Donald Trump Reaches $25 Million Settlement In Trump University Case

Nov 18, 2016
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KELLY MCEVERS, HOST:

Donald Trump has agreed to pay $25 million to settle three lawsuits that targeted his now-defunct Trump University real estate seminars. NPR's Ina Jaffe has been following the cases, and she is here in the studio with me now. Hi, Ina.

INA JAFFE, BYLINE: Hi.

MCEVERS: So what can you tell us about settlement?

JAFFE: Well, Trump or his businesses will pay $25 million compensation to the plaintiffs in these suits. And that includes a million dollars to the state of New York. The settlement encompasses a case brought by the state of New York as well as two other cases that are in federal District Court in San Diego. It's unclear at this moment how much money each plaintiff would receive, since these are class-action suits potentially involving thousands of plaintiffs.

MCEVERS: Remind us what these cases were about.

JAFFE: Well, they were about whether Trump University really did what Donald Trump said it would do. In videos and print ads, he said that the instructors - who he called professors - would, quote, "be the best of the best," all of them handpicked by Trump himself. The ads all included Trump's photo and usually his signature. And potential students were told they would learn his real estate investment secrets.

MCEVERS: And the plaintiffs are saying it wasn't like that?

JAFFE: (Laughter) Exactly. They argue that the whole point of this school was to keep selling students increasingly expensive seminars. First, there was a free introductory session. Transcripts show that instructors told students they could make as much as $50,000 within a couple of months if they used Donald Trump's techniques. But to learn those, they'd have to sign up for another seminar that cost about 1,500 bucks, where they were sold another program with one-on-one mentoring that cost about $35,000. And one of the allegations in the suit was that students were encouraged to go into credit card debt and even cash out 401(k)s to pay for these top-level courses.

MCEVERS: And the plaintiffs claim that the courses themselves didn't deliver on their promises?

JAFFE: Right. They claim that the promised Donald Trump investment techniques were mostly stuff that you could find on the internet, some of which was illegal in some of the states where the seminars took place. They say that the promised mentoring was worthless or non-existent, that the instructors were unqualified and that they were definitely not handpicked by Donald Trump, as he claimed. And transcripts of Donald Trump's deposition in this first case confirm that he was relatively unengaged with what went on in Trump University.

MCEVERS: Donald Trump has pretty famously said he doesn't like settling lawsuits. Is this settlement a surprise?

JAFFE: Yeah. He said it only encourages people to sue you if you settle. It appears that the talks in these cases had been going nowhere until recently. New York Attorney General Eric Schneiderman put it this way in a statement today, he said, Donald Trump fought us every step of the way, filing baseless charges and fruitless appeals and refusing to settle for even modest amounts of compensation for the victims of his phony university.

MCEVERS: The settlement seems to have been reached in the nick of time. One of the three suits was about to go to trial the Monday after Thanksgiving.

JAFFE: It was. In fact, there was a hearing scheduled this afternoon to see if Trump could get a delay. This was for a civil fraud case that was originally supposed to go to trial during the campaign. So the judge had moved it until after Election Day, but before Inauguration Day in case Trump won. But in the last week or so, attorneys for Trump have been arguing that he was too busy with the transition to deal with the trial right now. Clearly his schedule wasn't going to get any easier once he became president.

MCEVERS: That's NPR's Ina Jaffe. Thank you very much.

JAFFE: You're welcome.

ROBERT SIEGEL, HOST:

In a statement to NPR, Alan Garten, general counsel for The Trump Organization said this - while we have no doubt that Trump University would have prevailed at trial based on the merits of this case, the resolution of these matters allows President-elect Trump to devote his full attention to the important issues facing our great nation. Transcript provided by NPR, Copyright NPR.