The American Federation of Teachers (AFT) and nine individual borrowers filed a federal complaint on October 30, 2026 in Washington, D.C., naming U.S. Education Secretary Linda McMahon as a defendant. Union president Randi Weingarten appears as the lead plaintiff in her official capacity, and the case is docketed as 1:26-cv-03826. The suit asks a judge to compel the Department of Education to cancel every loan that satisfies the Public Service Loan Forgiveness (PSLF) requirements, asserting that the agency’s “buyback” process and recent payment-count reductions breach statutory and constitutional duties.
What the complaint alleges
The petition identifies three distinct problems. First, PSLF buyback requests – applications that let borrowers retroactively count months spent in deferment or forbearance toward the 120-payment threshold – are languishing far beyond the statutory 90-day deadline. Second, borrowers whose payment histories were previously credited have seen months removed, effectively pulling them back from the forgiveness finish line. Third, a wave of payments that should have posted in July failed to appear in borrowers’ trackers, denying them the final qualifying month needed for forgiveness.
Borrower stories that illustrate the harm
Ohio nurse Alexander Watts needs 22 months of buyback. The complaint estimates the cost of those months at under $8,400, yet at his current repayment rate of roughly $700 per month the same period would cost about $14,700 – a disparity the lawsuit says is untenable.
Speech-language pathologist Elizabeth Schoepflin reached the 120-payment milestone in April 2026, only to receive an August 4 notice that stripped 14 months from her count. She maintains that neither her repayment plan nor her employer changed during the disputed period, emphasizing, “I kept my end of the deal.”
Chicago psychology professor Carly Baetz had logged 118 qualifying payments by June 2026, but payments from July through October never posted, preventing her from filing the final forgiveness application. Similarly, fellow plaintiff Stephanie Costa cannot submit a buyback request because the unposted months are the ones she needs to complete the count.
Backlog numbers and the Department’s response
Data disclosed in the Department’s court-ordered status reports show the backlog of pending buyback requests surged from 49,318 in April 2025 to 89,720 in March 2026. As of April 30, 2026, the Department reported roughly 88,000 pending cases, acknowledging 18,000-19,000 duplicate entries. That month also marked the first instance where decisions (6,870) outpaced new requests (4,790). Removing duplicates leaves an estimated unique backlog of 69,000-70,000 cases, which, at the April processing rate, would require about ten months; at the January pace of 2,430 decisions, the wait would extend beyond 28 months.
The complaint argues that a buyback decision is a purely ministerial act – the agency merely verifies which months qualify and calculates the monetary value. Yet the filing alleges that many borrowers receive approvals within a few months while others wait years, suggesting an inequitable, out-of-order processing system.
Legal standing rests on the Administrative Procedure Act and the Fifth Amendment’s due-process clause. The plaintiffs seek a court order mandating timely processing, restoration of lost credits, and cancellation of qualifying loans, as well as attorneys’ fees. No monetary damages are requested, and a certified class would automatically include all borrowers who meet the defined criteria.
Legislative backdrop and next steps
Congress is considering a bipartisan bill that would count months spent in the SAVE forbearance program toward PSLF without requiring a buyback, potentially bypassing the contested administrative process. Meanwhile, the Department must answer the complaint, and the plaintiffs must secure class certification before any relief can be extended to the broader borrower pool. Observers will watch for the next backlog report and for the posting of July-October payments that the lawsuit flags as critical.
