Well, that didn’t take very long. A District Court judge in Michigan has dismissed a lawsuit that challenged an initiative from the federal government seeking to forgive $39 million of student loan debt, determining the plaintiffs lacked standing to sue.
A copy of the ruling in the case of the Cato Institute and Mackinac Center for Public Policy v. Miguel Cardona et al. can be accessed by clicking here.
The Biden Administration announced in July that it was discharging $39 billion in student loans to correct inaccuracies in counting qualifying monthly payments under income-drive repayment programs. In the past, according to the administration and the Department of Education, a “significant” number of payments that should have moved borrowers closer to having their loans forgiven were not accounted for properly.
The groups filed a lawsuit, saying the government didn’t follow the proper rulemaking procedure in launching its plan and that canceling debts for individuals removes any incentive for individuals to participate in the Public Service Loan Forgiveness program. The plaintiffs also filed a motion for a temporary restraining order and preliminary injunction to block the plan from going into effect. As qualified employers under the PSLF, the plaintiffs alleged they have suffered a concrete injury because their employees are impacted by this plan.
But the plaintiffs weren’t stripped of their status, noted Judge Thomas L. Ludington of the District Court for the Eastern District of Michigan, even though the defendants did not follow the notice-and-comment rulemaking under the Administrative Procedures Act.
“Plaintiffs’ presidents’ own declarations do not suggest that any employee was actually impacted by the Adjustment,” Judge Ludington wrote. “Their declarations merely assert that Plaintiffs plan to recruit PSLF participants in the future, some of whom may be impacted by the Adjustment. This is far too speculative for standing.”
