Now-Defunct Trump U. Faces Fraud Lawsuits, Draws Attacks From Rivals

NY Times: Trump University, “A Series Of Seminars Held In Hotels,” Faces Three Pending Lawsuits Alleging Misrepresentation. The New York Times described GOP presidential front-runner Donald Trump's Trump University as “not a real university at all, but a series of seminars held in hotels across the country.” The now-defunct Trump University is currently facing multiple pending lawsuits brought by former students and by the state of New York, alleging misrepresentation:

The now-defunct Trump University, the subject of one of Marco Rubio's attacks on Donald J. Trump at the Republican presidential debate on Thursday night, was not a real university at all but a series of seminars held in hotels across the country that promised to share Mr. Trump's real estate investing acumen with students. It is still embroiled in lawsuits accusing it of misrepresentation.

Those who ultimately bought premium packages paid as much as $35,000 for the privilege of additional training, called mentorships and apprenticeships.

“Seventy-six percent of the world's millionaires made their fortunes in real estate,” Mr. Trump said in an email marketing blast sent to tens of thousands of potential customers. “Now it's your turn. My father did it, I did it, and now I'm ready to teach you how to do it.”

As many as 7,000 people across the country bought the sales pitch, spending an estimated $40 million. Both the State of New York and many of the students are now suing Mr. Trump for misrepresentation. Three cases are pending: one in New York brought by the attorney general and two in California, certified as class actions. [The New York Times, 2/26/16]

Politico: Trump Rivals “Are Seizing On Fraud Allegations” Stemming From Trump U. Politico reported that at the GOP presidential debate held on February 25, Sens. Marco Rubio (R-FL) and Ted Cruz (R-TX) both attacked Trump over the pending lawsuits against Trump University. Cruz specifically noted that the nature of the lawsuits meant that Trump may be required to testify in the case during the election cycle:

Donald Trump's Republican presidential rivals are seizing on fraud allegations made by former students of his Trump University to paint him as a sleazy businessman.

[...]

Sens. Marco Rubio and Ted Cruz, who are trailing Trump in the polls, used the latest developments as an opening to attack Trump's character at the Republican debate Thursday night.

Rubio accused Trump of starting “a fake university” that people borrowed $36,000 to attend. “And you know what they got? They got to take a picture with a cardboard cutout of Donald Trump,” Rubio said, echoing the complaints of some former students.

[...]

“It's a peanuts case, it's a very small case,” Trump said. Many students gave their Trump University courses high marks, Trump said, and they're just looking for their money back. Trump also claimed that “much of the case has already been won.”

But the class action case filed in California in 2010 by former students hasn't been resolved. No trial date has been set, but Trump's name has appeared on witness lists for both sides and court records indicate it could come to trial later this year.

“I want you to think about, if this man is the nominee, having the Republican nominee on the stand in court, being cross-examined about whether he committed fraud,” Cruz said during the debate. “You don't think the mainstream media will go crazy on that?” [Politico, 2/26/16]

NY Times: Conservative Group Launches “Hard-Hitting Ads” That “Raise Questions” About Trump's “Honesty And Trustworthiness.” On February 26, The New York Times reported that conservative group American Future Fund had begun launching a series of attack ads featuring former students of Trump University. In the ads, the students describe “having been lured into paying tens of thousands of dollars for business coaching that led nowhere.” The article noted that the ads target “an area [Trump's] critics have long perceived as a vulnerability, and his opponents have largely avoided” and that the ads aim to challenge Trump's “credentials as a businessman”:

Senators Marco Rubio and Ted Cruz assailed Donald J. Trump in the presidential debate on Thursday for his involvement in Trump University, a defunct educational company that triggered a massive fraud suit against Mr. Trump.

Now, voters are about to learn more about Trump University in television commercials.

The American Future Fund, a conservative nonprofit group, is preparing what a spokesman said is a multimillion-dollar ad campaign highlighting people who say they were ripped off by Mr. Trump's enterprise. The ads feature two men and one woman who describe themselves as having been lured into paying tens of thousands of dollars for business coaching that led nowhere.

The message of the ads appears to serve a dual purpose: to undercut Mr. Trump's credentials as a businessman, and raise questions in voters' minds about his honesty and trustworthiness.

One man featured in the ads, a retiree named Bob, says he was “scammed because I believed in Donald Trump.”

“Please don't fall for the same line that I fell for,” he says, adding of Mr. Trump, “He can make people believe, practically, anything.”

Sherri, a woman who is described as a single mother, says in another ad that she made a “huge mistake trusting” Mr. Trump, and said that all the promises Trump University made turned out to be “just a fake.” A third testimonial, from a young man named Kevin, may be the harshest.

“I spent about $30,000 on Trump University and, basically, all it did was ruin my credit and ruin my life,” he says, calling Mr. Trump “just a fraud, a misrepresentation.”

The exact scope and cost of the television campaign has not been announced, and the American Future Fund does not have to disclose its donors because it is registered as a nonprofit. But the hard-hitting ads strike Mr. Trump in an area his critics have long perceived as a vulnerability, and his opponents have largely avoided. [The New York Times, 2/26/16]

Trump Responded That He Already “Won Most Of The Lawsuit” And Trump U. Has “A” Rating From Better Business Bureau

Trump At GOP Debate: “I've Won Most Of The Lawsuit.” In response to Rubio's allegations at the February 25 CNN GOP debate that Trump had started “a fake university” and was being sued by former students, Trump repeatedly claimed, “I've won most of the lawsuit.” [CNN, Presidential Debate, 2/25/16]

Trump On Meet The Press: Trump U. Has “An 'A' From The Better Business Bureau.” In an interview on the February 28 edition of NBC's Meet the Press, host Chuck Todd asked Trump about the debate attacks on Trump University and the shuttering of the program. Trump responded by repeatedly claiming, “We have an 'A' from the Better Business Bureau.” Trump also doubled down on his earlier claims about the status of the pending lawsuits against Trump University, saying about the pending New York lawsuit, saying “that case has been largely won by me.” [NBC, Meet the Press, 2/28/16]

Fact-Checkers Concluded Trump's Defenses Are “Literally Wrong,” “Just Not The Case,” “False”

Wash. Post Fact Checker: Trump's Claim That He “Won Much Of” The Lawsuits Against Him “Misleading,” “Just Not The Case.” A February 27 article from the Washington Post's Fact Checker examined Trump's statements in defense of Trump University in which he claimed that he had “won much of” the lawsuits against the real estate seminar operation. Reporter Michelle Ye Hee Lee concluded that Trump “goes too far downplaying the allegations,” and that his portrayal that the pending cases are largely resolved is “just not the case.” Lee also noted that previous court rulings on the matter have been favorable for both sides (emphasis added):

In true Trump fashion, he boasts that he “won much of” or “most of” the lawsuits against him over Trump University. But all three lawsuits are pending. Trump can claim some court rulings favorable to himself, but so can the plaintiffs.

Trump also creates a misleading characterization of the plaintiffs filing the lawsuit against him, saying they signed an evaluation praising the program but are suing them just to get their money back. The charges in the lawsuit originate from attendees' complaints that they were misled into paying tens of thousands of dollars for a mentoring and training program that didn't deliver what it advertised.

Trump goes too far downplaying the allegations, by saying most of it is already resolved. That's just not the case.

Three Pinocchios. [The Washington Post, Fact Checker, 2/27/16]

Politico Wrongometer: “Unclear What Case Trump Was Talking About” In Debate Defense. In response to Trump's February 25 debate claim that he had “won most of the lawsuit” pending against Trump University, Politico education writer Kimberly Hefling wrote, “It is unclear what case Trump was talking about,” noting that lawsuits in California and New York are still pending against the real estate seminar program:

Trump “won most” of the Trump University lawsuit? Hm.

Marco Rubio called Trump University a “fake school” that only left students with a “cardboard cutout of Donald Trump.”

“There are people that borrowed $36,000 to go to Trump University and they are suing him now,” Rubio said.

In response, Trump said he “won most of the lawsuit” and that Trump University “actually did a very good job.” It's unclear what case Trump was talking about. In reality, there are still two pending lawsuits against Trump University, which didn't grant degrees but ran real estate seminars. A civil trial in the fraud case filed by former students that's been playing out in federal court in San Diego could come sometime after May 6, which is the scheduled date of the last pre-trial conference. In fact, Trump is on the witness list. A separate suit filed against Trump University by New York Attorney General Eric Schneiderman in 2013 is also still ongoing. While critics have accused Trump University of misleading students about its results, Trump's attorneys have said the accusations are without merit. [Politico, 2/25/16]

PolitiFact: Trump's Claim That Trump U. Has An “A” Rating From Better Business Bureau Is “False,” “Literally Wrong.” A February 28 PolitiFact fact-check concluded that Trump's claim that his real estate seminar institute has “an 'A' rating from the Better Business Bureau” is “literally speaking ... inaccurate,” since the bureau does not rate defunct programs like Trump University. The article noted that the Trump University program had documented ratings ranging “from A+ to D-” and was rated a D in 2010, one of the final years before it closed. Fact-checker Jon Greenberg concluded that the claim was “false,” because it was both “literally wrong,” and because it ignored other, lower scores:

Trump said about his entrepreneur institute that “we have an 'A' from the Better Business Bureau.” Literally speaking, that is inaccurate. The Better Business Bureau gives the program no rating today because it's no longer a going concern.

Trump University had an A at some point. The Better Business Bureau doesn't release details of its past ratings, but it did say Trump's program had ratings that ranged from A+ to D-.

What we do know, from several published reports and archived Web pages, is that the university had a D in 2010.

Trump's claim is literally wrong and also ignores the university's lower Better Business Bureau scores. We rate it False. [PolitiFact, 2/28/16]

Fact-Check: Conservative Ads Highlighting Fraud Claims Against Trump U. Are “Truthful”

Wash. Post Fact Checker Awarded Rare “Geppetto Checkmark” For Truth To Ads Highlighting Fraud Allegations Against Trump U. A February 29 Washington Post Fact Checker article gave its stamp of accuracy to American Future Fund's attack ads showcasing stories from former students of Trump University. The ads describe the students “falling for the Trump brand name” and paying thousands for “insight and expertise” that was “not forthcoming.” Reporter Glenn Kessler concluded that the seminar business “appears to have been a classic bait-and-switch-operation,” and noted that, more broadly, the “experience of fact checking Trump during this campaign suggests he has little regard for factual accuracy” (emphasis added):

All three victims in the ads tell a similar story of falling for the Trump brand name, and then discovering that they needed to keep paying more money to gain insight and expertise -- which was not forthcoming. In other words, Trump University appears to have been a classic bait-and-switch operation, designed to lure people into paying increasing sums of money.

In the 2012 election-year debate about Mitt Romney's management at Bain Capital, we warned repeatedly about campaign ads that may have stretched the facts about Romney's involvement in particular deals that led to job losses. But this collection of super PAC ads avoids that obstacle, in part because Trump said he was involved and selected the “professors” -- which was not the truth. As the university executive testified, none were chosen by Trump.

Moreover, Trump University is the subject of a fraud investigation by the New York attorney general and two class-action suits that are headed to trial. The accounts of these three alleged victims are backed up by many other similar accounts of woe -- as well as by the court filings.

One could quibble that the travails of Trump University do not directly prove that Trump himself is a “BS artist,” as Scott claims. But our own experience in fact checking Trump during this campaign suggests he has little regard for factual accuracy.

We award these ads the coveted Geppetto Checkmark. [The Washington Post, Fact Checker, 2/29/16]