SBA Issues Interim Guidance After Ultima Decision Finds 8(a) Program Violates Equal Protection

On July 19, 2023, in Ultima Services Corp. v. U.S. Department of Agriculture, the U.S. District Court for the Eastern District of Tennessee enjoined the U.S. Small Business Administration (SBA) from determining federal contractor eligibility for its 8(a) Business Development program according to a "rebuttable presumption" that individuals of certain racial groups are socially disadvantaged. Participation in the 8(a) program provides certain contractors access to preferential federal government procurement opportunities, including certain sole-source and set-aside contracts.

Ultima Decision Summary and SBA Response

In the decision, Judge Clifton L. Corker held that the SBA 8(a) program's exclusion of plaintiff small business contractor Ultima Services, whose owner is a white woman, from opportunities to receive federal contracts based on SBA's "use of the rebuttable presumption" violates the U.S. Constitution's Fifth Amendment guarantee of equal protection. The