Colleges Appeal Borrower-Defense Settlement to Supreme Court
Katherine Knott
April 6, 2023
After a federal appeals court denied a bid from some colleges to stop a settlement from moving forward in a class action lawsuit against the U.S. Department of Education regarding stalled borrower defense to repayment claims, those colleges are asking the U.S. Supreme Court to intervene.
In an emergency application to Justice Elena Kagan filed Tuesday, Lincoln Educational Services Corporation, Everglades College Inc. and American National University want the court to say whether the Higher Education Act of 1965 allows the education secretary “to cancel and refund federal student loans en masse and outside statutorily defined circumstances.” The colleges also want the court to decide whether the secretary has the authority to provide student loan cancellation and refunds as part of a settlement.
The settlement in the case Sweet v. Cardona, which received final approval in November, canceled $6 billion in student loans for more than 200,000 borrowers who attended one of the more than 150 institutions identified by the Education Department, including those that appealed. Most of the institutions on the department’s list, known as Exhibit C, are for-profit colleges or universities.
