AG Healey can pursue student loan debt lawsuit, judge rules
A Massachusetts state court judge has ruled that Attorney General Maura Healey can pursue her lawsuit against a national student loan servicer for unfair and deceptive practices.
A Suffolk County Superior Court judge Wednesday denied a request by the Pennsylvania Higher Education Assistance Agency to dismiss the case.
The case has drawn national attention because the Justice Department and Department of Education sided with the loan servicer and argued that Healey had overreached her authority. Healey applauded the decision Thursday. “It is critical that this case move forward so that student loan borrowers can get the relief they deserve,” she said in a statement.
Healey has alleged that the servicer, which does business as FedLoan Servicing, violated state and federal laws by causing teachers and others to lose benefits and financial help under the Public Service Loan Forgiveness program. Under the program, students can have loans forgiven after 10 years of public service, a benefit designed to encourage graduates to take jobs in government and nonprofits.
Bloomberg reported the United States may issue a statement arguing states can’t regulate firms collecting student debt, effectively shielding them from state probes and lawsuits.