U.S. Attorney's Office, Texas, Northern, "Machining Supplier Settles PPP Lawsuit for $1.5 Million" (April 16, 2025)

Summary

Press release of April 16, 2025 from the United States Attorney's Office for the Northern District of Texas, announcing that SW North America, Inc., a machining and automation supplier, agreed to pay $1,520,958.14 to resolve False Claims Act allegations that it applied for and received a Paycheck Protection Program loan for which it was not eligible. The company received a loan in the principal amount of $1,204,400 in 2021, later forgiven in full, but the lawsuit alleged that with its affiliates it exceeded the applicable employee-count size standards. The settlement resolves a qui tam suit, case number 3:24-CV-1123-N in the Northern District of Texas, whose relator, GNGH2 Inc., will receive $187,003.05. The civil claims settled are allegations only, with no determination of liability.

Summary drafted by a model from the document's text below and checked by script against that text before publication. It is a navigation aid, not a reading of what the document proves. Where AI is used

Full text

SW North America, Inc., a machining and automation supplier, agreed to pay $1,520,958.14 to resolve allegations that the company violated the False Claims Act by applying for and receiving a loan it was not eligible for in the Small Business Administration’s (SBA) Paycheck Protection Program (PPP), announced Acting United States Attorney for the Northern District of Texas Chad E. Meacham.

Congress created the PPP in March 2020, as part of the Coronavirus Aid, Relief and Economic Security (CARES) Act to provide emergency loans to small businesses suffering economic hardship due to the COVID-19 pandemic. Whether an applicant qualified for a PPP loan depended on various factors, including employee-count size standards for applicants.

SW North America applied for and received a PPP loan in the principal amount of $1,204,400 in 2021, which was later forgiven in full. It was alleged in the lawsuit, however, that SW North America with its affiliates exceeded the applicable size standards for the loan, and was ineligible for that reason.

“PPP loans were intended, first and foremost, to help eligible small businesses during the COVID-19 pandemic,” said Acting United States Attorney Chad E. Meacham. “This office will continue to aggressively pursue loan recipients who were not eligible to obtain taxpayer funds, whether due to their size or for any other reason.”

The settlement resolved a lawsuit filed under the qui tam or whistleblower provision of the False Claims Act, which permits private parties to file suit on behalf of the United States and share in a portion of the government’s recovery. The qui tam lawsuit is case number 3:24-CV-1123-N in the U.S. District Court for the Northern District of Texas, and the qui tam relator, GNGH2 Inc., will receive $187,003.05 in connection with the settlement.

The government was represented in the lawsuit by Assistant United States Attorney Andrea Hyatt, with assistance from Amber Perez of the SBA. The civil claims settled by the agreement are allegations only; there has been no determination of civil liability.

File and source

File

doj-usao-ndtx-press-release-machining-supplier-settles-ppp-lawsuit-15-million-2025-04-16.json

Size

3,093 bytes

SHA-256

0018c6f270e5492d15fca89150bb380b0fd093e4bafc0636bd6cee9900f81bae

Our copy

doj-usao-ndtx-press-release-machining-supplier-settles-ppp-lawsuit-15-million-2025-04-16.json

Original

www.justice.gov