Watch CBS News

Lawsuit accuses Donald Trump of deceiving students

A class-action lawsuit in California accuses Donald Trump of bilking students at his for-profit Trump University.

Plaintiff Art Cohen, a California businessman, alleges in a 2013 complaint that Trump lead him and about 5,000 other Trump University students to believe they would receive an education on par with elite business schools, such as the University of Pennsylvania's Wharton School of Business. Cohen, who says he spent $36,490 for a three-day seminar, also said that Trump seemed to have no involvement in the course and that the caliber of instruction was subpar.

Jason Forge, a San Diego attorney who is representing Cohen, is seeking damages under the federal Racketeer Influenced and Corrupt Organizations Act. Forge argues that Trump played an integral role in crafting the marketing for Trump University. According to a court filing:

... Trump did not fulfill the promises he made to student-victims around the country -- he did not teach students his coveted real estate investing 'secrets' at the Live Events, he did not contribute in any meaningful way to the curriculum for the Live Events, and he did not handpick the Live Event seminar instructors and mentors who 'taught' student-victims at 3-day Live Events and Elite mentorship programs -- both of which were upsells from the free introductory Live Event called the 'Preview'.

In a setback to Trump, a judge certified the California case as a class action. This is difficult to get because the plaintiff has to show that members of the class were injured in the same way and that the person bringing the case is an accurate representative of the others involved in the case, according to Cornell Law School Professor Robert C. Hockett . Most lawsuits like this one are settled out of court.

The California case is similar to a complaint filed against Trump earlier this year by New York Attorney General Eric Schneiderman. In that case, a judge found Trump personally liable for operating his his school in New York without a license. The New York State Department of Education also admonished Trump in 2005 for improperly calling his school a "university," which is why its name was changed to the Trump Entrepreneurial Initiative. The program didn't offer degrees and is no longer operating.

Donald Trump files lawsuit, wants name removed from Atlantic City casinos 02:52

The 68-year-old Trump, a real estate developer known to television viewers in the past few years as the star of the TV reality show "The Apprentice," denies any wrongdoing in both cases and has vowed to mount a vigorous defense.

In an interview, Alan Garten, the Trump Organization's executive vice president and general counsel, said that Donald Trump is being unfairly targeted. Garten also claimed that the vast majority of Trump University students are pleased with their experience.

"We plan to appeal," Garten said of the decision to certify Cohen's suit as a class-action, adding that he expects to prevail since the ruling showed a "manifest disregard for the law." Trump also will ask the judge in the case, Gonzalo P. Curiel, to recuse himself because of what Garten called "animosity toward Mr. Trump and his views."

In New York, Trump has filed an ethics complaint against Schneiderman in connection with the case, which is seeking $40 million in damages.

"The Attorney General is getting crushed." Garten said. "The case has now been shrunk from six claims to two."

"The only thing they have prevailed upon is the licensing issue.... That is usually dealt with at the administrative level and usually doesn't even result in a fine," he added.

According to Garten, the roughly 121 students from New York State whose claims remain spent approximately $105,0000 on Trump programs, meaning that Schneiderman will only be able to collect a fraction of the $40 million he aimed to get in his suit.

"It's a disgusting waste of the taxpayers' money to advance the political interests of the attorney general," he said.

For its part, Schneiderman's office disputes Garten's categorization of the case and claims that Garten's attack on the Attorney General is "nothing we haven't heard before," according to spokesman Andrew Friedman. He declined to comment further.

View CBS News In
CBS News App Open
Chrome Safari Continue
Be the first to know
Get browser notifications for breaking news, live events, and exclusive reporting.