Exhibit B (Byrne Declaration) — DV Diamond Club (E.D. Mich.)
Summary
Exhibit B in DV Diamond Club of Flint, LLC v. U.S. Small Business Administration (E.D. Mich.), Case No. 4:20-cv-10899, filed April 26, 2020 as ECF No. 26-2, marked as a redacted version. It is the declaration of Larry Byrne, an Illinois attorney representing plaintiff Stone Park Entertainment, LLC, executed April 24, 2020, authenticating email correspondence of April 22, 2020 attached as Exhibits 1 to 4. The declaration states that as of its date, to the declarant's knowledge, Stone Park has been unsuccessful in obtaining approval for a PPP loan from any lender. The emails state that according to the information the sender has Stone Park Entertainment is not eligible, that due to the nature of the business it is ineligible for an SBA loan, and that the bank will not submit the application to the SBA until it receives clarification on eligibility.
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“Exhibit B (Byrne Declaration) — DV Diamond Club (E.D. Mich.).”
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Case 4:20-cv-10899-MFL-DRG ECF No. 26-2 filed 04/26/20 PageID.816 Page 1 of 8
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
DV DIAMOND CLUB OF FLINT, LLC
d/b/a Little Darlings, et al.
Plaintiffs, Case No. 4:20-cv-10899
Hon. Matthew F. Leitman
v. Hon. David R. Grand
by referral
UNITED STATES SMALL BUSINESS
ADMINISTRATION, et al.
Defendants.
__________________________________________________________________
DECLARATION OF LARRY BYRNE, ESQ.
RE: AUTHENTICATION OF DOCUMENTS
I, Larry Byrne, hereby declare as follows:
1. I make this declaration upon my personal knowledge, unless
specifically stated to the contrary.
2. I am an attorney duly license to practice law in the State of Illinois. I
am an attorney with Penderson & Houpt, 161 North Clark Street, Suite 2700,
Chicago, Illinois.
3. I represent Stone Park Entertainment, LLC (“Stone Park”), plaintiff in
this above-captioned matter, with respect to the matters stated herein.
4. I am informed, as stated in the Verified First Amended Complaint
[ECF No. 11, ¶¶ 23], Stone Park does business as Scores at 4003 West Lake Street
EXHIBIT B
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in Stone Park, Illinois. I am informed that Stone Park is what is colloquially
referred to as a gentlemen’s club or “adult business” that presents female
performance dance entertainment which is fully clothed and, at times in pasties and
a t-strap. [Id.
- - at ¶217].
5. It is my understanding that whether a qualified Paycheck Protection
Program (“PPP”) lender is able to process loans for an adult business depends on
the individual bank interprets Small Business Association (“SBA”) guidance
and/or the regulations promulgated by the SBA. I understand that Stone Park
verily regards itself as eligible for a PPP loan.
6. My understanding is that, because this is the case, Stone Park has
sought out loans from multiple qualified PPP lenders. I have assisted Stone Park in
this process. As of the date of this declaration, to my knowledge, Stone Park has
been unsuccessful in obtaining approval for a PPP loan from any lender.
7. Attached hereto as Exhibit 1 is a true and accurate copy of email
correspondence between , Chief Operating Officer of
and me, which occurred on or about the date and time stated,
being 11:53 AM central time on April 22, 2020.
8. Attached hereto as Exhibit 2 is a true and accurate copy of email
correspondence between , Chief Operating Officer of
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and me, which occurred on or about the date and time stated,
being 1:06 PM central time on April 22, 2020.
9. Attached hereto as Exhibit 3 is a true and accurate copy of email
correspondence between , Chief Operating Officer of
and me, which occurred on or about the date and time stated,
being 1:30 PM central time on April 22, 2020.
10. Attached hereto as Exhibit 4 is a true and accurate copy of email
correspondence between , Chief Operating Officer of
and me, which occurred on or about the date and time stated,
being 1:54 PM central time on April 22, 2020.
I CERTIFY UNDER PENALTY OF PERJURY THAT THE FOREGOING
IS TRUE AND CORRECT.
Executed on: April 24, 2020
By: Larry Byrne
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Byrne, Larry
From:
Sent: Wednesday, April 22, 2020 11:53 AM
To: Byrne, Larry
Subject: Stone Park Entertainment
Mr Byrne:
Your inquiry regarding the PPP loan program was referred to me. We have reviewed the guidance and rules
provided to us by the SBA concerning the eligibility of the above business. According to the information we
have Stone Park Entertainment is not eligible. Accordingly the business is not in process or being considered
for submission. We believe that the second funding will begin within the next several days. If new guidance is
issued that changes the eligibility requirements we could reconsider. Given the speed in which the funds are
expected to be used and the pending qualified applicants we currently have I cannot be positive that we could be
able to get the request approved.
These are not our rules. We are merely following the guidelines provided to us by the SBA . I wish I had a
better interpretation of the rules for you
Chief Operating Officer
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Declaration of EXHIBIT 1
Byrne REDACTED VERSION OF DOCUMENTS TO BE SEALED Page 1
Case 4:20-cv-10899-MFL-DRG ECF No. 26-2 filed 04/26/20 PageID.820 Page 5 of 8
Byrne, Larry
From:
Sent: Wednesday, April 22, 2020 1:06 PM
To: Byrne, Larry
Cc:
Subject: Stone Park Entertainment
Yes. The guidance clearly states that this program is an add on to the existing 7A program which makes the
determination as to the eligibility of your client.
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Declaration of EXHIBIT 2
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Byrne, Larry
From:
Sent: Wed nesday, April 22, 2020 1:30 PM
To: Byrne, Larry
Cc:
Subject: RE: Stone Park's PPP Loan application
Barry
is in receipt of a PPP loan application for Stone Park Entertainment. Regrettably, due to
the nature of their business they' re ineligible for an SBA loan.
For more information on ineligible industries, including a detail list v isit SBA.gov.
Thank you,
This e-ma il, including any attachments, may contain information that is protected by law as privileged and confidential,
and is transm itted for the sole use of the intended recipient, If you are not the intended recipient, you are hereby
notified that any use, dissemination, copying or retention of this e-mail or the information contained herein is strictly
prohibited. If you have received this e-mail in error, please immediately notify the sender by telephone or reply e-mail,
and permanently delete this e-mail from your computer system. Thank you.
From: Byrne, Larry
Sent: Wednesday,
To
Subject: St one Park's PPP Loan application
THIS IS AN EXTERNAL EMAIL
Yo landa:
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Declaration of EXHIBIT3
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Case 4:20-cv-10899-MFL-DRG ECF No. 26-2 filed 04/26/20 PageID.822 Page 7 of 8
advised that you are working on the above loan application. It appears that another
round of PPP funding is imminent. Additionally, the funding has set asides for certain community
banks to assure middle‐market lenders can participate appropriately in this round of funding. Can
you please verify that the Stone Park PPP loan is in the queue based upon the date they applied and
that is not re‐ordering the line‐up or requiring a resubmission? Additionally, we
would like to know where they are in the queue if possible. Obviously we are concerned about the
time line and would like to be prepared and assured that all is in order if the funding is approved. We
also want to be certain that the bank anticipates participating in the next phase of the program.
My direct number is set out below if you have time to discuss the matter.
Pedersen
P'edetsetl&lloupt
Larry Byrne
Attorney at Law
161 North Clark Street, Suite 2700
Chicago, Illinois 60601
312-261-2155
lbyrne@pedersenhoupt.com
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Declaration of EXHIBIT 3
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Byrne, Larry
From:
Sent: Wednesday, April 22, 2020 1:54 PM
To: Byrne, Larry
Subject: Stone Park Entertainment
Larry: As you know the next funding has yet to be approved. We are not sure when that will occur. We can put
your client on our list to preserve its place. However we cannot submit to the SBA until the eligibility issue is
resolved. Once the program is up and running I do not think there will be funds available at month end. I will
refer this to outside counsel and will attempt to get a direct answer from the SBA. Since the bank would not
extend this loan without the guaranty from the SBA, we cannot take any steps that would jeopardize that
guaranty. To summarize: your client will go on the list. The bank will not submit the application to the SBA
once the process restarts until we receive clarification from the SBA as to the eligibility issue.
If you are able to identify another financial institution today that is willing to process that may be a prudent path
to follow.
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Declaration of EXHIBIT 4
Byrne REDACTED VERSION OF DOCUMENTS TO BE SEALED Page 1
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