Missouri Government Agency Threatening to Sue Critic for Libel
The Washington Post (Danielle Douglas-Gabriel) covers the story, in an article titled “Student loan servicer MOHELA tells advocacy group to stop ‘misleading claims.'” The article links to MOHELA’s demand letter, which closes with,
This letter provides the SBPC [the Student Borrower Protection Center] with notice of the falsity of the above-described statements and insinuations. Consequently, if the SBPC continues to make and publish any of these false and misleading statements, MOHELA will treat that continuation as done with knowledge of the statements’ falsity or with reckless disregard of their truth or falsity, which can lead to punitive damages under libel laws and other related laws. MOHELA is hopeful that you understand that MOHELA will take all appropriate action necessary to stop this conduct if you persist. MOHELA greatly values and aggressively protects its rights and reputation and intends to vigorously enforce its rights.
But MOHELA is a government entity, and government entities cannot sue for libel, regardless of whether they can show knowing or reckless falsehood.
[1.] First, in Biden v. Nebraska (2023), the Court recognized that MOHELA is a government entity; there, it did so for the purpose of deciding whether a harm to MOHELA is a harm to the state, but the logic extends equally to other constitutional contexts. To quote the Court,
MOHELA is a “public instrumentality” of the State. Mo. Rev. Stat. § 173.360. Missouri established the Authority to perform the “essential public function” of helping Missourians access student loans needed to pay for college. To fulfill this public purpose, the Authority is empowered by the State to invest in or finance student loans, including by issuing bonds. §§ 173.385(1)(6)-(7). It may also service loans and collect “reasonable fees” for doing so. §§ 173.385(1)(12), (18). Its profits help fund education in Missouri: MOHELA has provided $230 million for development projects at Missouri colleges and universities and almost $300 million in grants and scholarships for Missouri students.
The Authority is subject to the State’s supervision and control. Its board consists of two state officials and five m
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