Subject-matter jurisdiction; Standing; Suspension of student loan repayments & interest freeze during the COVID-19 pandemic; Creation of a 12-month “on-ramp to repayment”; An “injury in fact”; Theory of “direct economic injury”; Theory of “competitor standing”; Public Service Loan Forgiveness (PSLF)

[This appeal was from the ED-MI.] The court held that plaintiff-Mackinac Center for Public Policy lacked standing to challenge defendant-Department of Education’s authority to implement its repayment-and interest suspensions and on-ramp to repayment programs for student borrowers. Plaintiff failed to clearly allege that it had suffered an “injury in fact.” During the COVID-19 pandemic the Department “suspended student-loan payments and froze interest for all borrowers.” It also later instituted a 12-month “on-ramp to repayment running from” 10/1/23 to 9/30/24. The dispositive issue here was whether the complaint clearly alleged facts showing that plaintiff suffered an injury in fact arising from the Department’s actions. “An injury in fact ‘must affect the plaintiff in a personal and individual way and not be a generalized grievance.’” Plaintiff is a nonprofit, tax-exempt organization that qualifies as a public service employer under the PSLF program created by Congress in 2007. It argued that it suffered the required injury under the theory of direct economic injury because the Department “‘economically harmed PSLF employers by lowering their statutorily prescribed wage subsidy’” and making borrowers less likely to take advantage of forgiveness under the PSLF. But the court found that the complaint fell “short of pleading an economic injury because it offers legal conclusions disguised as facts.” Plaintiff did not allege that any of its employees stopped making payments during the suspensions or partial or late payments during the on-ramp. It also failed to show that the Department’s “actions affected its ability to recruit employees or fill vacancies. In other words,” it did not “point to any money it lost” due to the Department’s actions. Thus, it “failed to establish the ‘much more’ that is needed to show a direct injury resulting from the Department of Education’s actions regulating student-loan borrowers, not public service employers.” Next, under “the competitor-standing doctrine, economic actors suffer an injury in fact ‘when agencies lift regulatory restrictions on their competitors or otherwise allow increased competition against them.’” The court concluded plaintiff did not clearly allege “facts showing that the suspensions or on-ramp directly increased competition.” Its allegations as to “supply and demand and the impact of financial incentives on student loan borrowers—nonparties to this action—are speculative.”