In last night’s debate, as Donald Trump’s rivals looked for every possible vulnerability, Ted Cruz noted a court case against something called “Trump University.”
As the Texas Republican argued, “It’s a fraud case. His lawyers have scheduled the trial for July. 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. You don’t think the mainstream media will go crazy on that?”
I can’t speak to what may or may not happen in terms of media coverage, but Cruz certainly isn’t wrong about the underlying dispute. Michael Isikoff reported this week for Yahoo News:
Here’s a part of the political calendar that nobody in the Republican Party seems to have noticed: This spring, just as the GOP nomination battle enters its final phase, frontrunner Donald Trump could be forced to take time out for some unwanted personal business: He’s due to take the witness stand in a federal courtroom in San Diego, where he is being accused of running a financial fraud.In court filings last Friday, lawyers for both sides in a long-running civil lawsuit over the now defunct Trump University named Trump on their witness lists. That makes it all but certain that the reality-show star and international businessman will be forced to be grilled under oath over allegations in the lawsuit that he engaged in deceptive trade practices and scammed thousands of students who enrolled in his “university” courses in response to promises he would make them rich in the real estate market.
Though Cruz said the trial is scheduled for July, Isikoff noted no trial date has been set, though the judge overseeing the case “has indicated his interest in moving the case forward.”
And for Trump, that’s probably not an encouraging development. Recapping our coverage from several months ago, the Washington Post reported in September that the New York Republican was the namesake of a “university,” where students sometimes “max[ed] out their credit cards to pay tens of thousands of dollars for insider knowledge they believed could make them wealthy.”
Never licensed as a school, Trump University was in reality a series of real estate workshops in hotel ballrooms around the country, not unlike many other for-profit self-help or motivational seminars. Though short-lived, it remains a thorn in Trump’s side nearly five years after its operations ceased: In three pending lawsuits, including one in which the New York attorney general is seeking $40 million in restitution, former students allege that the enterprise bilked them out of their money with misleading advertisements.Instead of a fast route to easy money, these Trump University students say they found generic seminars led by salesmen who pressured them to invest more cash in additional courses. The students say they didn’t learn Trump’s secrets and never received the one-on-one guidance they expected.
“He’s earned more in a day than most people do in a lifetime,” a 2009 ad, featuring Trump’s photograph, said. “He’s living a life many men and women only dream about. And now he’s ready to share – with Americans like you – the Trump process for investing in today’s once-in-a-lifetime real estate market.”
A Trump attorney insisted that aspiring investors learned valuable lessons with which most students were satisfied. But the Post’s article also highlighted a Texas man, Louie Liu, who said he paid “$1,495 for a three-day seminar, then felt lured into paying $24,995 for more classes, an online training program and a three-day in-person mentorship.”
He now believes that the Trump University program was a “scam.”
For some, that’s not necessarily a deal-breaker in the 2016 race. Indeed, the Post’s article suggested that even Louie Liu, who considers himself a victim of a Trump “scam,” still likes Trump and might even vote for him. Trump “says what he means, not like politicians, not like Obama,” Liu said.
This from a guy who believes he was lured into paying Trump University tens of thousands of dollars, and when he asked for a refund, Trump U. refused.
Watch this space.
Postscript: Marco Rubio was also eager to pursue this line of attack last night, but he might want to think twice. The Florida senator supported “a for-profit college chain that has hurt far more students than Trump University has. Corinthian Colleges, which actually offered degrees and was regionally accredited, damaged far more students’ lives.”