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Attorney General Kilmartin Wins Federal Court Ruling Against Education Secretary DeVos for Delaying Student Loan Protections

Attorney General Peter F. Kilmartin won a victory in federal court against Education Secretary Betsy DeVos after challenging the U.S. Department of Education's plan to abandon federal protections for students cheated by predatory, for-profit schools. The opinion called Secretary DeVos' actions unlawful and ordered an immediate hearing in Washington, D.C to determine remedies.

"We are pleased with the Court's decision in finding Secretary DeVos and the Department of Education postponement of the Borrower Defense Rule procedurally improper. States worked diligently with the Department of Education for several years to develop regulations and safeguards to protect students from predatory for-profit colleges which often left students with near-worthless certificates and skyrocketing student loan debt. I appreciate the Court's recognition of the importance to move forward with the Borrower Defense Rule and willingness to immediately consider remedies," said Attorney General Peter F. Kilmartin, who was one of 20 attorneys general who filed the lawsuit. "This wasn't the first attempt by Secretary DeVos to derail protections for students, and unfortunately it won't be the last, but at each step of the way, attorneys general will continue to be there to stop further erosion of important consumer protections."

The decision, filed yesterday in the U.S. District Court in Washington, D.C., is the result of a multistate lawsuit by 20 attorneys general, alleging that the U.S. Department of Education violated federal law by abruptly rescinding its Borrower Defense Rule which was designed to hold abusive higher education institutions accountable for cheating students and taxpayers out of billions of dollars in federal loans.

Judge Randolph Moss of the United States District Court for the District of Columbia has scheduled a status conference for Friday, Sept. 14 at 10:30 a.m. to address remedies. The Massachusetts Attorney General's Office will be asking the court to order the Department to implement the Borrower Defense Rule immediately and in full.

The Borrower Defense Rule was finalized by the Obama administration in November 2016 after nearly two years of negotiations, following the collapse of Corinthian Colleges, a national for-profit chain. The rule was set to go into effect on July 1, 2017.

In May 2017, Secretary DeVos announced that the Department was reevaluating the Borrower Defense Rule and later announced its intent to delay large portions of the Borrower Defense Rule without soliciting, receiving, or responding to any comment from any stakeholder or member of the public, and without engaging in a public deliberative process. The Department simultaneously announced its intent to issue a new regulation to replace the Borrower Defense Rule.

Without the protections of the Borrower Defense Rule, many students defrauded by for-profit schools are unable to seek a remedy in court. The rule also prohibits schools from enforcing mandatory arbitration agreements and class action waivers, which are commonly used by for-profit schools to thwart legal actions by students who have been harmed by schools' abusive conduct.

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