Stipulation and Order — U.S. v. Alice + Olivia, LLC (S.D.N.Y.)

Summary

A stipulation and order of settlement and release between the United States and relator Verity Investigations, LLC in United States of America v. Alice + Olivia, LLC, 24 Civ. 5038 (AT), in the U.S. District Court for the Southern District of New York, filed February 5, 2026 as Document 11 and so ordered by Hon. Analisa Torres. It recites the relator's July 2, 2024 qui tam complaint and the government's January 24, 2026 complaint-in-intervention alleging that Alice + Olivia reported 293 employees on its Second-Draw PPP loan application and 271 on its forgiveness application when it employed greater than 300 persons. Under a separate settlement Alice + Olivia agreed to pay $3,200,000 plus interest at 3.77%. The United States will pay the relator ten percent (10%) of the payment received, $320,000 plus interest, and the relator releases further share claims.

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         Case 1:24-cv-05038-AT         Document 11       Filed 02/05/26      Page 1 of 6




UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK                                                         2/5/2026


UNITED STATES OF AMERICA,

                               Plaintiff-Intervenor,
                                                                24 Civ. 5038 (AT)

        -against-


ALICE + OLIVIA, LLC,

                               Defendant.



   STIPULATION AND ORDER OF SETTLEMENT AND RELEASE BETWEEN THE
                    UNITED STATES AND RELATOR

       WHEREAS, this Stipulation and Order of Settlement and Release (the “Relator

Stipulation”) is entered into between the United States of America (the “United States”), by its

attorney Jay Clayton, United States Attorney for the Southern District of New York, and relator

Verity Investigations, LLC (“Relator” and, together with the United States, the “Parties”), through

its counsel;

       WHEREAS, on or about July 2, 2024, Relator filed a complaint (the “Relator Complaint”)

under the qui tam provisions of the False Claims Act (“FCA”), 31 U.S.C. § 3729 et seq., against

Alice + Olivia, LLC (“Alice + Olivia”), alleging, inter alia, that Alice + Olivia violated the FCA

by submitting a Second-Draw PPP loan application with material misstatements regarding the

number of its employees (the “Relator Action”);

       WHEREAS, on or about January 24, 2026, the United States filed a complaint-in-

intervention (“Government Complaint”), alleging that Alice + Olivia violated the FCA by

knowingly, presenting and making, or causing to be presented and made, false claims and
           Case 1:24-cv-05038-AT        Document 11        Filed 02/05/26      Page 2 of 6




statements in connection with its submission of a Second-Draw PPP loan and forgiveness

applications. Specifically, the United States alleged that Alice + Olivia falsely reported that it had

293 employees at the time it applied for its Second-Draw PPP loan, when in fact Alice + Olivia

(together with its domestic and foreign affiliates) employed greater than 300 persons and was thus

ineligible for the Second-Draw PPP Loan. The United States also alleges that in connection with

its application for loan forgiveness, Alice + Olivia falsely reported that it had 271 employees at

the time it applied for its Second-Draw PPP loan, when in fact it employed greater than 300

persons;

       WHEREAS, on or about January 21, 2026, the United States, Alice + Olivia, and Relator

entered into a Stipulation of Settlement and Dismissal (the “Settlement Agreement”);

       WHEREAS, pursuant to Paragraph 3 of the Settlement Agreement, Alice + Olivia agreed

to pay the United States $3,200,000 plus interest which shall be compounded annually at a rate of

3.77% accruing from November 12, 2025 (the “Settlement Amount”) to resolve the claims of the

United States for the Covered Conduct;

       WHEREAS, Relator has asserted that, pursuant to 31 U.S.C. § 3730(d)(l), it is entitled to

receive a portion of the Settlement Amount (the “Relator Share Claim”); and

       WHEREAS, the Parties mutually desire to reach a full and final compromise of Relator

Share Claim pursuant to the terms set forth below.

       NOW, THEREFORE, in reliance on the representations contained herein and in

consideration of the mutual promises, covenants, and obligations in this Relator Stipulation, and

for good and valuable consideration, receipt of which is hereby acknowledged, the Parties agree

as follows:




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        Case 1:24-cv-05038-AT          Document 11        Filed 02/05/26      Page 3 of 6




       1.    Contingent upon receipt by the United States of full payment due to the United States

under Paragraph 3 of the Settlement Agreement, the United States will pay Relator, c/o Susman

Godfrey L.L.P, as attorneys for Relator (“Relator’s Counsel”), ten percent (10%) of the payment

of the Settlement Amount received from Alice + Olivia ($320,000 plus interest) in accordance

with written instructions provided by Relator’s Counsel within a reasonable time after the United

States’ receipt of the payment of the Settlement Amount. The obligation to make the payment to

Relator under this Paragraph is expressly conditioned on, and only arises with, the receipt by the

United States of the payment of the Settlement Amount from Alice + Olivia required by the

Settlement Agreement. In the event that Alice + Olivia fails to make the payment required by the

Settlement Agreement, the United States shall have no obligation to make any payment to Relator.

       2.    Relator, for itself and its successors, attorneys, agents and assigns, agrees that this

settlement is fair, adequate, and reasonable under all circumstances, and will not challenge the

Settlement Agreement, including but not limited to the Settlement Amount, pursuant to

31 U.S.C. § 3730(c)(2)(B) or other applicable law, and expressly waives the opportunity for a

hearing on any such objection, pursuant to 31 U.S.C. § 3730(c)(2)(B) or other applicable law.

       3.    In agreeing to accept payment of the Relator’s share set forth in Paragraph 1 above,

and upon payment thereof, Relator, for itself and its successors, attorneys, agents and assigns,

releases and is deemed to have released and forever discharged the United States and its agencies,

officers, employees, servants, and agents from any claim for a share of any proceeds of the

Settlement Agreement pursuant to 31 U.S.C. § 3730 or other applicable law, and from any and all

claims against the United States and its agencies, officers, employees, servants, and agents arising

from or relating to the Settlement Agreement or any claim in the Relator Action or the Government

Complaint.



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         Case 1:24-cv-05038-AT          Document 11        Filed 02/05/26     Page 4 of 6




       4.       This Relator Stipulation does not resolve or in any manner affect any claims the

United States has or may have against Relator arising under Title 26, U.S. Code (Internal Revenue

Code), or any claims that the Parties may have arising under this Relator Stipulation.

       5.      The United States and Relator agree that if the Settlement Agreement is held by a

court not to be “fair, adequate, and reasonable,” as required under 31 U.S.C. § 3730(c)(2)(B), this

Relator Stipulation is null and void.

       6.      This Relator Stipulation shall inure to the benefit of and be binding only on the

Parties, their successors, assigns and heirs.

       7.      This Relator Stipulation shall become final, binding, and effective only upon entry

by the Court.

       8.      This Relator Stipulation constitutes the entire agreement of the Parties with respect

to the subject matter of this Relator Stipulation and may not be changed, altered, or modified,

except by a written agreement signed by the Parties specifically referring to this Relator

Stipulation.

       9.      This Relator Stipulation is governed by the laws of the United States. The exclusive

jurisdiction and venue for any dispute relating to this Relator Stipulation is the United States

District Court for the Southern District of New York. For purposes of construing this Relator

Stipulation, this Relator Stipulation shall be deemed to have been drafted by all Parties to it and

shall not, therefore, be construed against any Party for that reason in any subsequent dispute.

       10.     This Relator Stipulation may be executed in counterparts, each of which shall

constitute an original and all of which shall constitute one and the same agreement.




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       Case 1:24-cv-05038-AT   Document 11    Filed 02/05/26     Page 5 of 6




Dated: January 24, 2026                   JAY CLAYTON
                                          United States Attorney
                                          Southern District of New York

                                    By:    /s/ Rebecca L. Salk
                                          REBECCA L. SALK
                                          Assistant United States Attorney
                                          86 Chambers Street, Third Floor
                                          New York, New York 10007
                                          Tel.: (212) 637-2614
                                          rebecca.salk@ujsdoj.gov
                                          Attorney for the United States


Dated: ______________, 2026               SUSMAN GODFREY L.L.P.

                                    By:
                                          Stephen Shackelford
                                          Steven M. Shepard
                                          Alicia Lai
                                          Susman Godfrey L.L.P
                                          One Manhattan West, 50th Floor
                                          New York, NY 10001
                                          sshackelford@susmangodfrey.com
                                          sshepard@susmangodfrey.com
                                          alai@susmangodfrey.com
                                          Attorneys for Relator




Dated: ______________, 2026               VERITY INVESTIGATIONS, LLC


                                          ____________________
                                          Gregory Lyman
                                          Relator




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New York, New York


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