On May 5, 2025, the Department of Justice (U.S. Attorney’s Office for the Northern District of New York) announced that CoreLife Eatery — a popular chain that operates restaurants in several states — agreed to pay over $7.8 million to resolve allegations that it violated the federal False Claims Act (FCA) by falsely certifying its eligibility to receive federal grant funds under the pandemic-era Restaurant Revitalization Fund (RRF). The RRF was enacted in March 2021 “as a continuation of the federal government’s efforts to provide relief to American individuals and businesses suffering the economic and public health effects of the pandemic.”
Under RRF rules, any restaurant that — together with affiliated businesses — owned or operated more than 20 locations as of March 13, 2020, was not eligible for funding. As part of the settlement, CoreLife admitted that it and its affiliates owned and operated nearly 30 restaurant locations as of March 2020, and therefore that it was ineligible to receive RRF funds. Despite this, when submitting its application, CoreLife checked “no” to the question of whether it owned or operated more than 20 locations and also initialed a representation to that effect.
The settlement was the result of a whistleblower action filed under the qui tam provisions of the FCA. The whistleblower will receive over $1.1 million for bringing the case.
This settlement is yet another important reminder that federal funds almost always come with certain terms and conditions and, if you do not follow these rules, not only will you have to pay the money back, but you might also face significant liability under the FCA, as well as other consequences such as debarment, and even criminal penalties.
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The attorneys at Chilivis Grubman represent businesses and individuals in connection with government investigations and False Claims Act litigation, including cases brought under the FCA’s qui tam whistleblower provisions. If you need assistance with such a case, please contact us.