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Judge dismisses student loan cancellation suit for lack of standing


A federal judge dismissed a legal challenge to President Biden’s student loan cancellation plan on Thursday, determining the plaintiff did not have standing as a taxpayer.

The Brown County Taxpayers Association filed one of the most recent challenges to Biden’s plan on Tuesday, arguing the president did not have the authority to forgive up to $20,000 in student debt per borrower and the plan violated the Equal Protection Clause because the administration indicated it was designed to especially help Black borrowers.

Under court precedent, taxpayers do not automatically have standing to sue simply because a government spending plan would cause a tax increase. 

But the association, which is represented by Wisconsin Institute for Law and Liberty, argued its case should fall under an exception crafted previously by the Supreme Court for some suits involving religious freedom violations.

U.S. District Court Judge William Griesbach rejected that argument on Thursday, adding that even if the group did have standing for the case to proceed, it is “unclear” if they would succeed in their request to temporarily block the plan.

The case is one of multiple legal challenges to Biden’s cancellation announcement. Six Republican-led states filed a challenge late last month that remains ongoing, and outside groups have also contested the plan.

Attorneys representing the Brown County Taxpayers Association said they plan to appeal and seek emergency relief given the Biden administration’s indication that the debt forgiveness could begin in the coming weeks.

“This case involves an extraordinary abuse of executive authority which, in our view, requires an exceptional use of taxpayer standing,” said Rick Esenberg, one of the group’s attorneys. “These issues will now be reviewed by the appellate courts.”

The judge on Thursday noted that if the association’s claims were accurate, a future administration could look to collect the purportedly forgiven debts.

“Because Plaintiff lacks standing, that issue is not before the court at this time,” Griesbach wrote. “Those seeking to take advantage of the program, however, may wish to consider this possibility before placing undue reliance on the benefits promised.”

The group had argued that beyond usurping Congress’s authority, the debt cancellation plan violated the 14th Amendment’s Equal Protection Clause because the White House touted the initiative as being designed to advance racial equity.

“By targeting relief to borrowers with the highest economic need, the Administration’s actions are likely to help narrow the racial wealth gap,” the White House wrote in a fact sheet. “Black students are more likely to have to borrow for school and more likely to take out larger loans.”

The taxpayers’ association cited the statement in the now-dismissed complaint.

“By creating and implementing a federal program with an improper racial motive, Defendants violated the Constitution’s guarantee of equal protection of the laws, which among other things, prohibits federal spending based on race,” they wrote.

Source: The Hill

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