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Donald Trump Still Dogged by Simmering Trump University Scandal

Donald Trump hawking  sign copies of "How To Build Wealth," a series of nine audio courses created by Trump University. He's being sued for fraud over the defunct school.  (Photo by Scott Gries/Getty Images)

Donald Trump hawking sign copies of “How To Build Wealth,” a series of nine audio courses created by Trump University. He’s being sued for fraud over the defunct school. (Photo by Scott Gries/Getty Images)

Donald Trump is still on the hook for potentially millions of dollars in damages arising out of a scandal and lawsuit over another of his failed ventures, Trump University. In the latest development, a judge refused to dismiss him as a defendant in a California class action,.

Trump was seeking a summary judgment dismissing the claims.

But yesterday (Nov. 19), U.S. District Judge Gonzalo Curiel, sitting in San Diego, denied most of Trump’s motions.

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The judge ruled against Trump on a key count, his personal liability.

“Such liability can be imposed against people who aid and abet in the violation, and there is evidence that Trump personally participated in the misrepresentations and misconduct alleged by the students, the judge said.

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The ruling clears the way for a trial, barring further appeals.

Trump lawyer Jill Martin said the Trump Organization looks forward to finally bringing this case before a jury. She asserts 98 percent of Trump students had a positive experience with its courses.

Trump started the “university” in 2004 with partner Michael Sexton, who served as president. It was supposed to impart the Donald’s real estate wisdom, but fees were hefty.

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In 2010, New York state shut down the school for failing to obtain a license to operate an educational institution. In response, Trump merely renamed the program the “Trump Entrepreneur Initiative” and continued raking in cash.

New York Attorney General Eric Schneiderman sued Trump in New York State Supreme Court in August 2012, charging Trump and his organizationwith fraud.

Schneiderman won a judgment in the case last year for up to $40 million.

Judge Cynthia Kern ruled that Trump knew that the school’s continued operation was against the law, yet he continued to operate it anyway. The judge also dismissed Trump’s counterclaim against Schneiderman alleging malicious prosecution.

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“This was a bait and switch in the hardest economic times, preying on people who could not afford to buy these programs,” Schneiderman said after filing the suit. “Mr. Trump used his celebrity status to lure people in.”

More than 5,000 people bought courses to learn Trump’s so-called “real estate investing secrets and techniques,” according to court papers. In all, the scam cheated students out of $40 million, Schneiderman charged.

Disgruntled students filed the California class action separately. The class was certified in 2014 to include everyone who have not received a full refund for Trump University courses in California, New York and Florida.

A separate federal class action is also pending involving anyone who purchased live events from Trump University throughout the United States beginning, Jan. 1, 2007.

Lead plaintiff Tarla Makaeff sued Trump and Trump University, claiming she spent $60,000 for real estate programs. But the seminars were nothing more than infomercials, according court papers cited by Courthouse News Service.

Trump maintains that the school is merely on “hiatus” and will open again once the litigation is settled, according to a 2012 legal deposition.

The presidential candidate also claimed he could not be held liable for unfair competition or false advertising claims because he personally didn’t make any misrepresentations. But one student said she relied Trump’s promise that he would “hand-pick” instructors.

“You’ll learn inside secrets from me,” Trump claimed in pitches. “This is the next best thing to being my apprentice.” Trump also signed pitch letters to students.

Trump also personally sold the programs. “Just copy exactly what I’ve done and get rich,” he said in promotional materials, according to Schneiderman’s case.

Trump is running as a Republican for the 2016 presidential nomination and is currently leading the field. But he has yet to address the Trump University scandal, or his reliance on bailout capitalism to keep his real estate empire afloat.

For more on the presidential race, be sure to follow IM on Twitter.


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