Twenty-two attorneys general have filed a lawsuit challenging new U.S. Department of Education regulations that could exclude people with federal student loans from Public Service Loan Forgiveness, or PSLF, eligibility based on whether their employers engage in actions that the Trump Administration determines to have a “substantial illegal purpose.”
The rule threatens PSLF eligibility for organizations that are engaged in legal activities, such as providing legal services to immigrants, providing gender-affirming care to minors, participating in diversity, equity, and inclusion, or DEI, initiatives, or engaging in civil protest and the right to assembly.
In the lawsuit, the attorneys general asked the court to declare the now final rule unlawful, vacate it, and bar the department from enforcing or carrying it out.
“Millions of Americans shaped their lives, made long-term career decisions, and took on deep financial burdens based on the promise that, if they dedicated their lives to public service and made student loan payments for 10 years, their government would support them,” California Attorney General Rob Bonta said in a statement. “Now, the Trump Administration is pulling the rug from under hardworking Americans who absolutely deserve what they were promised.”
Bonta said this is the latest example of the Trump Administration’s weaponization of the federal government to go after people it doesn’t agree with, while betraying the institutions that uphold the country’s democracy.
Among other states joining the lawsuit are Arizona, Delaware, Hawai’i, Illinois, Maine, Minnesota, New Jersey, Oregon, Washington, and Wisconsin.
Four public-interest organizations have also filed a lawsuit to challenge the new PSLF rule. The plaintiffs are Robert F. Kennedy Human Rights, the American Immigration Council, The Door – A Center of Alternatives Inc., and the League of United Latin American Citizens, represented by Student Defense and the Public Citizen Litigation Group.
The lawsuit asks the court to declare the new rule unlawful and to declare that the department lacks the legal authority to change the statutory criteria for PSLF.
“Congress created PSLF to support those who work in public service jobs, not to let the President play favorites,” Cormac Early, attorney at Public Citizen Litigation Group, said in a statement. “The Trump administration should not be allowed to use a program designed to reward public service as a weapon against its political enemies.”
