The "Big Beautiful Bill" & Law-School Student Loan Debt

The president has done yet another thing that will have massive effects on legal education. No, this is not about how I must overhaul my Consumer Finance syllabus. Granted, the poor saps who teach Constitutional Law have it worse, but they knew what they signed up for.

If you have not dug into the details of H.R. 1, An Act to Provide for Reconciliation Pursuant to Title II of H. Con. Res. 14, there are some biggies for those who care about how legal education is funded and administered. Known in some circles as the "Big, Beautiful Bill," this law massively overhauls federal student loan programs. Jeff Robledo at USA Today has a good summary of what the changes mean for borrowers generally. For law schools, there is a biggie.

Teaching Trustee Exemption Planning in Bankruptcy

Since I began teaching the bankruptcy survey course, I've added extra material apart from the textbook that I've named "trustee exemption planning." The core of this material is Schwab v. Reilly, 560 U.S. 770 (2010), which I've assigned more or less in its entirety. The case is a useful vehicle to discuss how to claim exemptions, what debtors (and their attorneys) may do if the value of property is unclear, what trustees likewise may do if the value of property is unclear, and how trustees may make money for creditors from an estate. The debtor, Reilly, also has a moving story about opening a restaurant and wanting to keep kitchen equipment that is sentimental to her. I give students her handwritten schedules outlining every piece of equipment she seeks to retain. The case also outlines how a trustee can preserve value for the estate beyond the relevant exemptions.

But the case is getting older. The forms modernization project updated Schedule C to align with its holding. Enter a new case, published about a month ago, In re Collins, Case No. 24-54928, Judge John E. Hoffman, Jr., Bankruptcy Court for the Southern District of Ohio. Bill Rochelle highlighted it for its clarification of what a trustee must do to object to an exemption claiming "100% of FMV." I am posting about the opinion to further highlight it for its usefulness in teaching about exemptions in consumer bankruptcy.

The 23andMe Court Got It Right; Is that Wrong?

The bankruptcy court approved 23andMe's motion to sell its assets in its chapter 11 case. Those assets include the genetic information its customers had entrusted to the company. Understandably, many customers and government regulators had concerns about the deal. In the end, Judge Walsh got it right on the law. 

All that was at issue in the motion before Judge Walsh was whether 23andMe satisfied the requirements to sell assets in bankruptcy. The consumer privacy ombudsman suggested restrictions on the transfer of its customers' genetic information. Those restrictions might serve the common weal, but Judge Walsh had to stick to the law Congress had given him. That law is a textual mess. The intentionalism and purposivism on display in the opinion cuts through the textual problems. There is a lot to the opinion, but for now I will just focus on the section 363 issue.