Last October, James O'Keefe released a video on the topic of federal contracting, specifically the way in which minority set-asides work. That may not sound very sexy but it's potentially illegal. 

Here's how it works. The government has special set-aside contracts for minority businesses. For instance, if the business is owned by a black person or a Native American person, there are certain contracts that can only be won by a certified minority owned business. Part of this system is that the business that receives this special consideration to earn the work must do the work itself, or at least the majority of it. What it cannot do is use its status as a minority-owned business to win the contract and then pass on the actual work to some subcontractor. That's called pass-through fraud and it's a crime.

So here's O'Keefe's video from last year in which he goes undercover himself in a very bad wig.

$100 Billion Federal Contracting Scam Exposed: 8(a) Firm Admits to Violating Federal Law, Using Minority-Owned Status as a Front to Obtain $100M+ No-Bid Government Contracts While Outsourcing 80% of the Work.

ATI Government Solutions Contract Manager, Melayne Cromwell Admits to Exploiting 8(a) SBA Program Through Pass-Through Scheme & Breaking Federal Law.

“I tell you pass throughs are a great thing!”

“We only do 20%… The rest goes to subs..."

“And remember, there's no competition…”

ATI Government Solutions, the company featured in this video, has now filed a lawsuit against the government claiming that they were unfairly cut off from all government contracts as a result of the video.

The person’s employer, ATI Government Solutions, is now fighting back in court after the video published by O’Keefe — whom ATI called a “known online provocateur” — has cost the company $130 million in canceled government contracts, it alleges, plus more than $500 million in prospective business.

ATI filed a lawsuit on Thursday not against O’Keefe but against the federal government, alleging that the U.S. Small Business Administration and the Trump administration official in charge of the agency, Kelly Loeffler, unlawfully barred the company from federal contracting based on “unfounded allegations” in what ATI calls a heavily edited and manipulated video.

In the complaint, filed in U.S. District Court for the District of Columbia, ATI alleges that Loeffler — a Republican who briefly served as a U.S. senator from Georgia — quickly amplified O’Keefe’s report on social media, claimed that it was evidence of fraud against the government and an abuse of government diversity initiatives, and then began taking action against the company, which is owned by the Susanville Indian Rancheria tribe...

O’Keefe, the company said, “took issue with ATI’s success” and on Oct. 20, 2025, he “scammed a low-level former employee,” who he falsely claimed was in senior company leadership. The complaint says that O’Keefe met with the person under false pretenses and “baited” the person into agreeing with his own “mischaracterizations” about how ATI operated.

The Post has already had to run a correction on this story.

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A previous version of this article incorrectly said that James O'Keefe pleaded guilty to a misdemeanor charge of illegally entering a government building and that he and three others had attempted to tamper with a senator's phone. Instead, O'Keefe pleaded guilty to a misdemeanor charge of entering federal property under false pretenses. He and two others who were dressed as phone repairmen were seeking to secretly record staff conversations. A fourth person waited outside. In addition, the article incorrectly identified a person in a video with O’Keefe as a man.

Oops! O'Keefe has made a point of correcting false claims about the 2010 incident which is regularly mischaracterized in the media. Here's O'Keefe's response to word of the lawsuit.

JUST IN: ATI Government Solutions is SUING @SBAgov and @SBA_Kelly after O’Keefe Media Group caught ATI’s Director of Contracts on hidden camera spilling that the company secured over $100 MILLION in no-bid federal contracts using its Native American-owned status while subcontracting 80% of the work, which is against federal law. The SBA subsequently suspended ATI from all federal contracting.