United States of America v. Jackson
ORDER granting 7 plaintiff's Motion for Summary Judgment (and plaintiff is ordered to show cause within 21 days to prove amount) Signed by District Judge George Caram Steeh. (MBea)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
UNITED STATES OF AMERICA,
Case No. 17-10131
HON. GEORGE CARAM STEEH
ORDER GRANTING PLAINTIFF’S MOTION
FOR SUMMARY JUDGMENT (DOC. 7)
Plaintiff, the United States of America, alleges that defendant,
Maurice Jackson, failed to pay off his student loan. Plaintiff seeks to
recover defendant’s debt. The matter is presently before the Court on
plaintiff’s motion for summary judgment. (Doc. 7). The motion was
determined without oral argument pursuant to E.D. Mich. LR 7.1(f)(2). For
the reasons stated below, plaintiff’s motion for summary judgment is
On January 4, 1998, defendant signed a promissory note to secure a
federally guaranteed student loan from The Chase Manhattan Bank. (Doc.
7-2 at PageID 24; 7-3 at PageID 26). The promissory note was issued
pursuant to loan guaranty programs authorized under Title VI-B of the
Higher Education Act of 1965, as amended, 20 U.S.C. § 1071 et seq. (34
C.F.R. § 682). (Doc. 7-3 at PageID 26). The promissory note lists
defendant’s school as NEC/NIT. (Doc. 7-2 at PageID 24). NEC appears to
refer to the National Education Center, while NIT refers to the National
Institute of Tech Campus. (Doc. 10 at PageID 32). It is not clear when
defendant enrolled at NEC. The promissory note lists an anticipated
graduation date of October 6, 1989. (Doc. 7-2 at PageID 24). But,
defendant left NEC after only three months without completing his program.
Defendant defaulted on his obligation to pay on February 7, 1989.
(Doc. 7-3 at PageID 26). The promissory note holder filed a claim with the
Guarantor, who paid the claim, and was reimbursed by the United States
Department of Education. (Doc. 7-3 at PageID 26). The Department of
Education was thereafter assigned right and title to the loan. (Doc. 7-3 at
PageID 26). Now it seeks to collect payment from defendant. (Doc. 7-3 at
PageID 26). A Certificate of Indebtedness from the Department of
Education, dated January 22, 1998, reflects that as of that date, defendant
is indebted to the United States in the amount of $1,721.24. (Doc. 7-3 at
PageID 26). This figure is based on a principal balance of $1,156.66,
$524.58 in interest, and $40.00 in administrative or collection costs. (Doc.
7-3 at PageID 26). Interest accrues at an annual rate of 8%. (Doc. 7-3 at
PageID 26). Christopher Bolander, a Department of Education loan analyst
states that the certificate of indebtedness is true and accurate. (Doc. 7-4 at
II. Legal Standard
Rule 56(c) empowers a court to render summary judgment “if the
pleadings, depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no genuine issue as to
any material fact and that the moving party is entitled to a judgment as a
matter of law.” Williams v. Mehra, 186 F.3d 685, 689 (6th Cir. 1999) (en
banc) (citing Fed. R. Civ. P. 56(c)).
The standard for determining whether summary judgment is
appropriate is “whether the evidence presents a sufficient disagreement to
require submission to a jury or whether it is so one-sided that one party
must prevail as a matter of law.” Amway Distrib. Benefits Ass’n v.
Northfield Ins. Co., 323 F.3d 386, 390 (6th Cir. 2003) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 251-52 (1986)). The evidence and all
reasonable inferences must be construed in the light most favorable to the
non-moving party. Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp.,
475 U.S. 574, 587 (1986); Redding v. St. Eward, 241 F.3d 530, 532 (6th
Cir. 2001). "[T]he mere existence of some alleged factual dispute between
the parties will not defeat an otherwise properly supported motion for
summary judgment; the requirement is that there be no genuine issue of
material fact." Anderson, 477 U.S. at 247-48 (emphasis in original); see
also Nat’l Satellite Sports, Inc. v. Eliadis, Inc., 253 F.3d 900, 907 (6th Cir.
If the movant establishes by use of the material specified in Rule
56(c) that there is no genuine issue of material fact and that it is entitled to
judgment as a matter of law, the opposing party must come forward with
"specific facts showing that there is a genuine issue for trial." First Nat'l
Bank v. Cities Serv. Co., 391 U.S. 253, 270 (1968); see also McLean v.
988011 Ontario, Ltd., 224 F.3d 797, 800 (6th Cir. 2000). Mere allegations
or denials in the non-movant's pleadings will not meet this burden, nor will
a mere scintilla of evidence supporting the non-moving party. Anderson,
477 U.S. at 248, 252. There must instead be evidence from which a jury
could reasonably find for the non-movant. McLean, 224 F.3d at 800 (citing
Anderson, 477 U.S. at 252).
“To recover on a promissory note the government must first make a
prima facie showing that (1) the defendant signed it, (2) the government is
the present owner or holder and (3) the note is in default.” United States v.
Petroff-Kline, 557 F.3d 285, 290 (6th Cir. 2009) (internal citations omitted).
“For that purpose the government may introduce evidence of the note and
a sworn transcript of the account or certificate of indebtedness.” Id.
(internal citations omitted). “Once such a prima facie case is established,
defendant has the burden of proving the nonexistence, extinguishment or
variance in payment of the obligation.” Id. (internal citations omitted).
Plaintiff submits the promissory note, a certificate of indebtedness,
and an affidavit of a Department of Education loan analysis to establish that
defendant signed the promissory note, the Government is the present
owner or holder, and the note is in default. The Court, therefore, finds that
plaintiff has made a prima facie showing necessary to recover on the
promissory note. As such, defendant bears the burden of proving
nonexistence, extinguishment, or variance in payment.
Defendant raises three arguments to support his request that the
Court forgive or cancel his debt. Preliminarily, however, the Court shall
address what may be an additional argument. Plaintiff’s brief addresses a
statement in defendant’s answer, which, liberally construed, appears to
assert a statute of limitations defense. (Doc. 3 at PageID 8) (stating
disagreement with plaintiff’s complaint because of a “28 year gap”). “The
Higher Education Technical Amendments of 1991 (HETA) eliminated a sixyear statute of limitations for student loan collections in 20 U.S.C. §
1091a(a).” United States v. Brown, 7 F. App'x 353, 354 (6th Cir. 2001).
“Section 1091a(a)(2) now reads, in pertinent part, ‘no limitation shall
terminate the period within which suit may be filed, a judgment may be
enforced, or an offset, garnishment, or other action initiated or taken ... [for]
repayment of the amount due from a borrower on a loan.’” Id. “Other
circuits have specifically held that HETA's retroactive abrogation of the
statute of limitations does not violate a student loan debtor's due process
rights.” Id. (citing United States v. Hodges, 999 F.2d 341, 342 (8th
Cir.1993); United States v. Glockson, 998 F.2d 896, 898 (11th Cir.1993)).
Plaintiff’s claims, therefore, are not barred by a statute of limitations.
Defendant appears to argue the defense of mutual mistake. (Doc. 10
at PageID 31). A mutual mistake of fact is “an erroneous belief, which is
shared and relied on by both parties, about a material fact that affects the
substance of the transaction.” Ford Motor Co. v. City of Woodhaven, 475
Mich. 425, 442 (2006). Defendant’s response to plaintiff’s motion for
summary judgment includes a state court civil answer form and a
personalized letter. (Doc. 10). Defendant only mentions mutual mistake on
the answer form. (Doc. 10 at PageID 31). He checked off a box stating
that he “disagree[s] with the statements in paragraph 1” and, submitting an
answer to explain his disagreement, stated “deny mutual mistake.” (Doc.
10 at PageID 31). Defendant’s letter does not include any mention of a
mutual mistake. (Doc. 10 at PageID 32-33). Nor has defendant offered
any evidence regarding a shared erroneous belief about a material fact
affecting the substance of his student loan. As such, any attempt to defeat
summary judgment on the basis of a mutual mistake fails.
Defendant further argues that the Court deny summary judgment
“pursuant to the local rule for concurrence to file.” (Doc. 10 at PageID 31).
Pursuant to Eastern District of Michigan Local Rule 7.1(a),
(1) The movant must ascertain whether the
contemplated motion, or request under Federal
Rule of Civil Procedure 6(b)(1)(A), will be opposed.
If the movant obtains concurrence, the parties or
other persons involved may make the subject
matter of the contemplated motion or request a
matter of record by stipulated order.
(2) If concurrence is not obtained, the motion or
request must state: (A) there was a conference
between attorneys or unrepresented parties and
other persons entitled to be heard on the motion in
which the movant explained the nature of the
motion or request and its legal basis and requested
but did not obtain concurrence in the relief sought;
(B) despite reasonable efforts specified in the
motion or request, the movant was unable to
conduct a conference; or (C) concurrence in this
motion has not been sought because the movant or
nonmovant is an incarcerated prisoner proceeding
Pursuant to this rule, plaintiff, the party moving for summary judgment,
must merely ask defendant about potential opposition, and report
defendant’s answer to the Court. Plaintiff does not need to obtain
defendant’s concurrence. Plaintiff’s motion states that it “sought
concurrence in this motion by way of correspondence date[d] February 10,
2017, but concurrence was not obtained.” (Doc. 7 at 13). The Court finds
that this statement is sufficient to meet the requirements of Local Rule
7.1(a)(2)(B). As such, defendant’s attempt to defeat summary judgment on
the basis of a failure to seek concurrence fails.
Finally, defendant asks the Court to forgive or cancel his debt “due to
extremely poor instruction and accreditation” at NEC. (Doc. 10 at PageID
32). Defendant asserts a “long dormant provision of the federal student
loan law” stating that “borrowers may seek to have their debts cancelled if
they can prove their school cheated them.” (Doc. 10 at PageID 32).
Defendant’s argument fails for two reasons; he has not shown that such a
provision applies to his student loan debt and he has not shown that
NEC/NIT, also referred to as Everest College, cheated, abused, or misled
A borrower’s defenses depend upon the type of their student loan.
Defendant’s Certificate of Indebtedness states that defendant’s promissory
note was secured “under loan guaranty programs authorized under Title IVB of the Higher Education Act of 1965, as amended, 20 U.S.C. § 1071 et
seq. (34 C.F.R. Part 682).” (Doc. 7-3 at PageID 26). 34 C.F.R. § 682.102
governs repaying a loan. This statute states that:
[g]enerally, the borrower is obligated to repay the
full amount of the loan, late fees, collection costs
chargeable to the borrower, and any interest not
payable by the Secretary. The borrower's obligation
to repay is cancelled if the borrower dies, becomes
totally and permanently disabled, or has that
obligation discharged in bankruptcy. A parent
borrower's obligation to repay a PLUS loan is
cancelled if the student, on whose behalf the parent
borrowed, dies. The borrower's or student's
obligation to repay all or a portion of his or her loan
may be cancelled if the student is unable to
complete his or her program of study because the
school closed or the borrower's or student's
eligibility to borrow was falsely certified by the
school. The obligation to repay all or a portion of a
loan may be forgiven for Stafford Loan borrowers
who enter certain areas of the teaching profession.
34 C.F.R. § 682.102(a). Defendant does not meet any of these
enumerated exceptions. Defendant is not dead, totally and permanently
disabled, or had this obligation discharged in bankruptcy. Defendant is not
a parent borrower. Defendant did not establish, or even argue, that he was
unable to complete his program of study because the school closed.
Defendant voluntarily left NEC/NIT on or about April 1998. NEC/NIT closed
four years later, on January 15, 1992. Defendant did not introduce any
evidence that he intended to return to NEC/NIT and was unable to do so
because of this closure. Defendant also did not establish or even argue
that his eligibility to borrow was falsely certified by the school. Finally,
defendant has not established that he was a Stafford Loan borrower who
entered a certain area of the teaching profession.
Further, defendant has not established that NEC/NIT cheated,
abused, or misled him. Defendant argues that Corinthian Colleges, Inc.
operates numerous schools and online programs under different names,
including NEC, now referred to as Everest College. He alleges that NEC /
Everest used abusive practices to prey on students. Defendant states that
he relied on statements of an NEC recruiter when enrolled at NEC and
sought the promissory note at issue here. The NEC recruiter allegedly
stated that defendant would receive job placement after finishing the
vocational graphic design program. These allegations do not prove abuse.
Defendant voluntarily left NEC/NIT after three months. As such, he did not
complete the vocational graphic design program and was never denied the
represented job placement. Defendant, therefore, cannot prove that the
recruiter’s statements were false, abusive, or misleading.
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For the reasons stated above, plaintiff’s motion for summary
judgment is GRANTED. In the absence of sufficient documentation
establishing the exact amount of defendant’s debt, plaintiff is ORDERED
TO SHOW CAUSE to prove this amount within 21 days from the date of
IT IS SO ORDERED.
Dated: August 3, 2017
s/George Caram Steeh
GEORGE CARAM STEEH
UNITED STATES DISTRICT JUDGE
CERTIFICATE OF SERVICE
Copies of this Order were served upon attorneys of record on
August 3, 2017, by electronic and/or ordinary mail and also on
Maurice Jackson, 29889 Rousseau Drive,
Novi, MI 48377.
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