SBA argues court cannot lift ATI’s suspension

The Small Business Administration wants a federal judge to reject ATI Government Solutions’ bid to lift the company's year-long suspension from federal contracting, arguing that the company is asking for a type of relief the law does not allow for.

In its Nov. 10 court filing, SBA also attacks ATI’s claims that the business has been ruined by the suspension. SBA argues that the company has not offered any evidence of the damage to its business.

The legal battle between SBA and ATI began in October 2025, when the agency suspended the company from the 8(a) program and from Federal Acquisition Regulation-based contracting a day after conservative activist James O’Keefe released a video he claimed depicts an ATI employee describing the company as a pass-through for other contractors.

ATI says the video was heavily-edited and that the person O’Keefe portrayed as an ATI executive was a short-term, part-time data-entry employee.

SBA lifted the 8(a) suspension in June after an SBA administrative judge found the agency had made no effort to support the video’s claims. But SBA kept the broader FAR suspension in place and extended it for another six months on Oct. 21 at the request of federal prosecutors.

On Oct. 22, ATI filed a complaint in the U.S. District Court for the District of Columbia asking a judge declare the suspension illegal and to force SBA to lift the suspension.

On Oct. 30, ATI filed a motion for a temporary restraining order and a preliminary injunction that would lift the suspension while the case moved forward.

ATI has also objected to SBA’s request to file its response under seal and ex parte, meaning only the judge would see it. U.S. District Judge Ana Reyes was not going to allow SBA to do that at first but has since changed course, at least temporarily.

SBA has been allowed to file a sealed document, seen only by the judge, with information about the request from prosecutors to extend the suspension.

SBA also says the U.S. Attorney’s Office is ready to brief the judge privately on its investigation. ATI has until Nov. 19 to ask the judge to unseal the filings.

What is public is SBA’s Nov. 10 opposition to ATI’s request. It lays out the agency’s legal arguments, but much of the factual background is redacted.

SBA says ATI could have asked the court to set aside the suspension or pause it under the Administrative Procedure Act. ATI instead asked for an injunction, which the agency argues the Small Business Act bars.

ATI has alleged that the Justice Department requested the extension at SBA’s urging, to create a pretext for keeping the suspension in place. SBA counters that ATI is effectively asking the court to interfere with a criminal investigation, something courts almost never do outside of First Amendment cases.

SBA also argues in its opposition filing that ATI filed no declarations or affidavits supporting its claim that it has lost more than 90% of its monthly revenue and had to lay off nearly all of its 67 employees.

SBA also says ATI waited more than a year to sue and has not explained why.

The FAR caps suspensions at 18 months, which indicates ATI's ban is slated to end on April 21, 2027 unless further legal proceedings are filed by the Justice Department before then.