Litigation
Apr. 1, 2017
Judge appears likely to approve $25M settlement of Trump University suits
U.S. District Judge Gonzalo P. Curiel called the percentage of funds that class members were expected to recoup from the resolution of the high-profile cases an "extraordinary amount."
Daily Journal Staff Writer
SAN DIEGO — A federal judge appeared inclined Thursday to give final approval to a $25 million settlement that would resolve three fraud suits against President Donald J. Trump's defunct Trump University, but the court took the matter under submission after hearing concerns raised by an objector.
U.S. District Judge Gonzalo P. Curiel called the more than 80 cents on the dollar that class members were expected to recoup from the resolution of the high-profile cases an "extraordinary amount."
Curiel made the statement before being informed by plaintiffs' counsel at the end of a final approval hearing that the thousands of class members were now expected to get back at least 90 percent of the money they paid to Trump University.
"It really is a historic settlement and historic opportunity for them," said plaintiffs' counsel Jason A. Forge, a partner at Robbins Geller Rudman & Dowd LLP in San Diego.
The boost in the planned repayment was a result of the New York attorney general's office agreeing to divert at least $1.6 million of the $4 million it was slated to receive from the settlement back to class members in the two California cases before Curiel, said plaintiffs' attorney Rachel L. Jensen, a Robbins Geller partner.
Roughly 3,730 former Trump University students submitted claim forms in the aftermath of the agreement announced last November. The refunds they would receive were also bolstered by the plaintiffs' attorneys previously agreeing not to seek fees as part of the settlement.
Some of the former students had spent upward of $35,000 on seminars that they alleged were more like infomercials than programs providing guidance on how to make money through real estate investing.
Trump did not admit any wrongdoing as part of the settlement. Daniel Petrocelli of O'Melveny & Myers LLP in Los Angeles led the team representing the defendants.
Sherri Simpson, a Florida attorney, was the only objector represented at Thursday's hearing.
Gary Friedman, Simpson's New York-based attorney, argued to Curiel that his client should be able to opt out of the settlement to pursue her own case against Trump.
Friedman said his client was not properly given another chance to be excluded from the class after the settlement was reached. Curiel appeared skeptical of the argument.
Plaintiffs' attorney Patrick J. Coughlin, of counsel at Robbins Geller, highlighted how Simpson never opted out of the class during the litigation and even recently submitted a claim form indicating she wanted to accept the settlement after it was reached.
"She did not bring any issues up until she was contacted by counsel," Coughlin told Curiel.
Friedman admitted calling Simpson, but said she was already unhappy about the settlement and expected she could still opt out to pursue legal claims.
Sonny Low, a named plaintiff in one of the cases that would be resolved, told the Daily Journal he was very happy with the settlement. Low v. Trump University LLC, 10-CV0940 (S.D. Cal., filed April 30, 2010).
The second California case that would be resolved alleged Trump was part of a racketeering scheme through Trump University. Cohen v. Trump, 13-CV02519, (S.D. Cal., filed Oct. 18, 2013). The third case in question was brought by the New York AG in 2013.
Lyle Moran
lyle_moran@dailyjournal.com
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