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Lawsuit Challenging Biden’s Student Loan Forgiveness Plan Gets Dismissed, But Legal Battle Continues

A key lawsuit challenging President Biden’s one-time student loan forgiveness program was dismissed this week in Arizona. But the legal battle over Biden’s signature initiative continues, as the Supreme Court prepares to consider two other challenges in just a matter of weeks.

Here’s the latest.

Arizona Dismisses Student Loan Forgiveness Legal Challenge

Biden’s one-time student loan cancellation initiative would have provided up to $20,000 in federal student loan forgiveness for tens of millions of borrowers whose income fell within eligibility guidelines. But there have been multiple legal challenges to the program, and as a result, no student loan forgiveness has been issued yet under the plan.

While most lawsuits challenging the program were dismissed last year, one suit in Arizona originally filed by former Republican Attorney General Mark Brnovich had continued. Brnovich had argued that widespread student loan forgiveness was illegal and would financially harm the state of Arizona by making it harder for the state government to recruit employees, as fewer borrowers would benefit from other key federal programs like Public Service Loan Forgiveness if they had their student debt cancelled under Biden’s plan.

Following the midterm elections, newly-installed Arizona Democratic Attorney General Kris Mayes formally dismissed the suit earlier this week. “Plaintiffs State of Arizona and Kristin K Mayes in her official capacity as Attorney General of Arizona hereby voluntary dismiss without prejudice this action against Defendants Joseph R. Biden, in his official capacity as the President of the United States, Miguel Cardona, in his official capacity as Secretary of Education, and the United States Department of Education,” said the brief legal filing.

Supreme Court to Hear Two Other Legal Challenges to Biden’s Student Loan Forgiveness Program

The legal battle over Biden’s student loan forgiveness program continues, however. Next month, the Supreme Court is set to hear oral arguments in two lawsuits challenging the initiative. Last fall, lower federal courts blocked the program at earlier stages of the litigation.

In a legal brief filed earlier this month, the Biden administration defended the program, arguing that the HEROES Act of 2003 — a federal statute that allows federal student loan programs to be modified during or following national emergencies — authorizes the relief.

Since then, several outside organizations have filed amicus curiae briefs with the court, arguing that the challengers are unable to demonstrate that they have sufficient legal standing to prevail. Standing is the legal concept that a party filing a lawsuit has to show that they are likely to incur a concrete injury sufficiently connected to the challenged policy.

The Biden administration has expressed confidence that it will ultimately prevail before the Supreme Court. “The Biden-Harris Administration remains committed to fighting to deliver essential student debt relief to tens of millions of Americans,” said Education Secretary Miguel Cardona in a statement on earlier this month. “We remain confident in our legal authority to adopt this program that will ensure the financial harms caused by the pandemic don’t drive borrowers into delinquency and default.”

Further Student Loan Forgiveness Reading

Will You Be Taxed On Student Loan Forgiveness In 2023? Key Details

Student Loan Forgiveness: These Deferment And Forbearance Periods May Count

Here’s What You’ll Pay, And When You’ll Get Student Loan Forgiveness, Under Biden’s New Plan

Your Student Loan Forgiveness Is Getting Delayed, And It May Get Worse

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