Recent FAQ guidance from the Small Business Administration is causing great uncertainty for businesses that have received paycheck protection loans and are grappling with whether to return them, write litigators from McCarter & English.
On May 4, 2020, three California-based technology firms—Zumasys Inc. and two of its subsidiaries—filed suit in California federal court to block recent Small Business Administration guidance in the form of Frequently Asked Questions, which were issued after media outlets reported many publicly traded companies received millions in Paycheck Protection Program loans.
The FAQs are causing great uncertainty for businesses that have received paycheck protection loans as they grapple with whether to return them. See Zumasys, Inc. et al v. United States Small Business Administration et al.