Thousands of Trump University Students Sign Up for RefundsBy
More than half of ex-students filed claims in fraud settlement
Judge set to approve deal Thursday in San Diego federal court
Former Trump University students who claimed a share of the $25 million settlement that Donald Trump agreed to shortly after he was elected president are poised to recoup 80 cents for every dollar they spent on the real-estate seminars.
They sued for fraud, claiming they’d been duped by false promises of riches and instant success. After years of insisting the allegations were groundless, Trump agreed to the deal that’s before the court for approval Thursday.
Over half -- about 3,700 -- of the more than 6,000 former students have submitted claims to be part of the class-action settlement. That’s a high participation rate for a consumer class action. A 2013 analysis by the Mayer Brown LLP law firm showed that in some cases, fewer than 1 percent of eligible beneficiaries filed claims.
The case became a flash point during the 2016 presidential election campaign as critics pointed to the allegations to raise questions of whether the Republican candidate could be trusted. Trump drew further attention to it as he accused the judge, born in East Chicago, Indiana, and of Mexican descent, of being biased against him because of his pledge to build a wall between the U.S. and Mexico.
That publicity -- the deal was reached 10 days after the election -- helped drive up the participation rate. Also significant was how much money people spent on the classes. Tuition ranged from $1,495 for a three-day seminar to $35,000 for an “elite” package.
"If you can get $20,000 back, it’s going to be more worth your while than when you can get 90 cents because of some yogurt you once bought,” said Amber Eck, one of the lawyers representing the former students.
When the accord was announced, the estimated recovery rate was 50 percent, with the assumption that all eligible students would file claims.
Based on the claims actually submitted by the March 6 deadline, the former students participating in the settlement will receive more than 80 percent of what they paid for seminars, lawyers for the former students said in a court filing last week.
A total of 2,471 claims seeking $21.3 million in refunds had already been verified, according to the filing. With hundreds of claims still being reviewed, the lawyers expect that refund requests will rise to $25 million.
The settlement allocates $21 million for ex-students nationwide covered in two class action cases filed in San Diego and $4 million for students from New York who were represented by that state’s attorney general in a separate lawsuit.
One of the San Diego cases was scheduled to go to trial before Trump’s inauguration. He was accused of defrauding students of his now-defunct, namesake education business by falsely promising them they’d be taught his real-estate investment secrets by his handpicked instructors.
The Trump Organization said at the time it was settling the cases so that Trump could focus on his transition even though it was confident it would have prevailed at trial. Trump repeatedly denied the fraud allegations and cited Trump University’s 98 percent approval rating as evidence the program was providing valuable instruction.
“This is a fair, reasonable and accurate settlement,” U.S. District Judge Gonzalo Curiel said during a hearing Thursday, adding that he wanted to hear the objections of two former students before issuing a decision.
One objector claimed in a court filing that she should be allowed an additional opportunity to opt out, while the other wants more than $100,000 in damages.
The case is Low v. Trump, 10-cv-00940, U.S. District Court, Southern District of California (San Diego).
— With assistance by Bill Callahan