A “class action” suit is a vehicle for a large group of Plaintiffs to bring suit together to litigate a common interest. The creation of the “class action” was an attempt to provide a way for people to unite who had a common interest, and had all been the victims of some type of wrong doing, but who might not have had the financial ability to pursue their claims individually. One of the most widely publicized examples of class action suits is the asbestosis litigation. In the United States alone, asbestos litigation is the longest, most expensive mass tort in U.S. history, involving more than 8,400 defendants and 730,000 claimants as of 2002. The Plaintiffs in these cases are people who have suffered health problems as a result of exposure to asbestosis. The defendants are companies who manufactured or installed asbestosis. The knowledge of the Defendants of the harmful effects of exposure to asbestos is probably the single biggest point of controversy in that type of class action.
Contrast that class-action to all who were defrauded by Donald Trump through Trump University. That class-action is more like the Bernie Maddoff action, which was filed by investors who were all defrauded by Madoff of Billions of Dollars.
Trump only defrauded students of millions, not billions, but perhaps Trump should have been charged with criminal wrongdoing instead of simply being sued in civil court. A trial attorney’s job includes evaluating the potential risk of loss of a case at trial. Often cases are not settled until the eve of trial, especially if the Defendant has more financial ability to litigate. The reality is that litigation often results in settlement because the Defendant can afford the enormous expense of litigation and the Plaintiff simply can’t. Settlement is also achieved as a result of the Plaintiff’s inability to tolerate a loss of the case. That means that a Plaintiff may be willing to compromise the amount he/she is willing to take in settlement, to ensure that at least part of their loss is paid back. A Defendant is motivated to settle a case when the potential exposure is great, and when the Defendant has a poor relationship with the Judge. In Trump’s case his exposure for fraud was great, and his poor relationship with the Judge became the subject of national news coverage.
Trump said that the case should have been resolved by Summary Judgment long ago. That means that in Trump’s mind there was no legitimate controversy to be litigated. As a matter of law, Trump asserted that there was no issue of fact to be given to a jury. He felt the Judge,Judge Gonzalo Curiel, should have taken the case out of the hands of the jury and ruled, from the bench that he won. Obviously that didn’t happen. The case was set for trial Monday , November 28th, right after Thanksgiving. On the eve of trial Donald Trump has settled the class action cases for $25 million according to a statement released by New York Attorney General Eric Schneiderman on Friday. The victims—some 6,000 people in New York, California, and Florida—will each receive restitution while up to $1 million will be paid to New York state as a penalty for violating education laws, according to Schneiderman’s statement. Twenty five Million Dollars is NOT a nusiance value settlement. Twenty-Five million dollars is a significant settlement. Payment of one million dollars as a penalty for violating the law is a significant payment, and an indication that Donald Trump had significant concern about a finding that he had violated New York laws.
The allegations of fruad by Trump University included complaint that “the promised Donald Trump investment techniques were mostly stuff that you could find on the internet. They say that the promised mentoring was worthless, that the instructors were unqualified and were not hand-picked by Donald Trump, as he claimed,” However the most troubling claim came from the New York State Department of Education (SED). The NY Department notified Donald Trump individually, that Trump University was violating the New York Education Law by using the word “University” when it was not actually chartered as one. Likewise, Trump University was also violating the Education law because it lacked a license to offer student instruction or training in New York State. However the organization would not be subject to the license requirement if it had no physical presence in New York State, moved the business organization outside of New York, and ceased running live programs in the State. In June 2005, “Trump University” notified the Attorney General of New York that ” Trump University” would merge its operation into a new Delaware LLC, and would indeed cease holding live programming in New York State. Yet that was not true either!
Trump University failed to abide by their representations. In spite of the assurances of Trump University to the Attorney General of New York, the Attorney General learned in 2009, through newspaper advertisements and a student complaint to the New York State Attorney General, that Trump University was continuing to provide live programming and instruction in New York without obtaining proper licensing or moving its operations out of New York. In May 2010, five years after being told Trump must stop using the word “University,” Trump University filed a certificate of amendment to its Articles of Organization, thus formally changing its name to TEI. Even then Trump was required to obtain a license to operate which he failed to do.
Thus, it appears that Donald Trump has once again used his wealth to excuse his violation of the law, and fraud committed against thousands of common people. This settlement seems to come at a time that President-Elect Trump should have had more incentive than ever to try his case, if in fact he had not committed fraud. Whether a jury believes a witness or not is often outcome determinative in a suit. Imagine having the President-elect testifying before a jury. In the absence of compelling evidence to the contrary, most attorneys would find that witness to be highly credible. The fact of this high dollar settlement is even more troubling as we remember that Trump and his businesses have been involved in at least 3,500 legal actions in federal and state courts during the past three decades. They range from skirmishes with casino patrons to million-dollar real estate suits to personal defamation lawsuits. Just since he announced his candidacy, at least 70 new cases have been filed. And the records review found at least 50 civil lawsuits remain open even as he moved toward claiming the nomination at the Republican National Convention in Cleveland. “The legal actions provide clues to the leadership style the billionaire businessman would bring to bear as commander in chief. He sometimes responds to even small disputes with overwhelming legal force. He doesn’t hesitate to deploy his wealth and legal firepower against adversaries with limited resources, such as homeowners. He sometimes refuses to pay real estate brokers, lawyers and other vendors.”
It seems it was just a few months ago that Trump declared: “I could have settled but won’t out of principle!” “I don’t settle lawsuits.” “Probably should have settled it, but I just can’t do that. Mentally I can’t do it. I’d rather spend a lot more money and fight it.”
The settlement of this lawsuit is an embarrassment to the American people. An agreed settlement of this magnitude signals the admission of Donald Trump of a likelihood that he would have lost the suit. That would have meant that American voters had elected a man who used his power, wealth, and celebrity status to defraud average Americans. …Oh wait, that’s what happened on November 8th!