State of Nebraska v. Joseph Biden, Jr., 52 F.4th 1044

Plaintiff States challenged the Secretary of Education’s plan to cancel student loan debt under the HEROES Act and sought a preliminary injunction against implementation.
The district court denied the injunction and dismissed for lack of Article III standing; the States appealed and moved for an injunction pending appeal.
Central to standing is the Missouri Higher Education Loan Authority (MOHELA), a state-created loan servicer that statutorily must remit $350 million to a State treasury fund and had $105.1 million still unfunded as of June 30, 2022.
Plaintiffs argued the Secretary’s nationwide debt-discharge plan would reduce MOHELA’s revenues, threaten the Lewis and Clark Discovery (LCD) Fund, and consequently injure Missouri’s ability to fund higher-education capital projects.
The Eighth Circuit concluded Missouri likely has standing (via MOHELA’s statutory obligations) and that the balance of equities favors an injunction pending appeal because the Secretary’s action would be irreversible while an injunction would impose little current harm (payments and interest already suspended).
The court granted the emergency injunction pending appeal and declined to narrow its scope at this stage, citing MOHELA’s nationwide servicing role and the universal suspension of loan payments and interest.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Article III standing (Missouri)	MOHELA’s revenue loss from cancellation will reduce remittances to the LCD Fund and injure Missouri	MOHELA is independent; any MOHELA loss is not state injury	Missouri likely has standing because MOHELA’s statutory obligation ties MOHELA’s finances to the State, making injury traceable and redressable
Status of MOHELA as an "arm of the state"	MOHELA’s creation, governance, and statutory duties make it an arm of Missouri	MOHELA is not clearly an arm; courts are divided	Court did not definitively decide arm-of-state but noted precedent supports that characterization and found standing even if not an arm due to statutory obligations
Merits: Secretary’s authority under HEROES Act / APA challenge	States raise substantial legal questions (separation of powers; exceed authority; arbitrary and capricious)	Secretary asserts authority and argues injunction is unnecessary given suspended payments	Court held plaintiffs raised substantial questions and that the equities and likelihood of irreparable harm favor an injunction pending appeal
Scope of preliminary relief	Plaintiffs seek relief preventing the plan’s implementation as to affected States	Secretary urged limiting relief to plaintiff States or specific loans	Court declined to narrow relief at this emergency stage—practical limits and MOHELA’s nationwide role make tailored relief unworkable; injunction granted pending appeal

Walker v. Lockhart, 678 F.2d 68 (8th Cir. 1982) (standard for injunction pending appeal mirrors preliminary injunction inquiry)
Dataphase Sys., Inc. v. C L Sys., Inc., 640 F.2d 109 (8th Cir. 1981) (en banc) (balancing equities in preliminary injunction analysis)
Glenwood Bridge, Inc. v. City of Minneapolis, 940 F.2d 367 (8th Cir. 1991) (preserve status quo pending appeal inquiry)
Pub. Sch. Ret. Sys. of Mo. v. St. Bank & Trust Co., 640 F.3d 821 (8th Cir. 2011) (framework for determining when an entity is an arm of the state)
Dep’t of Commerce v. New York, 139 S. Ct. 2551 (2019) (standing/injury principles)
Madsen v. Women’s Health Ctr., Inc., 512 U.S. 753 (1994) (scope of equitable relief must not be more burdensome than necessary)
Califano v. Yamasaki, 442 U.S. 682 (1979) (injunctive relief scope dictated by extent of violation)
North Carolina v. Covington, 137 S. Ct. 1624 (2017) (equitable relief must be workable and tailored to the violation)
Rodgers v. Bryant, 942 F.3d 451 (8th Cir. 2019) (discussing limits on scope of injunctions and class/geographic considerations)