Trump Admin to Defend Borrower Defense Regs at Supreme Court

The Education Department is planning to defend before the Supreme Court the Biden administration’s rule that makes it easier for students misled or defrauded by their colleges to access debt relief.

The Supreme Court said in January that it would review an appeals court decision that put the policy on hold after finding the regulations had “numerous statutory and regulatory shortcomings.” The regulations were finalized in October 2022 but blocked in summer 2023.

But the Trump administration asked to pause the high court’s review in order to “reassess the basis for and soundness of its borrower-defense regulations.” Following that review, lawyers for the administration decided to fight the appeals court ruling and defend the policy, according to a four-page motion filed May 29. That decision paves the way for the court to consider the case in its next term, which begins in October.

Under the borrower defense to repayment program, borrowers can apply for debt relief if their college or university misled them or violated certain state laws. The new regulations simplified the application process for affected students and allowed the department to automatically discharge student loans in some cases. Additionally, the department could provide borrower-defense relief to whole groups of affected students rather than on an individual basis.

Solicitor General John Sauer wrote in the filing that in the administration’s view, the Higher Education Act gives the department the authority to grant borrowers relief before they default and on a group basis.

“In the department’s view, the court of appeals erred in adopting a contrary interpretation of the statute,” Sauer wrote. “The government continues to regard the issue as one of exceptional and lasting importance. Indeed, if this court were to reject the court of appeals’ interpretation of the statute, the department would exercise its statutory authority to promulgate a new borrower-defense regulation to replace the 2022 Rule.”

Since the appeals court decision, borrower-defense rules finalized during the first Trump administration remain in effect.

The filing also keeps the regulations alive while Congress works to roll them back via reconciliation. The One Big Beautiful Bill Act, which passed the House in late May, rescinds the 2022 regulations, which save about $11.5 billion over the next 10 years. The overall legislation aims to cut about $1.4 trillion in order to pay for tax cuts and President Donald Trump’s other priorities.