SAN DIEGO (CN) — Donald Trump can call expert witnesses to testify in a class action that students who attended his now-defunct real estate school Trump University did indeed receive a valuable education.
U.S. District Judge Gonzalo Curiel ruled Tuesday that Trump will be able to call experts who, after analyzing Trump University materials, found the school provided a worthwhile investment to students who paid upwards of $35,000 to learn insider real estate secrets from experts and mentors "handpicked" by Trump.
The ruling was signed Monday but not made publicly available until Tuesday.
The plaintiffs in Cohen v. Trump, a three-year-old class action filed in San Diego, moved to exclude some of the expert witnesses Trump plans to call if the case goes to trial. The experts include Dr. DeForest McDuff, an economics expert who has analyzed the value of a Trump University education.
Lead plaintiff Art Cohen and others sued Trump for violations of the Racketeer Influenced and Corrupt Organizations Act — commonly called RICO — claiming he knowingly defrauded students out of thousands of dollars when they paid for Trump University seminars based on the claim that they would learn insider secrets from Trump's "handpicked" experts.
Curiel heard from Cohen and Trump's attorneys at a hearing on the motions to exclude expert testimony this past week. The experts at issue were retained to determine the educational value of a Trump University education.
Of major dispute was a survey developed by Cohen expert Michael Kamins, a professor at Stony Brook University who has conducted over 500 consumer surveys focused on how consumers interpret advertising.
Kamins found that Trump University's advertising and promotional campaign focused almost entirely on Trump and targeted his biggest fans. He also found the marketing and sales strategy encouraged prospective customers to make emotional rather than rational decisions and that a "98 percent" approval rating touted by Trump University "is not the product of reliable questions or methodology."
The survey by Kamins purports to demonstrate the materiality of Trump University's representations that students would learn from instructors "handpicked" by Trump, according to Curiel's summary of the facts.
Kamins surveyed 126 individuals using an online survey distributed through marketing research firm Spectrum Associates Market Research. The respondents had to be at least 21 years old and not have attended a Trump University live seminar or mentorship program in the past 10 years.
Kamins found 87 percent of respondents said the opportunity to learn Trump's "real estate secrets" positively impacted their decision to purchase a Trump University live event, and 83 percent reported an offer of being taught by Trump's handpicked instructors also positively impacted their purchase decision, according to Curiel's summary.
Trump argued that Kamins' survey was flawed because there was no control group and it took statements out of context, among other reasons. Trump also argued the Kamins survey constitutes a "distortion of market conditions" because it did not parallel the actual Trump University experience closely enough.
Curiel disagreed, finding that "by showing respondents representative TU print advertisements, as well as the 2-minute 'main promotional video' played at the beginning of the 90-minute free preview, the Kamins survey did present advertising that is substantially similar to that which would have been encountered by prospective TU customers."
The judge found that "any deficiencies in Kamins' methodology are the proper subject of cross-examination and expert testimony by the defense."
Most of Kamins' opinions will be allowed at trial, but Curiel said that he will consider the relevance of some of the professor's opinions as to the emotional decision-making aspect at trial.
Curiel also denied Trump's bid to exclude the testimony of Paul Habibi, a UCLA real estate lecturer retained by the plaintiffs who compared Trump University's live events with those offered by leading schools in real estate education such as the Wharton School at the University of Pennsylvania and the Stern School of Business at New York University.
Habibi said that Trump University did not provide students with the analytical tools to make sound real estate decisions; sometimes promoted illegal, unethical and/or risky investment strategies; and did not provide strategies or techniques unique to Trump. He also reviewed the resumes of 27 Trump University instructors and found they had experience primarily in sales and motivational speaking, not real estate investment or education, according to Curiel's summary.
Curiel noted that Trump's argument that Trump University could not be compared with top business schools because they "differed dramatically" was actually invited by Trump and the 90-minute free preview where he stated, "We're going to teach you about business, we're going to teach you better than the business schools are going to teach you and I went to the best business school."
The judge wrote in denying the request to exclude Habibi's testimony: "Many components of TU's marketing scheme and live events were designed to reinforce this comparison between TU and leading academic institutions."
Trump's rebuttal experts McDuff, Alan Wallace and Joel Steckel offer various critiques of Habibi, and Kamins and his survey. Curiel found most of their testimony is proper, given that they "speak to the same subject matter the initial experts addressed and do not introduce novel arguments."
Curiel did find, however, that McDuff's analysis of economic damages is excludable. He also found the testimony by Trump's three rebuttal experts has a "degree of overlap" and that if their testimony becomes cumulative at trial, notes it will be excluded.
There no additional hearing dates in the Cohen case currently scheduled through 2016.
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