D.C. Circuit Rules That The 8(a) Program Is Constitutional, But Its Reasoning Raises Questions

David Black and Joseph Hornyak are Partners in Holland & Knight's Tysons office

On September 9, 2016, the U.S. Court of Appeals for the District of Columbia Circuit (D.C. Circuit) issued a split decision holding that § 8(a) of the Small Business Act does not violate the Equal Protection Clause of the U.S. Constitution.  Rothe Development, Inc. v. Department of Defense, No. 15-5176.  Although the Court's decision comes as welcome news to participants in SBA's 8(a) Business Development program, the Court's rationale raises new questions.  In its defense of § 8(a) against constitutional attack, the Court adopted an interpretation of the statute that may expose SBA's regulatory presumption that members of certain groups are "socially disadvantaged" to legal uncertainty.  It also remains to be seen whether the U.S. Supreme Court takes an interest in this case after a 20-year hiatus from reviewing race-based preferences in public procurement.