Trump administration drops appeal over student-loan forgiveness rule after court vacates it
Permanent article number: 102126006 Find another article by number
Evidence and accountability
Accountable person, organization or policy: Trump administration / Education Department
Documented issue under review: Dropped its appeal defending a rule that federal judges had already blocked as exceeding statutory authority and threatening First Amendment protections.
This report has an independent editorial fact-audit recorded in the archive. Check the linked source documents below for the underlying evidence; where a case remains pending, allegations are not findings.
Questions sent by The Radical Reading Room
These requests have a recorded outbound message ID and send time. A request for comment does not establish that its recipient read the message.
U.S. Department of Education Press Office — Press office
Question: How many employers or borrowers were estimated to be affected by the PSLF 'substantial illegal purpose' exclusion?
Contacted: October 22, 2026 at 1:37 AM (server time).
Status: Response pending; no substantive response recorded.
The Trump administration has dropped its appeal in a case over a Public Service Loan Forgiveness rule that would have allowed the Education Department to bar employers from the program if officials concluded they had a “substantial illegal purpose.” The withdrawal, reported Oct. 21, 2026, leaves in place a June 30 court ruling that vacated the rule after finding it unlawful.
The department finalized the rule on Oct. 30, 2025, as part of its effort to narrow which employers could qualify for PSLF, the federal program that cancels student debt for borrowers who make 10 years of qualifying payments while working in public service jobs. Under the rule, the Education Secretary could have excluded an employer from the program based on that “substantial illegal purpose” standard.
Opponents challenged the rule in federal court, arguing that it exceeded the department’s authority and raised constitutional concerns. On June 30, 2026, the court vacated the rule, stopping it before it could take effect on July 1, 2026. The Education Department had appealed that decision, but it later withdrew the appeal.
The result is a concrete legal retreat for the administration and a significant setback for a policy it had framed as an anti-abuse measure. The practical effect is that the vacatur remains in place unless a new rulemaking or another successful appeal changes the outcome. The Associated Press reported the withdrawal the same day, underscoring that the administration did not press ahead with its defense after losing in district court.
Comments
Threaded replies, voting, and reports are live. New users still go through screening on their first approved comments.
Log in to comment
No comments yet. Be the first reasonably on-topic person here.