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the election

There Are No Cheerleaders at Trump University

Little attention paid to the lawsuits spanning the country

How has it come to this?: Two presumed candidates for the presidency of the United States who are both deep in legal problems, the one accused for misdeeds deserving of prosecution under the Espionage Act of 1917, or so Republicans would have it, the other awaiting a court date in which he and his company have been accused of swindling a few thousand people. That Hillary Clinton's State Department e-mail has been serially served up in batches, re-awakening the story every few weeks, has made for a multi-course feast for the media, particularly at Fox News. When the story is not blaming Hillary for Benghazi, which has been running at Fox for three and a half years, the "news" hosts and panelists fill the time slots with wonderment why Ms. Clinton hasn't been indicted for her conducting classified national business on a private server.

But in contrast, lawsuits over Donald Trump and his Trump University have received muted attention. There were pieces of some length at
The Washington Post and Time magazine, but that was last fall. The New York Times did run a story as its lead article in mid-March, but on a Saturday, the least read day of the print edition. It is as if the weakened print media are wary of the cost of defending lawsuits from the notoriously litigious Mr. Trump, who has expressed his desire to "open up" the libel laws to wield against a free press.

Begun in 2005, Trump's purported "university" ceased operations in 2010 in the face of two lawsuits in San Diego, investigations by a number of states' attorneys general, and a suit brought by New York State Attorney General Eric Schneiderman (whom Trump calls a “political hack"). A judge in San Diego has allowed one of the two cases there to go forward under the Racketeer Influenced and Corrupt Organizations Act, or RICO, which says that the candidate could be branded a racketeer.

the up-sell

Marketing materials for Trump University lured students with the promise to teach them Donald Trump's "insider success secrets" on how to win in real estate. “He’s earned more in a day than most people do in a lifetime,” says a 2009 ad for Trump University. “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.”

In a promotional video, Trump said instructors would be "hand-picked by me". They would show how to structure get-rich-quick deals and even guide students to finding lenders to finance those deals with "other people's money". “We’re going to have … terrific people, terrific brains … the best of the best”.

Court documents said otherwise. The president hired by Trump to run the university said in a pretrial deposition that “none of our instructors … were handpicked by Donald Trump” and that the course curriculum was written by an outside firm that develops materials for adult education courses as its business.

Trump himself has been deposed. He admitted to these misrepresentations and could not explain some of the techniques that the marketing brochures pledged to teach, such as Trump's "foreclosure system" which the course writers had seemingly invented. Trump said he had personally approved the marketing materials but did not so much as review the curriculum — the contents of the courses that supposedly divulged his proprietary arts of the deal. He was thus not even interested in what was being taught. And the instructors were not successful real estate experts; they came from sales backgrounds. A couple of them had filed for personal bankruptcy.

Newspaper ads and invitations over Trump's signature sent by mail offered free 90-minute workshop sessions held in 700 locations across the country. Their goal was to persuade attendees to sign up for three-day workshops with a $1,495 tuition that would be "all you need" to go forth on the road to riches. Well, not quite, as it turned out, because at this second tier, the playbook for the "mentors" — who were paid commissions, not a salary — was to "set the hook" in their pupils to sell them third-level programs costing from $9,995 to $34,995.

And sell they did. Court disclosures show that 80,000 attended the 90-minute sessions and close to 9,200 continued to the $1,495 three-day course, during which the instructors urged participants to use the lunch break to call their credit card companies to expand their credit line so they'd have funds for their first real estate deal. But the New York suit alleges that the real purpose was to position the students to sign up for the up to $35,000 Trump Silver or Gold Elite packages they were about to up-sell. Some 800 took the bait.

Those who completed the course were promised a photo alongside The Donald, which turned out to be only a full-size cardboard cutout. (That a photo with him was a draw suggests what sort of people were drawn to Trump U.). The lenders whom the course mentors said they would help graduates find to finance projects proved non-existent.

Trump told the reporter from Time that “all money that I made was going to go to charity”. Court testimony and evidence say that checks or wire transfers totaling $5 million were sent him from the university because he wanted to make the charitable contributions from his personal accounts, but Trump admits to reneging when the law suits and legal fees started.

satisfied plaintiffs?

The suit brought by the New York attorney general seeks $40 million in restitution for the students it says were bilked by courses that did not live up to the misleading advertisements. In San Diego, Trump's lawyers argued that because students got varying degrees of value from the courses, their degree of damage claims varied, and therefore they should be required to sue individually, but the judge decided that so little value was conveyed in the course that the students were more uniformly defrauded, and the case was therefore allowed to go forward as a class action with some 7,000 plaintiffs. Trump “created, funded, implemented and benefited from a scam that cost them … thousands, even tens of thousands of dollars each”, reads the complaint.

On leaving, students filled out questionnaires. They were effectively coerced into signing "glowing evaluations" of the courses, says the Times article and others, pressured by the instructors looking over their shoulders, telling them that “Mr. Trump might not invite me back to teach again” if the reviews weren't excellent. “Beautiful statements” is what Trump calls the evaluations; “98% of the students that took the course gave it rave ratings”. As defense in the lawsuit, Trump's company set up a website, 98percentapproval.com, where 10,000 surveys are posted.

That number exceeds the 9,200 who took the three-day course (the 800 who went further are among them), suggesting that it includes some who only attended the 90-minute promotion. More contradictorily still, refunds were offered part way into the courses. In the $1,495 group, 32% were issued refunds. It was tougher to get the university to party with the $34,995 tuitions, students reported, but 16% got refunds in that group. Additionally, the mass of plaintiffs in the class action suit claim that they, too, had sought refunds, but were told that their requests were made too late according to university rules.

So the question is, how could 98% and the 10,000 be satisfied?

As the suit meandered through the courts, the Trump organization sent an e-mail blast to former students who had given a positive response in the questionnaires asking for yet another endorsement, but back came a flood of negative assessments from those who had evidently found the courses worthless in the outside world in the time since.

The judge in Sand Diego is currently weighing whether an August court date should take place in the midst of the election campaign. "This will be a zoo if it goes to trial", Trump's lawyer said to the judge.

In New York, the appeals court just ruled that one of Attorney General Schneiderman's fraud cases can go forward.

The Time piece concludes with a quote from a fellow named Bob Guillo who had gone for the whole Trump Gold Elite package:

“He’s the biggest phony in the world, yet people as gullible as me think he’s the greatest guy in the world. When I watch him on TV, I’m really impressed. I think, ‘How can people believe in him?’ And I think, ‘Well, Bob, you believed in him in 2009. You gave him $35,000.’”

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