Updates to our Terms of Use

We are updating our Terms of Use. Please carefully review the updated Terms before proceeding to our website.

Friday, May 24, 2024 | Back issues
Courthouse News Service Courthouse News Service

Judge Signs Off on $25M Trump U Settlement

It took a federal judge less than 24 hours to decline a Florida attorney’s request to opt out of the $25 million Trump University global settlement, granting final approval of the agreement Friday.

SAN DIEGO (CN) – It took a federal judge less than 24 hours to decline a Florida attorney’s request to opt out of the $25 million Trump University global settlement, granting final approval of the agreement Friday.

U.S. District Judge Gonzalo Curiel declined to grant final approval of the settlement from the bench at a hearing Thursday, during which Sherri Simpson’s attorney Gary Friedman argued why his client should be allowed to opt out – despite filing a claim to recover damages – so she could file her own fraud case against President Donald Trump.

The judge ultimately denied Simpson’s objection in his Friday order.

Curiel’s approval marks the end of the road for the seven-year-old case. Former students of Trump’s now-defunct real estate school filed class actions against the business mogul-turned-world leader over promises they’d learn his insider real estate secrets by instructors purportedly handpicked by the billionaire.

Students said they paid upwards of $35,000 for an education they said provided little more insight than an infomercial.

Trump admits no wrongdoing or liability as part of the finalized settlement.

At Thursday’s hearing, class attorney Rachel Jensen said about 3,700 students of the eligible class of 7,000 had filed claims to recover what they’d invested in the real estate school. Since not all those eligible to do so filed claims to get their money back, those who did will see a significantly bigger paycheck – 90 percent of what they invested in Trump University, according to Jensen.

That figure is a huge jump from the 50 percent refund the November settlement guaranteed, and 10 percent more than was confirmed in a trial brief filed by Jensen last week.

New York Attorney General Eric Schneiderman boosted the recovery for California class members when he committed to giving at least $1.6 million of the $4 million he received as part of the global settlement for the lawsuit, Jensen said Thursday.

Class attorney Amber Eck told Courthouse News the students could get their checks as soon as a couple months from now – assuming Simpson doesn’t appeal Curiel’s denial of her objection.

Eck said they are thrilled the settlement got approved so quickly.

“Judge Curiel's order brings us one step closer to closure for the class members who were deceived by Trump University.  Over the past seven years, our goal has always has been to help these everyday Americans move forward with their lives, and we're grateful to the court for moving things along quickly and efficiently as this case winds down. We look forward to finalizing the remaining details of the case over the next few months to allow disbursement of the settlement funds to class members as quickly as possible,” Eck said.

If an appeal is filed, however, settlement payments could be held up for years, she added.

Simpson has 30 days to file an appeal.

Curiel’s order approving the settlement Friday confirmed what he indicated at Thursday’s hearing: that he believes the settlement is fair and reasonable.

As for Simpson’s objection and request to opt out of the settlement, Curiel found because Simpson filed a settlement claim form to recover money, she “has accepted the financial settlement offered by defendants as complete redress for her injuries.”

Curiel noted the Ninth Circuit has ruled due process does not require an opt-out opportunity at the settlement stage as Simpson claimed.

“Simpson had the opportunity to opt out after she received the 2015 class notice, and could have moved the court to opt out even after the deadline had passed. She chose not to do so, and cannot now belatedly argue that due process compels a further opt-out opportunity,” Curiel wrote, noting he approved additional opt-out requests after the deadline had passed.

Curiel rejected an argument by Simpson’s attorney Friedman at Thursday’s hearing that a clause in the 2015 class notice guaranteed class members would be notified how to opt out if a settlement was reached.

“Any right to ‘ask to be excluded’ does not equate to a right to opt out. Indeed, by Simpson’s counsel’s own admission at the final approval hearing, Simpson, who is an attorney, did not read or understand the Section 13 parenthetical to guarantee her a second opt-out opportunity,” Curiel wrote.

“Simpson’s belief that she is entitled to a settlement-stage opt-out opportunity was not based on an objective reading of the notice’s language. Nor was it based on a subjective misunderstanding of the notice’s language. Rather, Simpson did not identify the Section 13 parenthetical as important in any way, until she conferred with counsel.”

The judge commended class counsel for litigating the case for free, giving up all attorney’s fees and costs, which he said “evidences not only a lack of collusion, but also that class counsel are in fact representing the best interests of plaintiffs.”

He also approved $15,000 class-representative awards for lead plaintiffs John Brown, Art Cohen, J.R. Everett and Sonny Low, as well as for former plaintiff Tarla Makaeff.

The class attorneys estimated that each representative “spent well over 100 hours” working on the case.

Follow @@BiancaDBruno
Categories / Consumers

Subscribe to Closing Arguments

Sign up for new weekly newsletter Closing Arguments to get the latest about ongoing trials, major litigation and hot cases and rulings in courthouses around the U.S. and the world.