# US Department of Education student loan litigation

> Developing situation record from CLSTR: https://clstr.news/situations/us-department-of-education-student-loan-litigation
> Updated: 2026-11-02T20:52:00.000Z. Sources: 7. Developments: 3.

The US Department of Education is facing multiple legal challenges regarding student loan relief and the administration of the Public Service Loan Forgiveness (PSLF) program.

A class action lawsuit filed by the nonprofit Student Defense alleges the department failed to discharge loans for borrowers who attended closed for-profit colleges, such as Career Education Corporation, Education Management Corporation, Education Corporation of America, and Bay State College. Concurrently, the department has withdrawn appeals against court rulings that struck down regulations intended to restrict the PSLF program, leaving the current structure of the program intact.

Further legal action has been taken by the American Federation of Teachers (AFT), which filed a class action lawsuit against the department and Secretary Linda McMahon. The AFT, alongside nine borrowers, alleges gross mismanagement of the PSLF program. Specific allegations include incorrect payment history calculations, failure to credit qualifying employment, and a significant backlog in the PSLF Buyback program, which allows borrowers to retroactively claim credit for months lost due to forbearance or deferment. Plaintiffs claim the department is actively delaying or denying loan forgiveness to eligible public servants who have met program requirements, such as making 120 qualifying monthly payments. 

The department has responded to claims of reduced payment counts by stating these were necessary corrections to coding errors from the previous administration.

## Timeline

### 2026-11-02: Public servants file class action lawsuit over student loan forgiveness

The American Federation of Teachers and nine borrowers have sued the U.S. Department of Education, alleging mismanagement and unfair denials within the Public Service Loan Forgiveness program.

2 sources. https://clstr.news/cluster/public-servants-file-class-action-lawsuit-over-student-loan-forgiveness

### 2026-10-30: American Federation of Teachers sues Department of Education over student loan delays

The American Federation of Teachers is suing the U.S. Department of Education, alleging mismanagement of the Public Service Loan Forgiveness program and delays in processing debt relief.

3 sources. https://clstr.news/cluster/american-federation-of-teachers-sues-department-of-education-over-student-loan-delays

### 2026-10-29: US Department of Education faces legal challenges over student loan relief

The US Department of Education faces a class action lawsuit over loan discharges for closed colleges and has withdrawn appeals against court rulings that protected Public Service Loan Forgiveness regulations.

3 sources. https://clstr.news/cluster/us-department-of-education-faces-legal-challenges-over-student-loan-relief

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Cite as: US Department of Education student loan litigation. CLSTR, https://clstr.news/situations/us-department-of-education-student-loan-litigation