SAN DIEGO (CN) – A Florida woman on Monday threw a wrench into what was expected to be a smooth approval hearing in federal court later this month in the $25 million Trump University settlement by objecting to the settlement agreement and insisting class members be allowed to opt out, despite already being given that opportunity years ago.
Sherri Simpson, through her attorney Gary Friedman of New York, filed an objection to the global class action settlement reached last November when Trump agreed to pay $25 million to a class of 7,000 former Trump University students who said they were duped into investing in a real estate education that offered industry insight equivalent to that of an infomercial.
Trump did not admit any wrongdoing or liability by settling.
Simpson said the settlement agreement violates the class members’ rights to opt out of the settlement, which was expressly outlined in the “What if I do Nothing?” section of the 2015 class notices.
The class notices were sent to former Trump University students with the opt-out deadline falling on Nov. 16, 2015. Only 13 people opted out of the class, with many of the opt-outs considered “Trump supporters” who did not want to sue him. None of the opt-outs have so far filed their own lawsuits against Trump and his real estate school, according to Simpson.
Simpson attended a three-day Trump University seminar in April 2010. She later purchased the $35,000 “Gold Elite” package in May 2010 which was supposed to come with a year of mentorship from a real estate expert purportedly “handpicked” by Trump himself.
But Simpson says she later learned Trump University was “film-flam, a hoax, a scam” and that there were “no materials at all that one couldn’t have just grabbed off the internet.” She demanded a refund but got no response, and eventually retained an attorney to file her own case.
Simpson decided to hold off filing her own lawsuit when she learned about the class action, according to her filing.
“From the point of view of class members such as Ms. Simpson, there was precious little reason to exercise the right to opt out at that juncture. The case was barreling towards trial, by all accounts. The plaintiffs’ lawyers were obtaining excellent results, having prevailed against hotly litigated dispositive motions. And, if the case were to settle down the road, the class member could rest assured that she would be afforded the opportunity to ‘ask to be excluded from any settlement’ at that point,” according to the memorandum.
The settlement violates the due-process rights of class members “robbed” of their right to request exclusion, Simpson says.
Rather than reject the settlement outright for not including an opt-out notice, Simpson suggests U.S. District Judge Gonzalo Curiel should require a “settlement-stage opt-out opportunity.” Now that class members have more information about the settlement terms then when the initial class notices were sent out in 2015, Simpson claims they may want to pursue their own litigation. At the time the 2015 notices went out, there was no settlement or prospective settlement terms on the table and class members were assured there would be a second opt-out opportunity if a settlement was reached.
The settlement also “releases Trump from liability” on claims the class could not have brought, but which individual opt-out members could have raised in their own lawsuits, such common-law fraud claims under Florida law where Simpson lives.
“If the settlement indeed represents 50 cents on the dollar of loss, as has been reported, it is certainly a beneficial settlement by the standards of class actions. But there is no principle of law or fairness that requires Sherri Simpson to accept 50 cents on the dollar. What Ms. Simpson seeks is her day in court, at which she will press for the complete vindication of all her rights, including her full damages plus punitive damages and injunctive relief. Due process guarantees her the autonomy to pursue these goals,” Simpson says in the filing.
She filed a claim with the settlement administrator in case her motion to opt out is denied by Judge Curiel.
Friedman said in an interview with Courthouse News the attorneys who worked on the settlement agreement reneged on their explicit notice there would be a second opportunity to opt out.
The attorney said Trump would likely not have agreed to a settlement if opt out notices were required to again be sent out following the nearly seven-year litigation.
Friedman said they are asking Curiel to require the class attorneys to circulate opt-out notices to all class members. He said doing so would not necessarily render the $25 million settlement moot but would give Trump and his attorneys insight into how many people want to opt out of the settlement.
While Curiel preliminarily approved the settlement late last year, the oversight on the need to provide a second opt-out notice was on the part of the attorneys, and not the court, Friedman said.
“It is never really the responsibility of the court to know all the details of a settlement. It’s the lawyers’ job,” Friedman said.
Friedman plans to attend the final settlement hearing in San Diego’s federal court March 30 to argue why Simpson’s objection and request to be excluded from the settlement should be allowed.
Attorneys for the class members and Trump did not respond to email requests for comment.
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