Deadline Draws Near for Compliance with U.S. Department of Education’s 2016 Borrower Defense to Repayment (BDR) Rule

The deadline for complying with certain provisions of the U.S. Department of Education’s borrower defense regulations is Tuesday, May 14. These requirements are summarized briefly below and in greater detail in our March 21, 2019, Alert and April 9, 2019, Alert.

Arbitration Agreements and Class Action Waivers

Starting Tuesday, May 14, schools must either stop using binding predispute arbitration agreements and class action waivers or include the language from the regulation removing borrower defense claims from the scope of these agreements. In addition, starting May 14, students who previously signed a binding predispute arbitration agreement must be provided with specified notice language no later than upon exit counseling or the filing of the school’s initial response to a demand for arbitration or service of a complaint involving a borrower defense claim.

To read the full text of this Alert, please visit the Duane Morris website.