Commercial Litigation Update

A recent analysis of data released by the United States Small Business Administration (“SBA”) suggests that the vast majority of Paycheck Protection Program (“PPP”) loans extended to small businesses during the COVID-19 pandemic have been forgiven. While positive, this news is cold comfort to PPP borrowers for whom forgiveness was denied, or, as we addressed previously, whose lenders required them to apply for forgiveness in amounts less than the full amount of their PPP loans. PPP borrowers can apply for forgiveness of their PPP loans any time up until the loan maturity date (2025 in many cases), and borrowers continue to receive denials of forgiveness for both first- and second-draw PPP loans. As a result, the PPP appeal process remains as important today as at its inception.

The Paycheck Protection Program (“PPP”) was critical in helping small businesses stay afloat amidst the COVID-19 pandemic and resultant government restrictions on all manner of commerce. Now, as more businesses have applied for PPP loan forgiveness, some will receive notice that the United States Small Business Administration (“SBA”) is denying forgiveness of those loans. Small businesses whose PPP loans are denied will receive a letter that looks like this.