On Monday, the Job Creators Network Foundation Legal Action Fund a conservative organization filed a lawsuit to block Biden’s up to $20,000 in student-debt cancellation announced at the end of August. It’s at least the fifth major lawsuit filed against the relief, and it comes just one day before a federal judge is set to hear arguments from six Republican-led states who claimed the loan forgiveness will hurt their states’ tax revenues and should be halted.
The Job Creators lawsuit argues that the loan forgiveness violates the Administrative Procedure Act’s notice-and-comment procedure, which requires an unelected administrator to justify rulemaking to the public. The group wrote in the court filing that the Education Department never sought public comment on the debt relief, and instead, “the countless legal, policy, economic, and other issues implicated by such a program were all debated and determined in secret” and with the goal of implementing the policy before the November midterms to help Democrats win votes.
They’re calling “on the court to stop this counterproductive, inflationary, and unfair action from taking effect,” per the press release.
“By shifting the burden to taxpayers, including those who didn’t go to college or paid their student loans back, colleges escape responsibility for their actions creating the student loan crisis,” Elaine Parker, President of Job Creators Network Foundation, said in a statement. “They are given carte blanche to continue their ridiculous pricing. Bailing out this debt only kicks this problem down the road. By blocking this inflationary taxpayer bailout, JCN’s lawsuit can lay the groundwork to actually solve the student debt crisis by holding its college perpetrators accountable.”
The lawsuit lists two plaintiffs in the case one is suing because he does not qualify for the full $20,000 in debt relief since he was never a Pell Grant recipient himself. He believes the amount of relief he receives shouldn’t be “based on the financial circumstances of his parents many years ago.” The other is suing because her commercially-held student loans do not currently qualify for Biden’s loan forgiveness. The Education Department recently updated its guidance to note that while borrowers with privately-held loans will not be able to access the relief, it will continue to assess ways to help those borrowers separately.
And Biden’s administration even referenced the argument that the relief will advance the president’s political goals in a legal defense it filed at the end of last week, calling the claim “unsurprising and legally insignificant” because policymaking is seldom “unaffected by policy considerations.”
While it’s unclear how this lawsuit will progress, at least two other lawsuits have been struck down by federal judges over a lack of standing, and the administration continues to believes its relief is legally sound. While it said in its legal defense that no student debt will be canceled before October 23, it is continuing to move forward with the implementation process and is testing out the application for debt cancellation with members of the general public before making it available for all borrowers, likely later this month.