SAN FRANCISCO--(BUSINESS WIRE)--On Friday, March 8, a federal judge rejected a bid by the Pentagon to squelch a lawsuit brought by the American Small Business League (“ASBL”) seeking to shed light on whether big defense contractors are giving a fair share of billions of dollars to small businesses.
The decision by U.S. District Court Judge William Alsup in San Francisco paves the way for a rare trial in a Freedom of Information Act (FOIA) case. The ruling came just before the start of National Sunshine Week, March 10, which raises public awareness on Freedom of Information cases and the importance of holding public officials and government agencies accountable.
Lloyd Chapman, president of the watchdog group ASBL that has won over 100 legal battles against the government, hailed the ruling. “The Pentagon is obviously trying to hide the fact that the Comprehensive Subcontracting Plan Test Program has created a massive loophole in federal contracting laws that has significantly reduced opportunities for small businesses,” Chapman said. “It’s unimaginable that the Pentagon will be 'testing' this blatant anti-small business loophole for over 38 years.”
In prior orders, Judge Alsup has said that ASBL is waging a “David and Goliath” struggle against the government and big businesses. The judge had noted that ASBL was trying to educate the public about defense contracts, and “here is the United States covering it up.”
ASBL’s lawsuit aims to reveal details of subcontracting plans, which will show whether big defense contractors like Sikorsky and General Electric are complying with requirements to set aside a share of their contracts for small and women-owned businesses. The government’s own studies have shown that during the “test program,” which is supposed to help small businesses, the percentage of federal dollars going to small businesses has steadily gone down. But the government is trying to hide its own “compliance reviews” that would show whether the big contractors are shortchanging small businesses.
Judge Alsup’s ruling rejected government arguments that ASBL’s lawsuit should be thrown out. The judge also ruled that some of the communications between government lawyers and Sikorsky’s lawyers in a prior case should be made public.
The government collaborated with Sikorsky’s lawyers in a prior case to keep information secret, before eventually realizing that a Sikorsky witness was not credible and releasing some information to the public.
In the current case, the Trump administration is using taxpayer dollars to provide free legal help to the big defense contractors. The Trump administration has also sided with big business in a case now pending before the U.S. Supreme Court in which big business is trying to weaken the Freedom of Information Act.
Karl Olson, a San Francisco lawyer who is representing ASBL in its lawsuit, praised Judge Alsup’s ruling as fair and said, “We welcome the opportunity to go to trial and question the defense contractor executives about whether they are complying with small business subcontracting goals.”
The case is American Small Business League v. Department of Defense, No. C-18-01979-WHA.