Judge approves $25 million Trump University settlement

Judge approves $25 million Trump University settlement



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A federal judge has approved a $25 million settlement President Donald Trump agreed to late last year in a bid to head off a civil fraud trial over his Trump University real estate seminar program.



U.S. District Court Judge Gonzalo Curiel issued a 31-page ruling Friday deeming the deal fair and overruling claims from some former Trump University students that they should get larger payments or be allowed to drop out altogether in a bid to force Trump into a trial.Under the settlement, former Trump University students are expected to get 80 percent to 90 percent of what they paid — typically about $1,500 for a three-day seminar or $35,000 for an in-depth mentorship program.



Curiel called that result “extraordinary” when measured by the yardstick of other class actions that are often settled for pennies on the dollar.



“The extraordinary amount of recovery for Eligible Class Members — an estimated 80%, and potentially higher — is all the more exceptional when viewed in light of the risk of establishing liability at trial, the likelihood of appeal, the possibility of reversal, the complexity of conducting thousands of individual damages determinations, and the likely lengthy duration of further litigation. Moreover, none of the amount offered in settlement will inure to Class Counsel’s benefit, as Class Counsel do not seek any fees or costs,” Curiel wrote.



“Courts have approved settlements with recovery rates far lower than provided for in the instant Settlement,” the judge said. He also praised the class-action lawyers involved for boosting the value of the settlement by giving up their legal fees and waiving expenses incurred in pursuing the cases.



The federal lawsuits — one of which dates to 2010 — alleged that Trump and his aides made several misrepresentations about the program, including claiming that Trump hand-picked the instructors, that the program was akin to a traditional university and that it would share “secrets” Trump had not discussed elsewhere.Trump’s attorneys denied any fraud and said any loose language in the marketing of the program was no more than “mere puffery” that courts have not found to be legally actionable.



During the presidential campaign, Trump repeatedly vowed not to settle the case. He also attacked the San Diego-based Curiel’s pretrial rulings and accused him of bias based on his Latino heritage, calling the judge “Spanish” although he was born in Indiana.



With jury selection set to begin in one of the cases shortly after Thanksgiving last year, Trump agreed to the $25 million settlement, which also involved a $4 million payment to resolve another suit brought by New York State Attorney General Eric Schneiderman.



In the ruling Friday, Curiel overruled an objection to the settlement by Florida bankruptcy attorney Sherri Simpson, who attended the weekend seminar and split with another person the cost of the $35,000 mentorship.



Simpson’s lawyers argued at a hearing before the judge Thursday that class members should have a right to opt out of the settlement and that an official notice published in 2015 indicated that Trump University students would be given another opportunity to pull out if a settlement was reached. Simpson has said she wants to take Trump to trial over the alleged fraud.



But Curiel said the law doesn’t guarantee class members a right to opt out at this stage and the language in the 2015 notice didn’t promise one either.



“It clearly apprised Class Members that if they wished to bring a separate lawsuit against Defendants, they had to elect to opt out immediately,” the judge wrote. “A plain reading of the parenthetical that Simpson seizes upon — ‘or how to ask to be excluded from any settlement’ — does not objectively give rise to the conclusion that Simpson had an unequivocal right to opt out of the Settlement.



“An average Class Member (and here, an attorney, no less) would not objectively understand the parenthetical to guarantee a settlement-stage opt-out opportunity that would allow absent class members to pursue separate litigation against Defendants,” Curiel added.



An attorney for Simpson did not immediately respond to a question about whether she plans to appeal. If she does so, it could hold up the distribution of funds under the settlement by a year or longer.



However, lawyers for the class have indicated they will try to force Simpson to post a bond that could cost her money if she loses the appeal.



In a statement, Schneiderman welcomed the judge’s approval of the settlement.