ITT Student Files New Lawsuit Against Navient for Private Student Debt Cancellation | Press Release

September 10, 2020

Even after the Department of Education deemed Jorge Villalba’s federal student loans invalid and cancelled them due to ITT’s fraud, Navient not only continues to collect on his private loans, the lender misled him about the existence of a path to private debt cancellation


BOSTON – In a lawsuit filed today against Navient, Jorge Villalba, a former ITT student, and his mother, Alicia Villalba, demand that their fraudulent private student loans be declared invalid and canceled. The government previously discharged Jorge Villalba’s federal loans through the borrower defense to repayment process, yet when presented with the federal government’s determination that his ITT private loans were also invalid, Navient not only refused to cancel his private loans, it further misled him about the possibility of private debt cancellation.

The lawsuit, Villalba v. Navient, was filed in Los Angeles at the Stanley Mosk courthouse today by the Project on Predatory Student Lending and Jeremy S. Golden, of Golden and Cardona-Loya LLP, on behalf of Jorge Villalba and his mother Alicia Villalba, who is a co-signer on the student loans.

Jorge Villalba has been fighting ITT and the debt it created for years. In 2017, he was one of a small number of ITT students to have his borrower defense granted and his federal loan discharged. He is also one of the named plaintiffs in the ITT bankruptcy case, which in 2019 helped cancel over $500 million of student debts owed to ITT. Yet, he and his mother continue to struggle with more than $69,000 in private student loans for a bogus education.

“Regardless of the type of loan, it was still fraud,” said Mr. Villalba. “Everything about ITT was a lie. And those lies didn’t just affect me, it has affected my entire family. Even with the federal loans cancelled, my credit has been severely negatively impacted. My mom is getting harassed by debt collectors threatening to garnish her wages and close her bank account. This lawsuit is the only way I can do something about it, for my mom and hopefully for countless others who are in this horrible situation.”

“It was always Jorge’s dream to study and have a career, but with ITT, all the jobs and promises were not real,” said Alicia Villalba. “Jorge is stuck with a degree that he cannot use and he did not receive any benefit by going to ITT, meanwhile, he has to deal with these loans that have affected us all. The credit I worked really hard to get is completely ruined. I cannot even get a credit card of my own, my husband has to have all the finances in his name. It is a lot of stress and worry for the whole family.”

When presented with evidence of ITT’s fraud and the federal debt cancellation, Navient not only rejected Villalba’s efforts to seek private loan cancellation, it denied that he had any right to seek cancellation of his loan based on ITT’s fraud – even though the right to seek that process is stated in the student loan contract. It has also continued to aggressively collect on the Villalbas’ loans.

“Jorge’s experience underscores the never-ending battle that defrauded student borrowers face in order to get relief and have their legal rights recognized,” said Victoria Roytenberg, Senior Attorney for the Project on Predatory Student Lending. “Until students can be free of ALL the debts created by predatory schools – whether federal or private loans – we will keep fighting to ensure that borrowers like Jorge and Alicia receive justice.”



Navient (previously Sallie Mae) has benefitted and profited from the predatory for-profit college system for decades, making subprime private student loans to hundreds of thousands of students like Jorge Villalba and his mother. These private loan companies were an integral part of a broader system that scammed students and left them in debt they could not repay. For-profit colleges relied on private lenders for their schemes, using them to meet the minimum 10% of revenue required to come from funding outside of federal loans. ITT was one of the most notorious offenders.

Jorge Villalba attended ITT in 2006. When he visited the campus, he was told about impressive job placement rates and that big companies were in constant contact with the school looking for students and that they would help him get his dream job. The reality was the complete opposite. In fact, Jorge was once told in an interview after graduating with a degree from ITT that the company would not hire anyone from ITT because the students from that school were not capable of doing the minimum job requirements. By that point, ITT had taken over $50,000 in federal student loans and over $43,000 in private student loans from Jorge, with his mother co-signing some of the private loans.

In 2016, the Department of Education cut off federal student aid to ITT. Because almost all of ITT’s revenue came from federal student aid, it declared bankruptcy weeks later. Multiple lawsuits and investigations confirmed ITT’s pervasive fraud.

In 2017, Jorge’s federal student loans were cancelled as a result of the school’s misconduct through the borrower defense to repayment process.

When Jorge told Navient that the Department of Education had acknowledged his loans were invalid due to ITT’s fraud and cancelled his federal loans, Navient refused to follow suit. Navient not only rejected Jorge’s efforts to seek private loan cancellation, it denied that he had any right to seek cancellation of his loans based on ITT’s fraud – even though the right to seek that process is stated in the student loan contract. It misled and deceived Jorge about the possibility of private loan cancellation and the existence of any process to obtain it.

Jorge was also one of the named plaintiffs in the ITT bankruptcy case Villalba et al vs. ITT, which resulted in a settlement between the student class and the estate of ITT. The settlement cancelled $500 million in student debt supposedly owed to ITT, returned $3 million collected since the bankruptcy to former students, and gave students a $1.5 billion allowed claim against the bankruptcy estate. The bankruptcy case is ongoing.

Despite extensive evidence of illegal behavior, the Department of Education, as well as private lenders like Navient, continue to collect on the student loans that funded ITT’s fraud. These loans are clearly invalid and must be cancelled.


About the Project on Predatory Student Lending

Established in 2012, the Project on Predatory Student Lending of the Legal Services Center of Harvard Law School represents former students of the predatory for-profit college industry. Its mission is to litigate to make it legally and financially impossible for the for-profit college industry to cheat students, and to relieve borrowers from fraudulent student loan debt. The Project has brought a wide variety of cases on behalf of former students of for-profit colleges. It has sued the federal Department of Education for its failures to meet its legal obligation to police this industry and stop the perpetration and collection of fraudulent student loan debt.


About Golden and Cardona-Loya LLP

Golden & Cardona-Loya, LLP is a consumer rights law firm founded in 2009 and based in Southern California.  Partner Jeremy S. Golden, an attorney since 2003, has dedicated his practice to representing individuals who have had their rights violated by banks, finance companies, credit bureaus and student loan servicers.  Mr. Golden has extensive experience in representing former students against student loan servicers that have engaged in unlawful debt collection or attempted collection on fraudulent student loans.  He has obtained over a million dollars in savings to student loan borrowers by obtaining loan forgiveness or defending them in collection cases.