Appeals court denies lobbyists’ efforts to access small-business loan program

A federal appeals court on Tuesday rejected an effort by a group of lobbyists and political consultants to obtain access to the Paycheck Protection Program (PPP) and its emergency loans for small businesses hit by the coronavirus pandemic.

A three-judge panel on the D.C. Circuit Court of Appeals upheld a federal judge’s decision not to grant a request by the American Association of Political Consultants (AAPC) for a preliminary injunction against the Small Business Administration (SBA), which oversees the lending program.

In a three-page decision, the panel rejected the group’s argument that excluding lobbyists and political consultants from the loans violated the First Amendment.

“Because appellants’ have not demonstrated that they are likely to succeed on their constitutional claims, the district court’s denial of appellants’ motion for a temporary restraining order and preliminary injunction was appropriate,” the judges said in their order.

Alana Joyce, the AAPC’s executive director, said in an email that the group is “reviewing the opinion and considering our options.” The decision can be appealed.

Congress has appropriated a total of $670 billion for the PPP and made most small businesses eligible to receive loans from the program. SBA regulations restrict the agency from lending to groups engaged in lobbying or political work.

The AAPC argues that their industry has been severely damaged by the economic downturn caused by the pandemic and that denying political groups and lobbyists loans violates their constitutional rights.

“If Plaintiffs-Appellants are unable to obtain loans under the PPP, they will be forced to abstain or substantially limit the exercise of their constitutional right to petition government and to enable and assist others in exercising the fundamental rights to run for public office and advance ballot initiatives and referendums,” the AAPC said in a filing to the D.C. Circuit last month. “Not only is this a significant injury to Appellants, but it is an injury to society as a whole as speakers will be compelled to exit the marketplace of ideas.”

The decision on Tuesday can be appealed. The AAPC did not immediately respond when asked for comment.