The U.S. Court of Appeals for the Federal Circuit affirmed a lower court decision on Feb. 4, 2026, allowing over 300 restaurants and businesses to continue their lawsuit against the United States seeking unpaid grant applications from the Restaurant Revitalization Fund.
In *112 Genesee Street, LLC v. United States*, the Federal Circuit rejected the government's appeal of a U.S. Court of Federal Claims ruling that denied the government's motion to dismiss. The government had argued the case should be dismissed for lack of Tucker Act jurisdiction and failure to state a claim upon which relief may be granted.
Chief Judge Kimberly Moore, writing for a three-judge panel that included Circuit Judge Alan Chen and District Judge David Andrews, issued a brief opinion affirming the lower court's decision. The case now returns to the Court of Federal Claims for further proceedings on the merits.
The lawsuit stems from disputes over the Restaurant Revitalization Fund, a $28.6 billion pandemic relief program established under the American Rescue Plan Act of 2021. Congress tasked the Small Business Administration with administering the RRF program to provide grants to eligible restaurants, bars, and similar dining establishments that suffered economic losses during the COVID-19 pandemic.
The plaintiffs, represented by attorneys from Williams & Connolly LLP including Charles McCloud, Frank Bowman, and Edward Charles Reddington, are seeking unpaid grant applications from the fund. The case was originally filed in the Court of Federal Claims in 2023 before Judge Richard Hertling.
The Department of Justice defended the government's position, with attorneys Margaret Jantzen from the Commercial Litigation Branch leading the appeal. She was assisted by William James Grimaldi, Patricia McCarthy, and Yaakov Roth.
The Restaurant Revitalization Fund was designed to help restaurants and food service businesses recover from pandemic-related revenue losses. The program allowed eligible entities to receive grants equal to their pandemic-related revenue loss, up to $10 million per business. Priority was initially given to businesses owned by women, veterans, and socially and economically disadvantaged individuals.
However, the program faced significant challenges during implementation. Demand far exceeded available funding, with the SBA receiving more than 362,000 applications requesting over $75 billion in relief. The agency was only able to fund approximately 100,000 applications before the money ran out.
The Federal Circuit's decision represents an important procedural victory for the plaintiff restaurants and businesses. By affirming the Court of Federal Claims' jurisdiction over the case, the appeals court has cleared the way for the plaintiffs to pursue their claims on the merits.
The Tucker Act provides the Court of Federal Claims with jurisdiction over claims against the United States founded upon the Constitution, federal statutes, executive regulations, or contracts. The government's challenge to jurisdiction suggested it believed the plaintiffs' claims did not fall within the court's authority to hear monetary claims against the federal government.
The case highlights ongoing disputes over pandemic relief programs and their implementation. Many businesses that applied for RRF grants but did not receive funding have faced continued financial difficulties. Some have pursued legal action seeking compensation for what they argue was improper administration of the relief programs.
The Federal Circuit's brief opinion does not provide detailed reasoning for its decision to affirm, which is typical for straightforward jurisdictional rulings. The court's affirmance suggests the judges agreed with the lower court's analysis that the plaintiffs had stated valid claims within the Court of Federal Claims' jurisdiction.
For the plaintiff restaurants and businesses, the decision means they can now proceed to argue the substance of their claims before Judge Hertling in the Court of Federal Claims. They will need to prove that they were entitled to RRF grants and that the government's failure to pay constituted a breach of legal obligation.
The government retains the ability to defend on the merits, arguing that the SBA properly administered the program within its statutory constraints and that no legal obligation exists to pay the unfunded applications.
The case reflects broader tensions over pandemic relief distribution and accountability. With limited funding available, federal agencies were forced to make difficult decisions about which applicants to fund first, leading to disputes over fairness and legal obligations.
As the case returns to the lower court, it will provide a test of whether businesses that applied for but did not receive pandemic relief funding have viable legal claims against the government for compensation.