Legal Challenge Brought Against U.S. Department of Education’s Unlawful Borrower Defense to Repayment Rule
February 28, 2023
Arlington, VA – Today, a complaint was filed in a Texas federal court challenging the U.S. Department of Education (Department)’s recently promulgated borrower defense to repayment rule (BDR Rule). CECU regional partner Career Colleges & Schools of Texas (CCST) initiated the lawsuit in an effort to set aside the unlawful BDR Rule on the grounds that it violates the U.S. Constitution and the Administrative Procedure Act, which sets out the process and procedures that federal agencies must follow in making and enforcing rules and regulations. CECU supports this effort and is proud of CCST’s leadership in bringing this critical legal challenge to fight for the future of career education students and schools, which are essential to meeting the needs of our country’s healthcare, infrastructure, and other skilled trade industries.
CECU has previously and repeatedly stated that a legal challenge, like the one now brought by CCST, could be necessary if the Department refused to withdraw and replace the deficient BDR Rule, which is currently set to take effect on July 1, 2023. Over the past several months, CECU has spearheaded a multi-pronged campaign to raise awareness about the devastating impact of the BDR Rule and advocate for its withdrawal. We have long supported carefully considered and thoughtful Department rules and policies that promote (as well as protect) the interests of both students and schools alike. This BDR Rule, however, fails in each respect.
CECU is confident that the Texas court will reach the correct legal determination and set aside the newly promulgated BDR Rule, which threatens to irreparably harm the American higher education system and deny generations of students access to career education. Students who are harmed by unlawful actions should be protected, but the Department must also be bound by the law, and act properly within its authority.
“The Department’s newly promulgated rule suffers from fatal due process deficiencies and threatens crippling liability for schools across the country,” said CECU president and CEO, Dr. Jason Altmire. “CECU has led the sector’s response to these unlawful regulations because they irrationally expand the potential acts and omissions of schools that give rise to a borrower defense to loan repayment, while eliminating the procedural protections necessary to protect schools against erroneous loan discharges and presumptions of liability.”
The complaint is available here.
About Career Education Colleges and Universities
Career Education Colleges and Universities (CECU) is the national association serving the proprietary higher education sector.
Please direct media inquiries to Jenny Faubert, Vice President of Communications, at Jenny.Faubert@career.org.