A federal judge blocked the Trump administration Tuesday from enforcing a rule that would have stripped public service workers of student loan forgiveness based on their employers' stated purposes, handing the White House another courtroom loss on education policy.
U.S. District Judge Myong Joun in Boston ruled against the Department of Education's October regulation, which would have redefined eligibility for the Public Service Loan Forgiveness Program by excluding organizations deemed to have a "substantial illegal purpose."
The administration's definition cast a wide net. It targeted groups supporting immigration rights, transgender healthcare, diversity programs, and political protest, framing them as organizations engaged in illegal immigration, terrorism, illegal discrimination, or what it termed "chemical and surgical castration or mutilation of children" when describing gender-affirming medical care for minors.
The rule stemmed from a March 2025 executive order in which Trump claimed the forgiveness program had "misdirected tax dollars into activist organizations that not only fail to serve the public interest, but actually harm our national security and American values." He directed the education department to rewrite the rules governing who qualifies for the benefit.
Democratic-led states, cities, and nonprofits challenged the regulation in November before it could take effect July 1. Their lawsuit argued the education department lacked legal authority to create such exceptions and that the policy had no rational basis beyond targeting disfavored causes.
The Public Service Loan Forgiveness Program allows borrowers to have their federal student loans erased after 10 years of work for government or nonprofit employers. Since Congress created the program in 2007, more than a million borrowers have received debt relief.
Judge Joun's decision marked the second judicial rebuke to the administration's student loan overhaul in one week. On Wednesday, another federal judge in Washington blocked the education department from implementing a separate rule that would have imposed lower borrowing caps for graduate students pursuing degrees in nursing and other health professions.
Author James Rodriguez: "The administration's attempt to weaponize a debt relief program against groups it dislikes was always vulnerable to legal challenge, and courts are making clear that executive power has limits when Congress has already written the rules."
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