Navient Files Motion for Summary Judgment in CFPB Case

Citing lack of facts from the bureau in the lawsuit initiated in 2017, Navient seeks conclusion of the case.

5/20/2020 5:00 PM

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Navient Files Motion for Summary Judgment in CFPB Case

Student loan servicer Navient filed a summary judgment May 19 seeking an end to a lawsuit, without a trial, from the Consumer Financial Protection Bureau on the grounds the bureau lacks evidence to support its claims the company provided misleading information to borrowers.

In the lawsuit, filed in 2017 in the U.S. District Court for the Middle District of Pennsylvania,  the CFPB alleges “unlawful acts and practices in connection with defendants’ servicing and collection of [federal and private] student loans.” The CFPB sought permanent injunctive relief, restitution, refunds, damages, civil money penalties, and other relief for the alleged violations, ACA International previously reported.

According to The Washington Post, the CFPB also filed a motion for summary judgment May 19.  

“After a more than three-year court process, after making grand headline-grabbing allegations, after spending days and days deposing Navient borrowers, current and former employees, and after receiving more than a million documents and terabytes of data, the CFPB lacks the evidence to support its claims. There are even several claims where the CFPB never even attempted to produce the evidence they committed to providing,” Mark Heleen, Navient’s general counsel, said in a statement issued to ACA.

According to the original complaint from the CFPB, Navient allegedly did not help student loan borrowers find the correct loan repayment option for their circumstances or provide information about renewal deadlines for borrowers who did enroll in long-term repayment plans. The CFPB asserted in the complaint that Navient’s compensation policies were based, in part, on average call time. Therefore, the CFPB claimed that Navient’s employees were incentivized to steer borrowers into forbearance rather than income-driven repayment plans because conversations about such repayment plans were too time consuming.  

Navient responded that the CFPB has not produced a single borrower, policy or practice that supports this allegation.

“Every borrower the CFPB identified to try to support its steering claims repeatedly received information about income-driven repayment plans, including before and immediately after enrolling in forbearance,” Heleen continued in his statement.

“When all evidence – not just cherry-picked, isolated items – is evaluated, there is simply nothing to the CFPB’s claims. At the end of the day, nothing they say detracts from the fact that Navient supports the investments students make in their higher education by assisting them in successfully repaying their student loans, and we have helped increase enrollment in affordable payment plans, such as income-driven repayment plans, to record highs.”

Navient previously filed for a motion for partial summary judgment in the lawsuit.

Its new motion, Navient states, “Six and a half years have passed since the Consumer Financial Protection Bureau (“CFPB”) began its investigation into Defendants. In those years, the CFPB engaged in extensive discovery, resulting in four discovery extensions and requiring a Court-appointed Special Master to manage a considerable number of discovery disputes. Through all this, a central focus of Defendants’ discovery has been to determine what, if any, factual support the CFPB had developed to back up the allegations in its Complaint. That discovery has shown that the CFPB still has no evidence to support essential elements of its claims.”

ACA will continue to follow the status of this lawsuit. It could be 90 days or more before the judge rules on either motion.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

Navient Files Motion for Summary Judgment in CFPB Case

Student loan servicer Navient filed a summary judgment May 19 seeking an end to a lawsuit, without a trial, from the Consumer Financial Protection Bureau on the grounds the bureau lacks evidence to support its claims the company provided misleading information to borrowers.

In the lawsuit, filed in 2017 in the U.S. District Court for the Middle District of Pennsylvania,  the CFPB alleges “unlawful acts and practices in connection with defendants’ servicing and collection of [federal and private] student loans.” The CFPB sought permanent injunctive relief, restitution, refunds, damages, civil money penalties, and other relief for the alleged violations, ACA International previously reported.

According to The Washington Post, the CFPB also filed a motion for summary judgment May 19.  

“After a more than three-year court process, after making grand headline-grabbing allegations, after spending days and days deposing Navient borrowers, current and former employees, and after receiving more than a million documents and terabytes of data, the CFPB lacks the evidence to support its claims. There are even several claims where the CFPB never even attempted to produce the evidence they committed to providing,” Mark Heleen, Navient’s general counsel, said in a statement issued to ACA.

According to the original complaint from the CFPB, Navient allegedly did not help student loan borrowers find the correct loan repayment option for their circumstances or provide information about renewal deadlines for borrowers who did enroll in long-term repayment plans. The CFPB asserted in the complaint that Navient’s compensation policies were based, in part, on average call time. Therefore, the CFPB claimed that Navient’s employees were incentivized to steer borrowers into forbearance rather than income-driven repayment plans because conversations about such repayment plans were too time consuming.  

Navient responded that the CFPB has not produced a single borrower, policy or practice that supports this allegation.

“Every borrower the CFPB identified to try to support its steering claims repeatedly received information about income-driven repayment plans, including before and immediately after enrolling in forbearance,” Heleen continued in his statement.

“When all evidence – not just cherry-picked, isolated items – is evaluated, there is simply nothing to the CFPB’s claims. At the end of the day, nothing they say detracts from the fact that Navient supports the investments students make in their higher education by assisting them in successfully repaying their student loans, and we have helped increase enrollment in affordable payment plans, such as income-driven repayment plans, to record highs.”

Navient previously filed for a motion for partial summary judgment in the lawsuit.

Its new motion, Navient states, “Six and a half years have passed since the Consumer Financial Protection Bureau (“CFPB”) began its investigation into Defendants. In those years, the CFPB engaged in extensive discovery, resulting in four discovery extensions and requiring a Court-appointed Special Master to manage a considerable number of discovery disputes. Through all this, a central focus of Defendants’ discovery has been to determine what, if any, factual support the CFPB had developed to back up the allegations in its Complaint. That discovery has shown that the CFPB still has no evidence to support essential elements of its claims.”

ACA will continue to follow the status of this lawsuit. It could be 90 days or more before the judge rules on either motion.


Follow ACA International on Twitter @ACAIntl and @acacollector, Facebook and request to join our LinkedIn group for news and event updates. ACA International members are welcome to submit news items for possible publication to comm@acainternational.org. Visit our publications page for news submission guidelines and subscriptions to ACA Daily, Collector magazine and Pulse.

Advertising is available for companies wishing to promote their products or services. Be sure to visit the ACA Events Calendar on the Education and Training page to view our listing of upcoming CORE Curriculum and Hot Topic seminars featuring critical educational opportunities for your company.


Subscribe to ACA Daily NEWSROOM

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