Calvillo Manriquez v. DeVos
Four borrowers filed a nation-wide class action lawsuit against the Department of Education for illegally and unfairly denying relief to tens of thousands of former Corinthian students whom the Department of Education determined are entitled to have their loans discharged and their loan payments refunded. These borrowers are represented by the Project on Predatory Student lending and the Housing and Economic Rights Advocates (HERA).
All four borrowers, and all class members, are entitled to relief pursuant to the Department’s Corinthian Job Placement Rate Rule, which it has established through countless public statements, previous discharges, and direct notice to tens of thousands of covered individuals. Rather than applying this Rule to the class, the Department has partially denied their claims by engaging in a secret calculation using illegally-obtained income data. Based on its arbitrary analysis, and despite finding that the students were cheated by their school, the Department is now requiring some class members to pay a substantial portion of their loans. It is unlawful for the Department to deny the class members the full loan discharge and refunds that they are entitled to. A federal Judge has set an April 30, 2018 hearing date on a preliminary injunction sought against Secretary Betsy DeVos and the federal Department of Education seeking to block the administration from applying its decision to partially deny loan relief applications brought by defrauded former students of for-profit colleges.
This case against the Department of Education was brought by four named plaintiffs:
- Martin Calvillo Manriquez was talked into WyoTech’s automotive technology program over community college. He did not have an opportunity to work with cars or car parts while he was enrolled. The school didn’t have tools or certified instructors. While he was in school, he worked at an oil change shop earning $8 an hour. His classmates who graduated from the same program were applying for the same low-paying, non-technical job he already had. Most of them didn’t even get jobs changing oil. Martin has never had a job related to auto repair. Even though the Department determined that Martin was misled and cheated, and even though he applied to have his loans discharged, the Department has taken two years of tax refunds and garnished his wages to pay back his loans.
- Rthwan Dobashi owes more than $20,000 for the same automotive technology program at WyoTech. He has also never worked in the field. In early 2016, he found out from the attorney general that he was eligible to have his debts from WyoTech cancelled, and he applied. He also told one of his friends from school, and his friend applied, too. His friend’s loans were discharged almost a year ago, while Rthwan still hasn’t heard anything from the Department.
- Jamal Cornelius’s attended the Information Technology-Emphasis in Network Security program at Corinthian owned Heald College and borrowed more than $25,000 for the program. His debt from Corinthian is the only line on his credit report. He has been waiting more than fourteen months for any response to his application for relief.
- Jennifer Craig attended the Medical Insurance Billing and Coding Diploma program at Corinthian-owned Everest College. She borrowed more than $9,000 for the program and has never held a job in the industry because Everest failed to provide her the requisite training for a job in the field. After waiting almost two years for a response for her application for relief, the Department partially denied her application. Despite finding that she was misled and that her loans were fraudulent, the Department is now requiring her to pay 80% of her unlawful loans.
Update | Department of Education Illegally Slashes Debt Relief for Corinthian Borrowers
Martin was talked into WyoTech’s automotive technology program instead of community college. But the program was a complete fraud – he rarely touched a car while there, and the great jobs promised to him were unavailable.
Named Plaintiffs Martin Calvillo Manriquez, Jamal Cornelius, and Rthwan Dobashi borrowed federal student loans in order to attend career training programs at schools operated by Corinthian Colleges, Inc. They were misled and mistreated by Corinthian, which held itself out as offering quality vocational training programs that consistently placed graduates in desired jobs.
Named Plaintiffs Martin Calvillo Manriquez, Jamal Cornelius, Rthwan Dobashi, and Jennifer Craig borrowed federal student loans in order to attend career training programs at schools operated by Corinthian Colleges, Inc. They were misled and mistreated by Corinthian, which held itself out as offering quality vocational training programs that consistently placed graduates in desired jobs.
Motion for Preliminary Injunction
Plaintiffs request that this Court issue a preliminary injunction pursuant to Fed. R. Civ. P. 65, ordering the Department of Education ("Department"): to cease all efforts to collect outstanding federal student loan debt from Plaintiffs, to ensure the removal of negative credit reporting on Plaintiffs' outstanding federal student loan debt,
Ex-Corinthian Students Look To Bar Fed Loan Collections | Law360
The U.S. Department of Education flouted federal law on agency rulemaking and violated the Privacy Act when it suddenly changed its student loan forgiveness policy, a putative class of former students of the now-defunct Corinthian College told a California federal judge Monday, arguing that without a temporary bar on the new policy, they’d be forced to choose between life necessities and loan defaults.
Hearing Could Determine Fate of Corinthian College Student Loan Debt | CBS Los Angeles
Thousands of ex-Corinthian Colleges students are anxiously awaiting the outcome of a Monday court hearing that could determine whether they still have to pay the loans they took out to attend the now-closed, for-profit colleges.
Feds Push to Collect From Defrauded Corinthian Students | Courthouse News Service
A Justice Department lawyer on Monday defended cutting loan debt relief for some 100,000 students defrauded by Corinthian Colleges, arguing the Department of Education never promised to wipe out all of their debt.
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