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JOHNSON v. UNITED STATES DEPARTMENT OF EDUCATION

September 13, 2005.

ADRIENNE JOHNSON, Plaintiff,
v.
UNITED STATES DEPARTMENT OF EDUCATION, Defendant.



The opinion of the court was delivered by: GARY LANCASTER, District Judge

MEMORANDUM

Plaintiff, Adrienne Johnson, seeks judicial review of an administrative decision, made by defendant, United States Department of Education, that Johnson's student loan debts may be collected through administrative wage garnishment. Before the court is defendant's motion for summary judgment and motion to dismiss [doc. no. 3]. Defendant argues that it is entitled to summary judgment because the agency decision was in accordance with the law and was not arbitrary and capricious. Defendant also argues that plaintiff has failed to state a claim for three new claims that plaintiff did not raise before the administrative agency.

For the reasons set forth below, defendant's motions will be granted. I. BACKGROUND

  Unless otherwise indicated, the following facts are undisputed. Between 1978 and 1980, while attending Cornell University, plaintiff signed several applications and promissory notes for student loans totaling $12,860.00. See Administrative Record ("AR") at 0000030-0000032; Complaint ¶¶ 5&6. Plaintiff admits to making timely repayments until August 1983 when she ran into financial difficulties. Complaint ¶ 7. Plaintiff claims to have unsuccessfully worked with defendant in an attempt to compromise on the amount owed. In 1992 she told the agency to sue her "so there could be a fair and competent determination of what collection costs should be considered necessary and reasonable." Id. at ¶ 9. In 1995, the guaranty agency transferred its loans to defendant. Id. at ¶ 10. At that time, the principal balance was $12,851.90. Id. Upon receipt of defendant's Notice of Proposed Wage Garnishment, plaintiff made a timely Request for Hearing.

  At her agency hearing, plaintiff objected to the garnishment of her wages because (a) she did not borrow the total amount claimed; (b) the debt is not an enforceable debt; and (c) withholding 15 percent of plaintiff's disposable pay would cause a financial hardship. AR at 000002-000003. Defendant determined that plaintiff's debt was legitimate and legally enforceable, and that according to their records, plaintiff owed $12,851.90 in principal, accrued interest of $7,823.58, and unpaid collection costs or fees of $5,168.87, for a total of $25,844.35. Id. at 000003.

  II. STANDARD OF REVIEW

  A. Legal Standard for Summary Judgment

  Fed.R.Civ.P. 56 (c) provides that summary judgment may be granted if, drawing all inferences in favor of the non-moving party, "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."

  The mere existence of some factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment. A dispute over those facts that might affect the outcome of the suit under the governing substantive law, i.e. the material facts, however, will preclude the entry of summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). Similarly, summary judgment is improper so long as the dispute over the material facts is genuine. Id. In determining whether the dispute is genuine, the court's function is not to weigh the evidence or to determine the truth of the matter, but only to determine whether the evidence of record is such that a reasonable jury could return a verdict for the nonmoving party. Id. at 248-49.

  In summary, the inquiry under a Rule 56 motion is whether the evidence of record presents a genuine dispute over material facts so as to require submission of the matter to a jury for resolution of that factual dispute or whether the evidence is so one-sided that the movant must prevail as a matter of law.

  B. The Scope of Judicial Review of an Agency Decision

  Here, the court must view the Rule 56 summary judgment standard in conjunction with the appropriate scope of judicial review of an administrative agency. "A district court's review of an administrative decision is usually limited to determining whether the agency action is arbitrary, capricious, an abuse of discretion, or otherwise not in accord with law." United States v. Bean, 537 U.S. 71, 77 (2002) (quoting 5 U.S.C. § 706(2)(A)). This standard "presumes that agency decisions are valid as long as the decision is supported by a rational basis." Pozzie v. United States Dep't of Hous. and Urban Dev., 48 F.3d 1026, 1029 (7th Cir. 1995); Gorka v. United Stated Dep't of Educ., No. 02 C 5449, 2004 WL 2658071 *3 (N.D. Ill. Oct. 13, 2004). "Courts reviewing administrative decisions are only to determine whether the decision was based on `relevant factors,' and whether the agency made a `clear error in judgment.'" Gorka, 2004 WL 2658071 at *3 (quoting Pozzie, 48 F.3d at 1029). The district court is not permitted to substitute its judgment for that of the agency. Bowman Transp., Inc. v. Arkansas Best Freight Sys., Inc., 419 U.S. 281, 285 (1974). Thus, a district court may only set aside an agency decision if the decision falls outside the scope of the agency's lawful authority, or is not "logical and rational." Allentown Mack Sales & Serv. v. NLRB, 522 U.S. 359, 374 (1998).

  III. DISCUSSION

  A. Defendant's Motion for Summary Judgment on the ...


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