A new lawsuit claims the plan bypassed public input and doesn't address the true cause of debt - college costs.
Six Republican-led states filed suit late last month, accusing the Biden administration of overstepping its executive powers, as did the Pacific Legal Foundation, a Sacramento, California, legal advocacy group. Their lawsuit, filed in federal court in Indiana, calls the plan an illegal overreach that would increase state tax burdens for some Americans who get their debt forgiven.
The suit includes two plaintiffs: one who does not qualify for debt forgiveness because the plan excludes commercially held loans that are not in default, and one who did not receive a Pell grant and is therefore entitled to less debt forgiveness under the plan. The case was assigned to U.S. District Judge Reed O'Connor, who most notably ruled in 2018 that the Affordable Care Act was unconstitutional. The Supreme Court reversed that decision last year. O'Connor, an appointee of former President George W. Bush, also has ruled against other policies pursued by Democratic administrations. Last month, he ruled that an ACA provision that required coverage of an HIV prevention drug violates a Texas employer's religious beliefs.
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