Tuesday, August 15, 2017

The Unfortunate Case of Mark Tetzlaff, a law school graduate with more than a quarter million dollars in student loans. Bankruptcy is the only reasonable option.

One would have to have a stone-cold heart (or no heart at all) not to feel some sympathy for Mark Tetzlaff.  Tetzlaff obtained a law degree from Florida Coastal School of Law in 2005, but so far at least, he has been unable to pass a bar exam.

In 2012, Tetzlaff filed an adversary proceeding in a Wisconsin bankruptcy court, seeking to discharge more than a quarter of a million dollars in student loans.  Tetzlaff had actually paid off his law-school debt but he had incurred $260,000 in student loans to pursue various other degrees.

During his adversary proceeding, Tetzlaff tried to explain why he had been unable to find steady employment. "He introduced evidence showing that he is a recovering alcoholic, that he has been convicted of several misdemeanor offenses and that these convictions have hindered his ability to find a job." Tetzlaff v. Educational Credit Management Corporation, 521 B.R. 875, 877-878 (E.D. Wis. 2014), aff'd, 794 F.3d 756 (7th Cir. 2015). He also introduced evidence from a psychiatrist that he suffered from narcissistic personality disorder, anxiety and depression.

In addition, Tetzlaff attempted to introduce testimony from a forensic psychologist that he had serious memory problems that prevented him from passing the bar. He also had a vocational counselor lined up to testify that his memory problems were serious enough to hinder him from finding a well-paying job.

An unsympathetic  bankruptcy judge refused to allow Tetzlaff's forensic psychologist and vocational counselor to testify because Tetzlaff he had not disclosed these witnesses by the deadline established in the court's pretrial order. But the judge allowed Educational Credit Management Corporation, Tetzlaff's student-loan creditor, to introduce its own forensic psychologist to testify.

ECMC's psychologist tested Tetzlaff to determine whether he was feigning his psychological symptoms. Not surprisingly ECMC's hired gun concluded that Tetzlaff was a malingerer and that he was feigning his symptoms.

The judge herself concluded that Tetzlaff had not made good faith efforts to find a job and that most of "[Tetzlaff's] energy over the last several years has been directed at making excuses for his failure . . . rather than securing employment." Id. at 880. Accordingly, the judge refused to discharge Tetzlaff's student loans.

Tetzlaff appealed the bankruptcy court's decision to a federal district court, which upheld the bankruptcy judge's decision. And he appealed again to the Seventh Circuit Court of Appeals, which also upheld the bankruptcy judge. And then he sought review by the US Supreme Court, which refused to hear his appeal.

Over the years, Tetzlaff has taken the bar exam at least five times--twice in Illinois and three times in Wisconsin. He failed the exam all five times.  In July 1917, he sued the Illinois Board of Admissions, demanding extra time to take the bar exam along with the right to consult written materials and to take the test in a semi-private room free of distractions.  Tetzlaff claims he is entitled to these "reasonable accommodations" under the Americans with Disabilities Act.

Tetzlaff is now in his late fifties. Twelve years after graduating from law school, he still cannot practice law. Somewhere along his life's journey, he also picked up an MA degree and an MBA; and he is currently pursuing a LLM degree from Temple Law School.

What are we to make of this saga?

First, I believe the bankruptcy court was wrong to deny Tetzlaff a discharge of his student loans. Tetzlaff graduated from a bottom-tier law school, which has very low admission standards. It should not be surprising that he failed the bar exam multiple times. Numerous graduates of Florida Coastal School of Law have failed the bar.  And, as Paul Campos pointed out in his book Don't Go To Law School (Unless), many people who graduate from mediocre law schools will never earn an income that will justify the enormous debt load they take on to get their JD degrees.

Second, I understand why the bankruptcy judge refused to allow a couple of Mr. Tetzlaff's witnesses to testify. Parties to litigation are expected to comply with pretrial orders; and apparently Tetzlaff was granted several extensions to list his expert witnesses before the judge ruled that she would not hear their testimony.

But what kind of justice system do we have that permits a well-heeled creditor like Educational Credit Management Corporation to bring in paid experts to testify that a distressed student-loan debtor is a malingerer? Expert witnesses are hired for one purpose and one purpose only--to help their clients win their cases. ECMC is hounding student debtors in bankruptcy courts all over the United States, and it has almost unlimited resources to hire experts to testify against people who are penniless. Is that fair?

Finally, Mr. Tetzlaff's story illustrates the crazy system of higher education we have constructed in this country that allows an individual to borrow money to obtain multiple degrees when it is clear that this money will never be paid back. Mr. Tetzlaff is a case in point. According to news accounts, he has four academic degrees--a J.D., an MA, an MA, and a BBA--and is pursuing a fifth degree--an LLM.

Let us face facts. Bankruptcy relief is the only sensible option for someone like Mr. Tetzlaff. Even if he eventually passes a bar exam and practices law, it is highly unlikely that he will ever pay back $260,000 in student loans (along with accruing interest).




Mark Tetzlaff (seated on the left) (photo credit Bruce Vielmetti, Milwaukee Journal Sentinel)



References

Mike Brown.  Student Loan Plaintiff Mark Tetzlaff Sues Illinois Board of Admissions to the Bar. Lendedu.com, July 31, 2017.

Tetzlaff v. Educational Credit Management Corporation, 521 B.R. 875, 880 (E.D. Wis. 2014), aff'd, 794 F.3d 756 (7th Cir. 2015).

Tetzlaff v. Educational Credit Management Corporation, 794 F.3d 756 (7th Cir. 2015),  cert. denied, 2016 U.S. LEXIS 61 (U.S. Jan. 11, 2015).

Bruce Vielmetti. Waukesha man sues for double the time, and an open book, to take Illinois bar exam. Milwaukee Journal Sentinel, July 26, 2017.

William Vogeler. Law Graduate Sues for Open-Book Bar Exam. findlaw.com, July 27, 2017.



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