Donald Trump listens as Michael Sexton introduces him at a news conference in New York on May 23, 2005, when he announced the establishment of Trump University. (Bebeto Matthews/AP)
A federal judge has given final approval to a $25 million settlement to litigation against Trump University, a now-defunct real estate seminar program once owned by Donald Trump.
Trump had agreed not long after his election to settle two class-action suits filed by former customers of the program in California, as well as a New York state lawsuit. The suits argued that Trump University defrauded customers, some of whom paid more than $30,000 to participate in the seminars, with false advertisements promising that they would learn Trump’s personal real estate tricks and that Trump had hand-picked seminar leaders. In depositions, Trump acknowledged he did not choose instructors.
[Trump agrees to settle Trump University fraud suits]
The case had been used against Trump during the presidential campaign, with Democrats contending that Trump University was part of a pattern of deceptive Trump business endeavors. It also sparked one of the campaign’s most controversial moments for Trump, when he argued that U.S. District Judge Gonzalo Curiel, who was overseeing the matter, was biased because of his Mexican heritage.
The settlement had been endangered after one former student, Sherri Simpson, argued that she should be allowed to opt out of the agreement and continue litigation against Trump. Simpson was particularly distressed that the settlement did not require Trump to admit fault and to apologize for bilking customers. Other former customers who had banded together for the class action wanted the settlement to move forward.
But Curiel ruled Friday that the settlement was “fair” and “adequate.” In a written opinion, Curiel said that many former customers are likely to recover 80 or 90 percent of the amount they had paid for the program, a recovery rate he termed “extraordinary.” The settlement will be available to more than 5,000 former customers of the program, which was held in hotel ballrooms around the country.
[Donald Trump said ‘university’ was all about education. Actually, its goal was: ‘Sell, sell, sell!’]
The ruling provides finality for the Trump University matter. Trump had appeared to be working to settle civil matters before taking office, settling a number of suits that had been pending for years. The Trump University matter was settled a few weeks before a trial in one suit had been scheduled to begin. President Trump would likely have been required to testify in the case.
Still, he continues to face a number of pending legal matters around the country, including a defamation suit in New York state filed by a former contestant on the reality show “The Apprentice,” who alleges that Trump sexually harassed her in 2007 and then defamed her during the campaign by accusing her of making up the story.
The $25 million includes a $1 million penalty paid to New York state for violating the state’s education laws by calling the program a “university” despite offering no degrees or traditional education. In a statement, New York Attorney General Eric Schneiderman, who brought the action, said the settlement would “provide relief — and hopefully much-needed closure — to the victims of Donald Trump’s fraudulent university.”
“Trump University’s victims waited years for compensation, while President Trump refused to settle and fought us every step of the way — until his stunning reversal last fall,” he said. “In particular, I am pleased that we were able to ensure that members of the class-action settlement will receive an even higher settlement than originally anticipated.”