration. See Rapoport, 682 F.3d at 104; Helton, 656

F.2d at 891. Whether or not SBA’s determination that Golden PA stands in Golden MN’s shoes—

and thus, SBA’s conclusion that Golden PA is eligible for any grant at all—could stand in light of

a ruling by this Court that Golden MN does not stand in AMC Theaters’ shoes is precisely the sort

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of question that SBA, not this Court, should “determine in the first instance.” Global Van Lines,

804 F.2d at 1305 n.95.5

Finally, Golden PA fails to satisfy the remaining factors for injunctive relief. It cannot show

irreparable harm because it was not entitled to a grant at all. See Afghan Yar Int’l Constr. Co. Ltd.

v. Dep’t of State, Civ. A. No. 21-1740 (CKK), 2021 WL 3472275, at *15 (D.D.C. Aug. 6, 2021)

(a party cannot rely on “unestablished” rights “to demonstrate irreparable harm”); Elec. Privacy

Info. Ctr. v. Presidential Advisory Comm’n on Election Integrity, 266 F. Supp. 3d 297, 319 (D.D.C.

2017) (“Plaintiff is not presently entitled to the [relief] that it seeks, and accordingly, Plaintiff

cannot show that it has suffered an irreparable [ ] injury”); Nat’l Conf. on Ministry to Armed Forces

v. James, 278 F. Supp. 2d 37, 52 (D.D.C. 2003) (no irreparable harm where “although plaintiff

quite possibly will suffer some harm by the denial of its application . . . this harm . . . is not based

on the denial of a right to which plaintiff was entitled”). And because Golden PA neither succeeds

on the merits nor will suffer irreparable harm without an injunction, the balance of equities and

public interest disfavor an injunction as well. See Zukerman v. Postal Serv., 64 F.4th 1354, 1364

(D.C. Cir. 2023) (“When the defendant is the government, factors (3) and (4) merge.”); FTC v.

Staples, Inc., 190 F. Supp. 3d 100, 116 (D.D.C. 2016) (“if [plaintiff] is unable to demonstrate a

likelihood of success on the merits, the equities alone cannot justify an injunction”).

* * *

5
Additionally, although beyond this litigation’s scope, SBA calculated the grants awarded
to Golden MN, Golden NE, and Golden Ticket based on its assumption that each of these entities
stands in the shoes of their prior theater operators. Should this Court conclude that Golden MN
does not stand in AMC Theaters’ shoes, SBA would need to recalculate each of those three entities’
grants and, if necessary, recoup any excess funds that it may have awarded these entities.

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CONCLUSION

This Court should grant Defendants summary judgment and deny Golden PA’s motion for

summary judgment.

Dated: September 25, 2023 Respectfully submitted,

MATTHEW M. GRAVES
D.C. Bar #481052
United States Attorney

BRIAN P. HUDAK
Chief, Civil Division

By: /s/ Bradley G. Silverman
BRADLEY G. SILVERMAN
D.C. Bar #1531664
Assistant United States Attorney
601 D Street NW
Washington, DC 20530
(202) 252-2575
bradley.silverman@usdoj.gov

Attorneys for the United States of America

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Golden Entertainment PA v. SBA — Defendants' Cross-Motion for Summary Judgment and Opposition

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