Class Action Over Discharged Student Loan Debt Nixed by 5th Cir.

Oct. 22, 2019, 1:50 PM

A suit by debtors to certify a nationwide class action to enjoin collection of student loan debt validly discharged in bankruptcy was dashed by the Fifth Circuit.

A class action is inappropriate because bankruptcy courts don’t have authority to enforce the discharge injunctions entered in other districts, the opinion by Judge Leslie H. Southwick said.

Although the Bankruptcy Code and Rules previously suggested enforcement of a discharge injunction was permissible in a new district, that language has been removed, the court said.

The bankruptcy court in which the enforcement request here was filed said a discharge injunction from another district ...

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