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Over a dozen groups just told the Supreme Court that a 'successful' return to student-loan repayment 'hinges' on upholding Biden's debt relief, the Education Secretary says

Business Insider logo Business Insider 1/12/2023 (Ayelet Sheffey)
Education Sec. Miguel Cardona. GREG NASH/POOL/AFP via Getty Images © Provided by Business Insider Education Sec. Miguel Cardona. GREG NASH/POOL/AFP via Getty Images
  • Over a dozen groups filed amicus briefs to SCOTUS supporting Biden's student-debt relief.
  • Education Sec. Miguel Cardona said the briefs show how repayment hinges on loan forgiveness.
  • The Supreme Court is hearing oral arguments on the cases on February 28.

Advocates, legal experts, economists, and scholars are keeping pressure on the nation's highest court to allow President Joe Biden's student-loan forgiveness to reach millions of Americans this year.

On Wednesday, over a dozen groups filed amicus curiae briefs to the Supreme Court expressing support for Biden's plan to forgive up to $20,000 in student debt for federal borrowers. This is a critical time for student-loan borrowers — the Supreme Court will hear oral arguments on the two lawsuits that blocked Biden's debt relief on February 28, and it will ultimately decide whether millions of borrowers will resume payments this year with or without a reduction to their loan balances.

The briefs covered a range of topics, from the plaintiffs' standing to sue to student-loan company MOHELA's role in one of the cases. Education Secretary Miguel Cardona said in a statement that they reflect "the strength of our legal positions versus the fundamentally flawed lawsuits aimed at denying millions of working and middle-class borrowers debt relief."

"As these diverse groups made clear today, student loan borrowers from all walks of life suffered profound financial harms during the pandemic and their continued recovery and successful repayment hinges on the Biden Administration's student debt relief plan," Cardona said. "We will continue to defend our legal authority to provide the debt relief working and middle-class families clearly need and deserve."

One of the lawsuits was filed by six Republican-led states who sued because they said the debt relief would hurt their states' tax revenues, along with that of MOHELA. That argument has been widely criticized by advocates and experts who said the states do not have standing to use MOHELA in their case because the company is its own entity, and it can sue and be sued on its own.

A brief filed by UC Berkeley Center for Consumer Law & Economic Justice, on behalf of ArchCity Defenders — a Missouri-based legal advocacy group — and other Missouri consumer advocates, said that "over the years, MOHELA has maintained its autonomy from Missouri, ultimately evolving into a nationwide enterprise with a billion-dollar loan servicing portfolio."

"While Missouri has filed this lawsuit to block the Secretary's debt relief plan, MOHELA—likely motivated by business interests and obligations that diverge from those of the State—has been working to implement the Secretary's plan," the brief continued. "Further, Missouri cannot rely on any predicted losses to MOHELA's loan servicing revenue because even the purported injury to MOHELA is remote and speculative."

The other briefs filed by legal scholars supported the administration's usage of the HEROES Act of 2003, which gives the Education Secretary the ability to waive or modify student-loan balances in connection with a national emergency. The lawsuits, and other conservative critics, have argued that Biden cannot continue relying on the pandemic to enact this relief, but the briefs said its purpose to help borrowers recover from the economic impacts of COVID-19, which can be long-lasting.

When student-loan payments resume also hinge on the Supreme Court's decision. In light of the lawsuits, the Education Department extended the student-loan payment pause 60 days after June 30, or whenever the lawsuits are resolved — whichever happens first — and advocates have stressed that payments should not resume until borrowers receive the relief they were promised.


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