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Tuesday, February 17, 2009

Small Business Administration Moves Forward in Federal Lawsuit to Withhold Contracting Data

February 17, 2009

Petaluma, Calif. - Despite President Obama's promise of increased transparency in government, the Small Business Administration (SBA) is moving ahead with its appeal of a San Francisco District Court ruling directing it to release small business contracting data to the American Small Business League (ASBL). The 9th Circuit Court of Appeals will now hear the case. The SBA must file its appellate brief with the court by March 20.

Under the Freedom of Information Act (FOIA), the ASBL requested the names of all firms that had received federal small business contracts during fiscal years (FY) 2005 and 2006. During proceedings in United States District Court, Northern District of California, SBA attorneys attempted to convince United States District Judge Marilyn H. Patel that the agency did not possess any information on the actual recipients of federal small business contracts.

Patel rejected the SBA's excuse in her ruling in favor of the ASBL stating, "The court finds curious the SBA's argument that it does not 'control' the very information it needs to carry out its duties and functions."

The ASBL has won a series of FOIA cases against the SBA, NASA and the Pentagon, which have proven that the SBA dramatically inflated government small business contracting statistics. The information indicated that billions of dollars in contracts the SBA reported as going to small businesses had been diverted to Fortune 500 firms, their subsidiaries and thousands of other large businesses in United States and even Europe.

Since 2003, over a dozen federal investigations have found widespread fraud and abuse in virtually every small business program administered by the SBA. Several investigations found large businesses had received federal small business contracts fraudulently through "false certifications," "improper certifications" and "vendor deception."

In Report 5-14, the SBA's own Office of Inspector General found the SBA had reported contracts to several large businesses as small business awards, including Dutch conglomerate Buhrmann NV with more than 26,000 employees worldwide. (

SBA Press Office Director Mike Stamler has managed an extensive SBA media campaign to portray the billions of dollars in fraud and abuse in federal small business contracting programs as a "myth." ( With the help of several journalists, the ASBL has obtained evidence indicating Stamler has also made libelous and slanderous statements about the ASBL.

The ASBL is preparing to file another FOIA lawsuit against the SBA for refusing to comply with a FOIA request for e-mails Stamler sent members of the press in an attempt to slander ASBL President Lloyd Chapman.


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