UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF FLORIDA

PENSACOLA DIVISION

SPORT & WHEAT, CPA, PA,

Plaintiff,

v. Case No. 3:20cv5425-TKW-HTC

SERVISFIRST BANK, INC., et al.,

Defendants.

______________________________/

ORDER DISMISSING AMENDED COMPLAINT

The central issue of first impression in this case is whether Plaintiff and others 

like it are entitled to any portion of the fees paid by the federal government to lenders 

like Defendants who were tasked with handing out hundreds of billions of dollars of 

“loans” under the Paycheck Protection Program (PPP).1 The short answer is “no.”

This issue arises in the context of Defendants’ motions to dismiss Plaintiff’s

amended complaint under Fed. R. Civ. P. 12(b)(6). See Docs. 46, 49, 67, 69. The 

motions, responses (Docs. 56, 85), and reply (Doc. 65) were comprehensively (and 

ably) briefed, and no hearing is necessary to rule on the motions.

1

 This case was apparently the first of what is now at least 50 cases pending around the 

country raising the same issue. A motion to transfer these cases into a single MDL proceeding 

was denied by the Judicial Panel on Multidistrict Litigation last week. See In re Paycheck 

Protection Program (PPP) Agent Fees Litigation, MDL No. 2950 (J.P.M.L. Aug. 5, 2020).

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 1 of 13
2

When ruling on a Rule 12(b)(6) motion to dismiss, the Court accepts the 

allegations in the operative complaint (here, the amended complaint, Doc. 21) as 

true and construes them in the light most favorable to the plaintiff under the 

“plausibility” standard adopted by the Supreme Court. See Ascroft v. Iqbal, 556 U.S. 

662, 678 (2009); Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007); Crespo v. 

Coldwell Banker Mortg., 599 F. App’x 868, 874 (11th Cir. 2014). Applying this

standard, the Court finds for the reasons that follow that the motions to dismiss are 

due to be granted.

Factual and Procedural Background

Plaintiff is a small accounting firm that assisted its clients (the borrowers) in 

obtaining loans from Defendants under the PPP. Plaintiff alleges in the amended 

complaint that Defendants did not pay it the “agent fees” (totaling $4,526)2it was 

due under the PPP and its implementing regulation for helping the borrowers obtain 

the loans. Plaintiff does not allege that it or the borrowers had agreements with 

Defendants regarding payment of Plaintiff’s agent fees.

The amended complaint asserts four counts and seeks monetary damages and 

injunctive relief against Defendants (and other “John Doe” lenders) on a class-wide 

2

 Specifically, the amended complaint alleges that Plaintiff is entitled to $941.65 of the loan 

processing fee paid by the Small Business Administration (SBA) to Defendant ServisFirst, 

$1,633.03 of the fee paid to Defendant Synovus, $75.75 of the fee paid to Defendant The First, 

and $1,875.57 of the fee paid to Defendant Truist. See Doc. 21, at ¶¶ 91, 112, 126, 139.

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 2 of 13
3

basis. Count 1 (“unjust enrichment”) and Count 2 (“contract implied in law”) seek 

to recover the monetary benefit Plaintiff allegedly conferred on Defendants when it 

helped the borrowers obtain PPP loans through Defendants; Count 3 (“conversion”) 

alleges the Defendants unlawfully retained the portion of the loan processing fees 

that Plaintiff was entitled to under the PPP and its implementing regulation; and 

Count 4 (“declaratory relief”) seeks a declaration that Defendants violated federal 

law by not paying Plaintiff the portion of the loan processing fee it was entitled to 

under the PPP along with appropriate injunctive relief.

Counts 3 and 4 are premised on the assumption that the PPP and its 

implementing regulation require lenders to pay the agent’s fee irrespective of 

whether there is an agreement between the agent or borrower and the lender to do 

so. By contrast, Counts 1 and 2 are premised on equitable principles (rather than 

legal entitlement under the PPP and its implementing regulation) under state 

common law based on Plaintiff’s allegations that Defendants were aware of and 

benefitted from the work Plaintiff did on the borrowers’ PPP loan applications.

Analysis

The crux of this case is in Count 4, which seeks a declaration that Defendants 

are required to pay “agent fees” to Plaintiff for the work it performed on behalf of 

the borrowers who obtained PPP loans from Defendants. The claim is premised on 

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 3 of 13
4

the assumption that the CARES Act3and its implementing regulation require lenders 

to pay the borrowers’ agent fees. This assumption, however, finds no support in the 

plain language of the statute or the regulation.

Section 1102 of the CARES Act created the PPP as part of the Section 7(a) 

Loan Program administered by the SBA. The PPP was intended to help small 

businesses impacted by the COVID-19 pandemic by providing loans4that could be 

used to cover payroll and other costs. The loans were administered by the private 

sector (e.g., banks, credit unions, existing SBA Section 7(a) lenders), but they were 

fully funded and guaranteed by the federal government.

The CARES Act mandated that the SBA Administrator “shall reimburse a 

lender authorized to make a covered loan” and it established the fees that the lender 

will be paid for making the loans. See Pub. L. No. 116-136, §1102(a)(2) (to be 

codified at 15 U.S.C. §636(a)(36)(P)(i)). The Act further provided that “[a]n agent 

that assists an eligible recipient to prepare an application for a covered loan may not 

3

 Coronavirus Aid, Relief, and Economic Security Act, Pub. L. No. 116-136, 134 Stat. 281

(2020).

4

 The monies received under the PPP are “loans” in only the loosest sense of that word 

because the borrower is not required to make any payments for six months and the full amount of 

the principal borrowed and any accrued interest will be forgiven if the borrower uses the loan 

proceeds to cover payroll and other approved costs. See Pub. L. No. 116-136, §1102(a)(2) (to be 

codified at 15 U.S.C. §636(a)(36)(M)), §1106(b); see also Paycheck Protection Program 

Flexibility Act of 2020, Pub L. No. 116-142, §3, 134 Stat. 641, 641-43 (2020) (extending the 

deferral period and modifying the criteria for loan forgiveness).

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 4 of 13
5

collect a fee in excess of the limits established by the [SBA] Administrator.” Id. (to 

be codified at 15 U.S.C. §636(a)(36)(P)(ii)).

In April 2020, pursuant to the authority delegated by the statutory language 

quoted above, the SBA issued an interim final rule (IFR) to implement the PPP. See

Business Loan Program Temporary Changes; Paycheck Protection Program, 85 Fed. 

Reg. 20,811 (Apr. 15, 2020).

5

 The IFR provides in pertinent part:

Agent fees will be paid by the lender out of the fees the 

lender receives from SBA. Agents may not collect fees 

from the borrower or be paid out of the PPP loan proceeds. 

The total amount that an agent may collect from the lender 

for assistance in preparing an application for a PPP loan 

(including referral to the lender) may not exceed:

i. One (1) percent for loans of not more than 

$350,000;

ii. 0.50 percent for loans of more than $350,000 and 

less than $2 million; and

iii. 0.25 percent for loans of at least $2 million.

Id. at 20,816. The IFR also states that its provisions “temporarily supersede any 

conflicting Loan Program Requirement (as defined in 13 CFR 120.10).” Id. at 

20,812.

5

 The SBA has since adopted other regulations to implement the PPP, see

https://www.sba.gov/funding-programs/loans/coronavirus-relief-options/paycheck-protectionprogram#section-header-9 (list of regulations), but none of those regulations appear to have any 

bearing on the issues in this case.

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 5 of 13
6

The CARES Act does not require lenders to pay the agent’s fees absent an 

agreement to do so (or create a private right of action for payment6) because the 

statutory language does not even speak to who pays the agent’s fees; it merely 

provides that the agent cannot collect a fee from anyone in excess of the amount 

established by the SBA Administrator. Indeed, the different language used by 

Congress in mandating payment of lenders (“shall reimburse”) and limiting agent 

fees (“may not collect”) is indicative of an intent not to require lenders to pay agent 

fees. See In re Failla, 838 F.3d 1170, 1176-77 (11th Cir. 2016) (quoting Antonin 

Scalia & Bryan A. Garner, Reading Law 170 (2012)) (“The presumption of 

consistent usage instructs that ‘[a] word or phrase is presumed to bear the same 

meaning throughout a text’ and that ‘a material variation in terms suggest a variation 

in meaning.’”). Thus, if lenders have any legal obligation to pay agent fees absent 

an agreement to do so, that obligation must come from the IFR.

The IFR asks—and then answers—the question of “[w]ho pays the fee to an 

agent who assists a borrower” by stating that payment is to be made “by the lender 

6

 Defendants spend a significant amount of their briefing arguing that the CARES Act does 

not create an express or implied private right of action as required to bring a claim under the 

Declaratory Judgment Act (DJA). Although it is doubtful that such a private right of action exists, 

see Profiles, Inc. v. Bank of Am. Corp., 2020 WL 1849710, at *7 (D. Md. Apr. 13, 2020) (“The 

Court is not persuaded that the language of the CARES Act evidences the requisite congressional 

intent to create a private right of action.); see also United States v. Fid. Capital Corp., 920 F.2d 

827, 838 n.39 (11th Cir. 1991) (noting that “no private right of action exists for a violation of the

[Small Business] Act or the regulations”), the Court need not decide that issue because the claim 

asserted by Plaintiff under the DJA clearly fails on the merits.

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 6 of 13
7

out of the fees the lender receives from SBA” and not “from the borrower or . . . out 

of the PPP loan proceeds.” 85 Fed. Reg. 20,816. This language does not require

that lenders share their fees—nor does it (or could it7) create or provide a right of 

action for agents to collect fees from the lender; instead, the language simply 

explains that, if an agent is to be paid a fee, the fee must be paid by the lender from 

the fee it receives from the SBA. This, then, begs the question of whether an 

agreement between the lender and the agent is necessary for the lender to be required 

to pay the agent fees.

Defendants argue that the existing Section 7(a) regulations require such an 

agreement as a prerequisite to the lender’s payment of agent fees. Plaintiff conceded 

this point in the amended complaint, but it now argues that an agreement with the 

lender is not required under the PPP.8 The Court agrees with Defendants.

The PPP was added to and exists within the framework of Section 7(a) of the 

Small Business Act, see Pub. L. No. 116-136, §1102(a), and the IFR states that it 

only supersedes “conflicting” Section 7(a) program requirements, see 85 Fed. Reg. 

7

 See Alexander v. Sandoval, 532 U.S. 275, 291 (2001) (“Language in a regulation may 

invoke a private right of action that Congress through statutory text created, but it may not create 

a right that Congress has not.”).

8

 Compare Doc. 21, at ¶ 65 (“Harmonizing these provisions, a Borrower may agree to hire 

a PPP Agent, subject to the fee caps set by the SBA in its PPP Interim Final Rule; and to be paid 

under 13 CFR § 103.5(a), the PPP Agent must submit the arrangement in writing on SBA’s Form 

159.”) with Doc. 56, at 21 (“[Plaintiff] has reconsidered its position and now argues that Form 159 

and other SBA formalities are not required”).

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 7 of 13
8

20,812. Accordingly, it follows that all non-conflicting program requirements 

continue to apply.

The existing Section 7(a) program requirements provide that the fees charged 

by an agent must be “reasonable” and they establish presumptively reasonable 

amounts for the fees. See 13 C.F.R. §103.5(b). The applicant or agent must execute 

a “compensation agreement” and provide it to the SBA on a specific form. See 13 

C.F.R. §103.5(a); SBA Form 159 (rev. Apr. 9, 2018).

9

 The form must identify the 

portion of the agent fee to be paid by the borrower and the portion to be paid by the 

lender, see SBA Form 159, at 2 (providing separate boxes for these amounts), and 

the agent’s fees cannot be contingent upon the loan being approved, id. at 1 (“The 

SBA does not allow contingency fees (fees paid only if the loan is approved) . . . .”).

The Court sees no conflict in these requirements and the IFR, except that the 

cap on agent fees in the IFR are considerably lower than the presumptively 

reasonable amounts in 13 C.F.R. §103.5(b) and agent fees under the PPP are 

necessarily contingent because they can only be paid out of the fee received by the 

lender and the lender only receives the fee if the loan is funded. Specifically, Form 

159 does not conflict with the IFR because (1) there is nothing in the IFR that 

prohibits the SBA Administrator from requiring use of the form (or the disclosure of 

9

 The form is available online at https://www.sba.gov/document/sba-form-159-feedisclosure-compensation-agreement.

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 8 of 13
9

agent fees) and the form clearly states that it is to be used “whenever an Agent is 

paid by either the [borrower] or the SBA Lender in connection with the SBA loan 

application” (emphasis added),10 and (2) even though the IFR prohibits agents from 

collecting fees from borrowers, there are separate spaces on the form to indicate the 

portion of the fee paid by the borrower (which would have to be $0 under the IFR) 

and the portion of the fee paid by the lender (which could be whatever the lender 

and agent agreed up to the caps in the IFR). Accordingly, because these existing 

program requirements do not conflict with the IFR, they apply to agents who assist 

borrowers in obtaining loans under the PPP.

Here, it is undisputed that neither Plaintiff nor the borrowers executed Form 

159, nor did they have agreements with Defendants regarding payment for the work 

Plaintiff performed in assisting borrowers in obtaining PPP loans through 

Defendants. Accordingly, Defendants have no legal obligation under the CARES 

Act or the IFR to pay Plaintiff an “agent fee” for helping the borrowers get PPP loans 

from Defendants, and on that basis, Count 4 of the amended complaint is due to be 

dismissed.

10 On this point, the Court did not overlook Plaintiff’s argument that it need not sign Form 

159 because the form’s instructions state that the agent’s signature is only required when it is being 

paid by the borrower (“Each Agent paid by the Applicant to assist in connection with its application 

must also complete and sign the form.”) and the PPP prohibits the agent from collecting a fee from 

the borrower. However, the form clearly states that “[w]hen an Agent is paid by the SBA Lender, 

the SBA Lender must complete this form and the SBA Lender and Applicant must both sign the 

form.” Thus, before the lender can pay the agent’s fee under the PPP, Form 159 must be signed 

by at least the lender and the borrower.

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 9 of 13
10

The state law conversion claim in Count 3 is due to be dismissed for similar 

reasons. Under Florida law, “[t]he gist of a conversion [is] . . . the wrongful 

deprivation of a person of property to the possession of which he is entitled.” Star 

Fruit Co. v. Eagle Lake Growers, Inc., 33 So. 2d 858, 860 (Fla. 1948). Thus, to 

state a claim for conversion, “the plaintiff must have a present or immediate right of 

possession of the property in question.” United States v. Bailey, 419 F.3d 1208, 

1214 (11th Cir. 2005) (quoting Page v. Matthews, 386 So. 2d 815, 816 (Fla. 5th 

DCA 1980)). If the plaintiff has no right to the property in question, it has no 

conversion claim. Here, as explained above, Plaintiff had no legal right to any 

portion of the fee Defendants received from the SBA for making the loans to the 

borrowers assisted by Plaintiff. Accordingly, Count 3 is due to be dismissed.

The state law claims for unjust enrichment and contract implied in law in 

Counts 1 and 2 are duplicative11 and fare no better than the other counts. To state a 

claim for unjust enrichment and/or contract implied in law, Plaintiff must allege “(1) 

plaintiff conferred a benefit upon the defendant, who has knowledge of that benefit; 

(2) defendant accepts and retains the conferred benefit; and (3) under the 

11

 Under Florida law, the elements for a claim for “unjust enrichment” or “contract implied 

in law” are the same. See Commerce P’Ship 8098 Ltd. P’ship v. Equity Contr. Co., 695 So. 2d 

383, 386 (Fla. 4th DCA 1997) (explaining that Florida courts have synonymously used a number 

of different terms, including “unjust enrichment,” to describe the cause of action encompassed by 

a contract implied in law); see also Resnick v. AvMed, Inc., 693 F.3d 1317, 1325 n.2 (11th Cir. 

2012) (“To the extent Plaintiffs allege a contract implied in law, such contracts must be pled in the 

same way as unjust enrichment claims.”).

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 10 of 13
11

circumstances, it would be inequitable for the defendant to retain the benefit without 

paying for it.” Vibo Corp. v. US Flue-Cured Tobacco Growers, 762 F. App'x 703, 

705 (11th Cir. 2019) (quoting Fito v. Attorneys' Title Ins. Fund, Inc., 83 So. 3d 755, 

758 (Fla. 3d DCA 2011)). To satisfy the first element, “the plaintiff must directly

confer a benefit to the defendant.” Kopel v. Kopel, 229 So. 3d 812, 818 (Fla. 2017)

(citing Peoples Nat'l Bank of Commerce v. First Union Nat'l Bank of Fla. N.A., 667 

So. 2d 876, 879 (Fla. 3d DCA 1996)) (emphasis added); see also Virgilio v. Ryland 

Grp., Inc., 680 F.3d 1329, 1337 (11th Cir. 2012) (affirming dismissal of unjust 

enrichment claim under Florida law where benefit was indirect); Century Senior 

Servs. V. Consumer Health Ben. Ass’n Inc., 770 F. Supp. 2d 1261, 1267 (S.D. Fla. 

2011) (“A benefit that a defendant gains that does not come directly from the 

plaintiff does not give rise to a claim for unjust enrichment.”); Tilton v. Playboy 

Entm’t Grp., Inc., 2007 WL 80858, at *3 (M.D. Fla. Jan. 8, 2007) (explaining, the 

plaintiff’s conferral of an indirect benefit upon the defendant is insufficient to 

support an unjust enrichment claim); Am. Safety Ins. Serv., Inc. v. Griggs, 959 So. 

2d 322, 331-32 (Fla. 5th DCA 2007) (holding that conferral of a direct benefit is 

required).

Here, although Plaintiff’s work on the borrowers’ PPP loan applications 

directly benefitted the borrowers because it helped them get PPP loans, the benefit 

received by Defendants for making the loans to the borrowers (i.e., loan processing

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 11 of 13
12

fees from the SBA) was merely an incidental benefit of Plaintiff’s work for the 

borrowers.12 Thus, putting aside the question of whether each Defendant had the 

requisite knowledge of the benefit allegedly conferred on them by Plaintiff,13 the 

Court finds that Plaintiff’s indirect conferral of a benefit on Defendants is 

insufficient to satisfy the first element of a claim for unjust enrichment or contract 

implied in law against Defendants. Accordingly, Counts 1 and 2 are due to be 

dismissed.14

12

 The Court has not overlooked Plaintiff’s argument that the benefit it conferred on 

Defendants was the time that Defendants did not need to spend pulling together information to 

complete the borrowers’ loan applications. However, as the Court understands Plaintiff’s claims, 

it is not suing to recover the value of that work (nor could it because the IFR caps the fee the agent 

can receive); rather, Plaintiff is only suing to recover what it considers to be its share of the fee 

Defendants received for making the loans, and no matter how you look at that, it is merely an 

incidental benefit of Plaintiff’s work on behalf the borrowers.

13

 Viewed in the light most favorable to Plaintiff, the amended complaint appears to 

sufficiently allege that three of the four defendants—ServisFirst, Synovus, and Truist—were aware 

of the work Plaintiff was doing to assist the borrowers in obtaining PPP loans because they 

communicated directly with Plaintiff about the loan applications. See E & M Marine Corp. v. First 

Union Nat’l Bank, 783 So. 2d 311, 312 (Fla. 3d DCA 2001) (“[A] party is liable for services 

rendered only when he requests the other party to perform the services or knowingly and 

voluntarily accepts their benefits.”) (quoting Coffee Pot Plaza P’ship v. Arrow Air Conditioning 

and Refrigeration, Inc., 412 So. 2d 883, 884 (Fla. 2d DCA 1982)). By contrast, the amended 

complaint does not allege that the other defendant, The First, had any communications with 

Plaintiff about its work on a borrower’s loan application from which it could be inferred that The 

First knew that Plaintiff conferred a benefit on it by performing that work.

14 Even if these counts had survived Defendants’ motions to dismiss (or could somehow be 

amended to state a claim), the Court does not see why Plaintiff would want to expend the resources 

necessary to pursue these claims in this forum because the claims involve less than $5,000 and 

they are not likely to be found suitable for class action treatment. See Vega v. T-Mobile, USA, 

Inc., 564 F.3d 1256, 1274 (11th Cir. 2009) (explaining that unjust enrichment claims are not 

appropriate for class action treatment because “common questions will rarely, if ever, predominate 

an unjust enrichment claim, the resolution of which turns on individualized facts”) (emphasis 

added).

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 12 of 13
13

The Court finds it highly unlikely that Plaintiff will be able to further amend 

the complaint to state a claim against Defendants, but the Court is not yet prepared 

to say that amendment would be “futile” and it will keep an open mind if Plaintiff 

seeks leave to file a second amended complaint. Alternatively, if Plaintiff would 

rather forego further proceedings in this Court and try its luck at the Eleventh Circuit

on the legal issues in this case, the Court will (upon Plaintiff’s request) direct the 

Clerk to enter judgment dismissing the amended complaint with prejudice based on 

the rulings in this Order.

In sum, for the reasons stated above, it is ORDERED that Defendants’ 

motions to dismiss (Docs. 46, 49, 67, 69) are GRANTED, and the amended 

complaint is DISMISSED. Plaintiff may seek leave to file a second amended 

complaint within 14 days of the date of this Order if it can do so in good faith.

DONE and ORDERED this 17th day of August, 2020. 

T. Kent Wetherell, II

T. KENT WETHERELL, II

UNITED STATES DISTRICT JUDGE

Case 3:20-cv-05425-TKW-HTC Document 87 Filed 08/17/20 Page 13 of 13