(Source: MIRS.news, Published 05/17/2024) A federal appeals court affirmed Friday’s dismissal of two think tanks’ lawsuit challenging the U.S. Department of Education’s (USDOE) student loan forgiveness programs.
In a published opinion, the U.S. Sixth Circuit Court of Appeals agreed with the lower court’s dismissal of the Mackinac Center for Public Policy and Cato Institute’s suit for lack of subject-matter jurisdiction.
“This case turns on whether plaintiffs have clearly alleged facts showing that they suffered an injury in fact due to the Department of Education’s account adjustment for student-loan borrowers,” Circuit Judge Andre B. Mathis wrote in the court’s opinion. “… But the complaint stumbles out of the gate.”
The court held that the plaintiffs' complaint doesn’t show “specific, concrete facts,” rather it includes “numerous legal conclusions masquerading as facts.”
The think tanks’ August 2023 lawsuit sought to block the Biden administration’s scaled-back plan to cancel $39 billion in student loans, alleging the “unlawful reduction” of the Public Service Loan Forgiveness (PSLF) and Income-Driven Repayment (IDR) programs “injures public service employers that rely on PSLF to recruit and retain college-education employees.”
Both the Mackinac Center and Cato are nonprofit, tax-exempt organizations that are qualified public service employers under the PSLF program.
The district court dismissed the complaint before the defendants could respond, holding they lacked standing.
In March, the U.S. Attorney argued before the appeals court that the two free-market think tanks lacked standing because they are not in competition with student loan borrowers, and the plaintiffs’ attorney argued the adjustment economically disadvantaged the plaintiffs, in part, by undermining public service employers’ recruitment and retention efforts.
The appeals panel, including Circuit Senior Judges Eugene E. Siler Jr. and R. Guy Cole Jr., however, rejected the plaintiffs’ argument that the loan reduction harmed their ability to recruit or retain college-educated employees.
