Judge dismisses conservative group's lawsuit against student debt forgiveness

A federal judge tossed out a lawsuit from the right-wing law outfit Wisconsin Institute for Law & Liberty (WILL) that challenged the Biden Administration’s student debt forgiveness plan.

WILL had filed the lawsuit earlier this week on behalf of the Brown County Taxpayers Association, arguing the plan to forgive up to $20,000 in student loan debt for people who make less than $125,000 a year is illegal executive overreach.

Eastern District of Wisconsin Judge William C. Griesbach dismissed the lawsuit, writing in his decision that the BCTA did not have the grounds to bring the lawsuit. WILL had argued that because the BCTA’s members pay federal taxes, they’re able to bring a suit against the executive branch’s use of that money.

“The Supreme Court has repeatedly held, however, that the payment of taxes is generally not enough to establish standing to challenge an action taken by the Federal Government,” wrote Griesbach, an appointee of President George W. Bush.

WILL said after the dismissal that it planned to appeal the decision.

“This is an extraordinary case based on an extraordinary claim of executive power by the President,” WILL deputy counsel Dan Lennington said in a statement. “This case was always destined to be decided by higher courts, and we will continue the fight to the Court of Appeals and then the U.S. Supreme Court if necessary.”

The lawsuit is one of several across the country challenging the loan forgiveness plan, but WILL gained attention for using a racial argument in its suit. The White House has said the plan will narrow the racial wealth gap, a reason WILL argued amounts to an “improper racial motive” and a violation of the Constitution’s equal protection laws.

Previously, WILL has filed lawsuits against other Biden Administration programs that attempted to benefit people of color. In 2021, the group successfully killed a program that provided aid to Black farmers.

The application for student debt forgiveness is expected to be released sometime this month. WILL had asked Griesbach to order a temporary injunction that the applications not be released, a step that he said was unclear he could take, even if the BCTA had standing because “a substantial question remains as to whether Plaintiff can demonstrate that it will suffer irreparable harm.”

About 685,000 borrowers in Wisconsin will be eligible for relief under the Biden plan, which will forgive $10,000 in debt for borrowers who earn less than $125,000 a year, or couples who earn less than $250,000 a year. Pell grant recipients will be eligible for up to $20,000 in debt forgiveness.

According to the Federal Reserve Bank of New York, at the end of 2021, Wisconsin had 785,600 borrowers with a collective $24.7 billion in student loan debt. The average balance is $31,482, while the median balance is $17,037. The delinquency rate on those loans is 6%.

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