Trump University

Transcript

The episode as narrated, with years shown as numerals. Archival tape is quoted from the official record.

0:00 Cold open: one word

In 2005, New York's Education Department wrote to Donald Trump about one word in his new company's name. University. The state said it couldn't use that word without a charter, or operate in New York without a license. Welcome to The Dirtpile.

One scandal at a time. File two: Trump University.

0:25 The school and the lawsuits

Trump University sold real-estate seminars and mentorships, some costing upward of twenty thousand dollars. In 2010, after the state demanded it drop that word, it became the Trump Entrepreneur Initiative. Former students had already filed a federal class action. In 2013, New York's attorney general sued the company and Trump.

So what did a court actually decide, and what did a settlement simply end?

0:53 The claims and the defense

The suits alleged fraud, including promises of instructors handpicked by Trump. Trump defended the school, saying more than ten thousand students had filled out surveys giving the courses high marks. The attorney general alleged students were pressured into favorable reviews.

1:08 What a court decided

In October 2014, a New York judge ruled the company had operated as an unlicensed school. Its reasoning held Trump personally liable on that claim, though the formal order named only the company. No penalty was ever set by judgment. That was a licensing violation, not a finding of fraud.

On fraud, that judge and a state appeals court said key facts were in dispute. No court ever found that Trump University committed fraud.

1:36 "Won't out of principle"

In February 2016, Trump posted that the school had a ninety-eight percent approval rating. He added, "I could have settled but won't out of principle!" He won the presidency on November 8.

1:48 The settlement

Ten days later, and ten days before a federal trial, a settlement was announced. Twenty-five million dollars: twenty-one million for former students, four million for New York's attorney general. The payer of record was the Trump Entrepreneur Initiative, the school's successor company. The agreement states it is not an admission of any kind.

The next day, Trump wrote in a post, "I settled the Trump University lawsuit for a small fraction of the potential award because as President I have to focus on our country."

2:19 Approval and appeal

Approving the deal, the federal judge conservatively estimated that claimants would recover over eighty percent of what they paid. Approving a settlement as fair is not a ruling on the fraud claims. A federal appeals court upheld it in 2018. A settlement can end a case without ever answering it.

This file is business history, not proof of what he later did in office.

2:46 Side by side

The record leaves these side by side. A licensing violation found, and fraud never tried. Twenty-five million dollars, and no admission. His ninety-eight percent rating, and alleged pressure for good reviews.

A post saying he wouldn't settle, and one saying why he did.

3:07 Our question

Here's our own question, not an official finding. When a case settles on the eve of trial, with no admission, how does the public learn whether the claims were true? This is The Dirtpile. One scandal at a time.