A federal judge on Tuesday dismissed a lawsuit against the U.S. Department of Education by four student loan debt collection companies that claim the department arbitrarily cut ties with them earlier this year.
The decision by U.S. Court of Federal Claims Judge Francis Allegra is a victory for the Education Department, which effectively fired five debt collection companies in February after accusing them of misleading struggling borrowers.
Four of those five companies -- Coast Professional, National Recoveries, Enterprise Recovery Systems and Pioneer Credit Recovery, which is owned by Navient -- were part of the consolidated lawsuit that was dismissed Tuesday.
Judge Allegra's decision in the case was sealed. But it comes after he heard arguments only about whether the companies had made the type of complaint he was empowered to decide in the first place.
Read more at Inside Higher Ed: https://www.insidehighered.com/news/2015/04/15/federal-judge-sides-education-department-firing-debt-collectors