Litigation
Dec. 23, 2016
$25M settlement of Trump University cases receives preliminary approval
Federal judge calls agreement to settle three cases involving the president-elect "fair, adequate, and reasonable"
Daily Journal Staff Writer
A $25 million settlement to resolve three fraud suits against President-elect Donald J. Trump's defunct Trump University has been given preliminary approval by a federal judge. The deal will enable thousands of former Trump University students to recoup at least half, and potentially more, of the funds they spent on the real-estate seminars they attended. Some students paid up to $35,000.
"In light of the multiple risks of continued litigation, the complexity of individualized damages determinations, and the likelihood of delay of any recovery ... the court preliminarily finds that the estimated amount of recovery that eligible class members will receive is fair, adequate, and reasonable," U.S. District Judge Gonzalo P. Curiel wrote in Tuesday's order granting preliminary approval.
Written objections can be filed until early March. Curiel has scheduled a final approval hearing for March 30 in San Diego.
Trump University must pay the $25 million by Jan. 18, two days before Trump is sworn in as president. If Trump University fails to meet the deadline, Trump himself has to pay.
Two of the three cases that the settlement will resolve were litigated in recent years before Curiel in San Diego.
Attorneys from Robbins Geller Rudman & Dowd LLP and Zeldes Haeggquist & Eck LLP in San Diego represented class members in the two California cases.
Class counsel agreed not to take any fees for their years of work as part of the settlement.
Daniel Petrocelli of O'Melveny & Myers LLP in Los Angeles led the team representing the defendants.
A settlement was announced shortly after the November election and a little more than a week before one of the class actions in San Diego was set to go trial, with Trump expected to be called as a witness. Low v. Trump University LLC, 10-CV0940 (S.D. Cal., filed April 30, 2010).
The plaintiffs in that case accused Trump University of having been more of an infomercial than a program that provided students with guidance on how to make money through real estate investing. Trump had denied the allegations, and neither he nor the other defendants admitted any wrongdoing or liability as part of the settlement.
The plaintiffs in the second case before Curiel had alleged Trump was part of a racketeering scheme through Trump University. Cohen v. Trump, 13-CV02519, (S.D. Cal., filed Oct. 18, 2013).
The settlement also covered a fraud suit that the New York attorney general's office filed in 2013 against Trump and Trump University.
Lyle Moran
lyle_moran@dailyjournal.com
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