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Trump Agrees To Settle Trump University Lawsuits For $25 Million

SCOTT SIMON, HOST:

President-elect Donald Trump has agreed to pay $25 million to settle three lawsuits that targeted his now-defunct Trump University real-estate seminars. As part of the settlement, he admits no wrongdoing. NPR's Ina Jaffe has been following the case. Thanks for being with us, Ina.

INA JAFFE, BYLINE: Hi, Scott.

SIMON: President-elect Trump said - did not admit wrongdoing. So what are the indications as to why the suit was settled?

JAFFE: Well, Alan Garten, the general counsel for the Trump organization, released a statement saying that there was, quote, "no doubt that Trump would have won a trial." But he said the resolution of the lawsuits allows the president-elect to devote his full attention to the important issues facing the nation.

SIMON: Where does that $25 million go?

JAFFE: $1 million will go to the state of New York, which brought one of the lawsuits. The rest of the money will go to the plaintiffs. All of them are former students of Trump University. Now, these are class-action suits. And there could potentially be thousands of plaintiffs. But the attorneys for the two other lawsuits said in the statement that they won't be taking any fees, so that all the money can go to their clients.

SIMON: Ina, bring us back to what these cases were all about, if you could.

JAFFE: Well, they were about whether Trump University really did what Donald Trump said it would. In videos and print ads, he said that the instructors would be, quote, "the best of the best," all of them hand-picked by Trump himself. And potential students were told they would learn his real-estate investing secrets.

SIMON: Now, Mr. Trump often points out that the school, at least on the website, had an overwhelmingly favorable rating from former students. But the plaintiffs say that it wasn't like that at all.

JAFFE: Really, that's exactly what they say. They argue that the whole point to this school was to keep selling students increasingly expensive seminars. First, there was a free introductory course where students were told they could make tens of thousands of dollars in just a couple of months using Trump's investment techniques.

But to learn those, they had to sign up for another seminar that cost about 1,500 bucks. And at that seminar, they were sold another course that cost as much as $35,000. They claim that students were encouraged to go into credit-card debt and even cash out their 401(k)s to pay for these top-level courses.

SIMON: The settlement was reached. Well, one of these suits was about to go to trial on Monday, wasn't it?

JAFFE: Yeah, it was, though attorneys for Trump wanted it delayed because he was too busy with the transition. But, clearly, his schedule wasn't going to get any easier once he became president. So the judge in the case was urging both sides to settle.

SIMON: Donald Trump, Ina, has said in a number of interviews that he doesn't like settling lawsuits, that he prefers to see things through.

JAFFE: Right. He says settling only encourages people to sue him, which is why earlier attempts to settle had been fruitless. And if you want to know what the process was like, here's a statement from New York Attorney General Eric Schneiderman which gives you an idea of what the process was like.

He wrote, Donald Trump fought us every step of the way, filing baseless charges and fruitless appeals and refusing to settle for even modest amounts of compensation for the victims of his phony university.

SIMON: Well - and now they'll get $25 million, right?

JAFFE: I guess.

SIMON: NPR's Ina Jaffe, thanks so much for being with us.

JAFFE: You're welcome. Transcript provided by NPR, Copyright NPR.