A group of former students sued the Department of Education on Wednesday, claiming the agency refused to discharge their eligible student loans.
The plaintiffs, represented by Student Defense, a nonprofit consumer protection group, borrowed money to attend for-profit colleges owned by Career Education Corporation, Education Management Corporation, Education Corporation of America, and Bay State College. In January 2025, just before leaving office, President Joe Biden's Education Department determined those colleges had closed under "exceptional circumstances." Under department regulations in place for more than 30 years, that determination expanded who qualified for loan forgiveness to include borrowers enrolled at closure or who withdrew within a certain time before it.
The Trump administration has refused to implement the Biden-era decision, according to the lawsuit filed in federal district court. The borrowers "remain obligated to repay federal student loans that the Secretary has already determined are eligible for discharge" and continue accruing interest, the suit alleges. Some may face collection through Treasury offset or administrative wage garnishment.
Kendrick Gaussoin, the named plaintiff, attended Brooks Institute, owned by Career Education Corporation, before it closed in 2016. He did not finish his degree. "When the Department expanded relief for Brooks students, I was overjoyed. I qualify, but my application was denied anyway," he said. "Now I am a father of two, struggling to get by and still carrying debt for a school that failed me."
Ellen Keast, a Department of Education spokesperson, defended the refusal. "The Biden Administration was laser-focused on implementing unlawful policies to shift student loan debt onto the back of every single hardworking American taxpayer," she told NPR. "Literally days before leaving office, the former Biden Under Secretary used the stroke of a (digital) pen to inappropriately expand the closed-school discharge period for certain institutions targeted by the previous Administration."
The first Trump administration had expanded the look-back period for some borrowers. In 2019, then-Education Secretary Betsy DeVos cited "exceptional circumstances" to expand the period for students who borrowed to attend the now-defunct Art Institute of Colorado or Illinois Institute of Art.