SBA, 2024 WL 5247837 (N.D. Ill., Dec. 30, 2024). That decision does involve

Summary

Petitioner Concessions HH, JV's Response to Respondent's Notice of Supplemental Authority, filed February 7, 2025 as Document 21 in Concessions HH, JV v. The United States Small Business Administration, Civil Action File No. 1:24-CV-1870-WMR, U.S. District Court, Northern District of Georgia, Atlanta Division. The response addresses the SBA's notice citing Forest View Rehabilitation and Nursing Center, LLC v. SBA, 2024 WL 5247837 (N.D. Ill., Dec. 30, 2024). Petitioner states that the decision involves a challenge to the Corporate Group Maximum Rule brought by a company not in the hospitality industry, that it did not invoke the CARES Act's waiver-of-affiliation provision, and that it supports Petitioner's position. The response carries an /s/ signature for Kian J. Hudson, Counsel for Petitioner.

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IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION

CONCESSIONS HH, JV,
Petitioner,
v.
THE UNITED STATES SMALL
BUSINESS ADMINISTRATION,

Respondent.

Civil Action File No.
1:24-CV-1870-WMR
PETITIONER CONCESSIONS HH, JV’S RESPONSE TO
RESPONDENT’S NOTICE OF SUPPLEMENTAL AUTHORITY
Petitioner Concessions HH, JV (CHH), by and through counsel,
respectfully files this Response to the Notice of Supplemental Authority
(ECF 20) filed by Respondent Small Business Administration (SBA). The
SBA’s notice cites Forest View Rehabilitation and Nursing Center, LLC v.
SBA, 2024 WL 5247837 (N.D. Ill., Dec. 30, 2024). That decision does involve
a challenge to the Corporate Group Maximum Rule (CGR), but that
challenge—brought by a company not in the hospitality industry—did not
invoke the CARES Act’s waiver-of-affiliation provision. Forest View thus
provides no support for the SBA’s arguments here. On the contrary, the
decision supports CHH’s position that the waiver-of-affiliation provision
expanded eligibility and specifically limited the SBA’s regulatory authority.
Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 1 of 6

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Forest View addressed a nursing home’s argument that 15 U.S.C.
§ 636(a)(36)(D)(i)—which provides that “any business concern … shall be
eligible to receive a covered loan if the business concern … employs not more
than … 500 employees”—meant that PPP loans must “be available to any
business concern without limitations.” 2024 WL 5247837 at *7 (emphasis in
original). Congress, the nursing home contended, thereby “barred the SBA
from imposing additional PPP eligibility requirements,” such as the CGR.
Id. at *6. The Court concluded that while “[t]his textual argument is
appealing at first glance,” it was inconsistent with “the greater statutory
scheme.” Id. at *7. It noted that “the CARES Act expanded eligibility
rules for PPP loans in several ways,” including by “waiv[ing] certain
affiliation rules.” Id. (emphasis added; citing 15 U.S.C. § 636(a)(36)(D)(iv),
the waiver-of-affiliation provision that CCH invokes here). Congress, the
Court observed, “would not have needed to specify that it was expanding
eligibility in these additional ways” if it “meant for PPP loans to be available
to any business concern without limitations (save for the size cap).” Id.
Unlike the nursing home challenger in Forest View, CHH does not
argue that the SBA lacks authority to issue regulations setting criteria for
PPP loan eligibility. Rather, CHH’s position is that, whatever other general
authority the SBA might have, the waiver-of-affiliation provision specifically
Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 2 of 6

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bars the SBA from deeming hospitality businesses ineligible for PPP loans
based on their affiliates.
Forest View supports CHH’s position, for it underscores both that the
waiver-of-affiliation provision “expanded eligibility rules” and that the CGR
limits eligibility. See 2024 WL 5247837 at *7 (noting that if “the SBA lacked
authority to implement other eligibility rules,” such as the CGR, “that
prohibition would be directly at odds with § 636(a)(36)(B)[],” and that
Congress would not have “stripped the SBA’s authority to implement other
eligibility requirements without explicitly saying so”) (emphasis added).
Further, far from supporting the SBA’s contention that the Economic
Aid Act (EAA) silently ratified the CGR, see ECF 20 at 2, Forest View
expressly rejects the argument that the EAA “ratif[ies] the SBA’s authority
to impose a corporate group limit.” 2024 WL 5247837 at *9 n.2. The Court
noted that “the congressional ratification doctrine only applies where ‘the
supposed judicial consensus [was] so broad and unquestioned that we must
presume Congress knew of and endorsed it.’” Id. (quoting Jama v. Immigr.
& Customs Enf’t, 543 U.S. 335, 349 (2005)). And “there is no ‘unquestioned’
judicial consensus given the Sixth Circuit’s decision agreeing with Forest
View's interpretation in DV Diamond Club [of Flint, LLC v. SBA], 960 F.3d
at 746–47, which preceded the PPP's reauthorization by several months.” Id.
Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 3 of 6

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Respectfully submitted this 7th day of February, 2025.

/s/ Kian J. Hudson

Kian J. Hudson
(pro hac vice)
BARNES & THORNBURG LLP
11 South Meridian Street
Indianapolis, IN  46204
Tel. (317) 229-3111
Kian.Hudson@btlaw.com

Eric S. Fisher
Georgia Bar No. 250428
BARNES & THORNBURG LLP
3340 Peachtree Road N.E., Suite 2900
Atlanta, GA 30326-1092
Tel. (404) 264-4045
EFisher@btlaw.com

Counsel for Petitioner Concessions HH, JV

Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 4 of 6

CERTIFICATE OF COMPLIANCE
In accordance with Northern District of Georgia Local Rules 5.1(C) and
7.1(D), I hereby certify that this brief complies with the Local Rules’ type
limitation because it has been set in a 13-point, proportionately spaced typeface
(Century Schoolbook).

Dated: February 7, 2025

/s/ Kian J. Hudson
Counsel for Petitioner
Concessions HH, JV

Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 5 of 6

CERTIFICATE OF SERVICE
I hereby certify that I have this 7th day of February filed the within and
foregoing
PETITIONER
CONCESSIONS
HH,
JV’S
RESPONSE
TO
RESPONDENT’S NOTICE OF SUPPLEMENTAL AUTHORITY with the Clerk
of Court by using the CM/ECF System which will automatically send email
notification of filing to all counsel of record.
Dated: February 7, 2025

/s/ Kian J. Hudson
Counsel for Petitioner
Concessions HH, JV

Case 1:24-cv-01870-WMR     Document 21     Filed 02/07/25     Page 6 of 6

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