Why a student-loan company's involvement in a case seeking to block Biden's debt relief might end up working in borrowers' favors
If you didn't think a student-loan company in Missouri would play such a central role in whether President Joe Biden's debt relief plan can move forward, think again.
"It would be hard to see how a win for the state would benefit MOHELA, or a win for MOHELA would benefit the state, if the assets are completely separate — you don't get any money out of it," conservative Supreme Court Justice Amy Coney Barrett"If MOHELA is an arm of the state, why didn't you just strong-arm MOHELA and say, 'You've gotta pursue this suit?'" Barrett asked.
But the justices appeared skeptical of the claim that the state would be directly harmed by the company's revenue loss. Solicitor General Elizabeth Prelogar reiterated that MOHELA is separate from the state can can sue, and be sued, on its own. So, as Nahmias said, MOHELA's role in the case really threw into question the plaintiffs' standing — and the skeptical line of questioning from the justices could be a good sign.
"So we're talking about a fund that hasn't been contributed into because the state has waived the obligation to do so for at least a temporary period of time, and then, even if the funds were to go into this particular fund, you don't have a set of plans that you are planning to pursue with them?" Jackson said.
"It is way too speculative to believe that Missouri, come 2024, is going to first, need to collect on the debt to the Lewis and Clark fund when that fund is essentially dead," Nahmias said."And two, that President Biden's debt relief plan would impact MOHELA such that MOHELA could not even start paying back its debts to the Lewis and Clark Fund."As expected, the conservative and liberal justices split on some issues concerning student-debt relief during their questioning.
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