A Milbank LLP pro bono team secured a favorable settlement for a US Army veteran struggling with financial and familial burdens, successfully obtaining the discharge of his substantial student loan debt.
The firm’s client is the primary caregiver for his nine-year-old daughter who suffers from trisomy-13, a severe genetic disorder. Due to the round-the-clock required care for his daughter and his more than $160,000 of student loan debt, he has struggled to find sustainable employment, making it even more difficult to repay his student loan debt. In October 2019, he filed a voluntary petition for relief under chapter 7 of the Bankruptcy Code in the Bankruptcy Court for the Southern District of New York. Although his non-student-loan debts were discharged in February 2020, his student loan debt was not discharged and continued to grow due to interest.
Milbank was engaged in 2021 to assist him in his pursuit to have the student loan debt discharged. In June 2021, the court granted the Milbank team’s motion to reopen the case, allowing for the commencement of an adversary proceeding to discharge the student loans. The Milbank team compiled a thorough, compelling and, ultimately, convincing case for the discharge of nearly all of the client’s student loan debt on the basis that repaying those loans would cause him and his daughter an undue hardship. The Department of Education agreed to settle his student loan debt. Under the settlement arrangement, he will pay $3,100 and the remaining approximately $160,000 will be discharged.
“This collaboration between our Financial Restructuring lawyers and our Litigation team resulted in a hard-earned, favorable outcome,” said Milbank Financial Restructuring partner Dennis Dunne. “Our client is thrilled, and we are grateful for the opportunity to help him and his daughter in this vital matter.”
The Milbank team was led by partner Dennis Dunne and included Financial Restructuring associates C.J. Haynes, Kathrine Gutierrez and Edward Linden, Litigation & Arbitration special counsel Matthew Laroche, and Litigation & Arbitration associates Jamie Bircoll and Lauren Knoke.
