In a solid hit against pandemic profiteering, Docklight Brands LLC, which deals in hemp and has ties with state-licensed cannabis products, is coughing up close to a cool million bucks to settle a lawsuit accusing it of playing fast and loose with the rules of COVID-19 federal aid.
The settlement, announced Monday, requires the company to pay nearly double the amount it received from the government's Paycheck Protection Program (PPP) – a loan designed to help small businesses keep their workforce employed during the COVID-19 crisis. According to the Justice Department, Docklight's total payout will be $989,438 after the firm snagged a $494,719 loan that, they apparently shouldn't have.
"Those seeking vital assistance from SBA’s pandemic response programs must comply with the requirements," Special Agent in Charge Weston King of the SBA's Office of Inspector General's Western Region said in the press statement. "Today’s settlement sends a strong message of accountability," he added, marking the end of a case that highlights the consequences of cutting corners in times of widespread crisis, as per the Justice Department.
The allegations were put forward in a qui tam lawsuit, a type of legal action that allows a whistleblower to file claims on behalf of the government and get a slice of the settlement pie. The whistleblower outfit, Sidesolve LLC, blew the whistle on Docklight last September, claiming the company told a big fat fib when it certified its eligibility for the PPP loan. For their trouble, Sidesolve will pocket $148,416.70 – not a bad day's work for calling out corporate overreach. Assistant United States Attorney Matt Waldrop, with investigative assistance from SBA-OIG, carried the case across the finish line for the U.S. Attorney’s Office.
While Docklight Brands neither admitted nor denied the allegations, the settlement closes a chapter of what has been a nationwide scramble to grab a lifeline during an unprecedented economic shutdown. As the dust settles on numerous such cases, it's clear that there's no room for error – or alleged deception – when it comes to federal funds meant for keeping America's workforce afloat.
