U.S. District Judge Matthew Schelp stated that the potential harm from the student loan cancellation plan outweighs any harm that blocking the program would cause the government.
On October 3, a federal judge halted President Joe Biden’s student loan forgiveness plan, just a day after another judge declined to extend a block on the program.
Referring to a previous appeals court decision in a case related to a different loan forgiveness plan, Judge Matthew Schelp emphasized that the states suing over the program would suffer irreparable harm without a preliminary injunction as the case progresses.
The judge also pointed out that allowing the Biden administration to implement the program before a final decision is made would allow officials to avoid judicial scrutiny of the plan.
The ruling prevents the administration from moving forward with a plan that would forgive up to $20,000 in interest for borrowers who owe more than their original loan amount, and cancel debt for undergraduate borrowers after 20 years and graduate borrowers after 25 years.
States argued that the program was set to start secretly on September 3 and would result in the cancellation of hundreds of billions of dollars in student debt. Previous student debt relief plans proposed by Education Secretary Miguel Cardona had also been blocked by courts.
Administration officials defended their actions, stating that they were in the process of forgiving student loans but were still finalizing the details of the program. They argued that since the states were challenging a plan that was not yet finalized, the case should be dismissed.
A federal judge in Georgia previously issued a temporary restraining order on the plan. On October 2, the same judge declined to extend the order, dismissed Georgia as a plaintiff, and transferred the case to Missouri.
Judge Schelp echoed the reasoning behind the restraining order, emphasizing that the plaintiffs had standing, were likely to succeed in their case, would suffer irreparable harm without a block on the program, and that the potential harm from not blocking the program outweighed any harm to the government.
Missouri Attorney General Andrew Bailey applauded the new ruling, stating that the judge recognized that burdening working Americans with excessive student debt was unjust.
A spokesperson for the Department of Education expressed disappointment with the ruling, vowing to continue defending the proposed student loan forgiveness plans in court.
