Judge denies student debt cancellation lawsuit after Education Department clarifies plan

A federal judge on Thursday denied a challenge to President Biden’s student debt forgiveness plan filed by the Pacific Legal Foundation (PLF).

PLF on Tuesday became the first organization to challenge the Biden administration’s move to forgive up to $20,000 in student debt per borrower, alleging it is illegal because Congress, which holds the power of the purse, did not approve it.

The group filed the suit on behalf of one of its attorneys, alleging he would suffer irreparable harm because the plan would automatically forgive his debt and force him to face state tax liability.

“Nearly 8 million borrowers may be eligible to receive relief automatically because their relevant income data is already available to the Department,” read a White House fact sheet cited in the suit.

But the judge on Thursday denied the motion after the Department of Education updated its website to clarify no one would be forced to take part in the debt forgiveness, a clarification that came after the department cast the lawsuit as “baseless” for claiming they would.

“If you would like to opt out of debt relief for any reason, including because you are concerned about a state tax liability, you will be given an opportunity to opt out,” the department’s website reads after Wednesday’s update.

U. S. District Court Judge Richard Young ruled that the PLF attorney can no longer be irreparably harmed by the policy since he can now opt out, throwing out his motions for a temporary restraining order and preliminary injunction to halt Biden’s plan.... (Read more)

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