Scarinci Hollenbeck, LLC, LLCScarinci Hollenbeck, LLC, LLC

Firm Insights

NY Attorney General Wants to “Fire” Donald Trump from Education Industry

Author: Dan Brecher

Date: September 3, 2013

Key Contacts

Back

While Donald Trump is well known for his antics on the air and in the boardroom, he may soon be spending some time inside a courtroom. New York Attorney General Eric T. Schneiderman recently announced that his office filed a $40 million fraud lawsuit against Trump and his business education venture, The Trump Entrepreneur Institute.

According to the suit, The Trump Entrepreneur Institute, formerly known as Trump University LLC, operated as an unlicensed educational institute from 2005 to 2011 in violation of New York education law. While State Education Department officials allegedly informed Trump, in 2005, that his school lacked the proper license and failed to meet the legal definitions of a university, Trump did not change its name until 2010.

The suit also alleges that Trump University reinforced the misperception that it was a “real university” by employing the signs, symbols, and terminology used by traditional colleges and universities. For instance, payments were referred to as “tuition,” instructors were called “faculty,” and completing course work resulted in “graduation.”

The complaint also alleges that Trump University misled students through its marketing and advertising campaigns. False claims cited in the lawsuit include that instructors were “handpicked” by Donald Trump; students would be taught Donald Trump’s very own real estate strategies and techniques; students would learn “everything [they] need[ed] to know” to become successful real estate investors; and students would receive access to private sources of financing. The complaint also maintains that instructors used free or low cost seminars to pitch consumers to enroll in increasingly expensive programs, including Trump Elite mentorship programs costing $10,000 to $35,000.

“Mr. Trump used his celebrity status and personally appeared in commercials making false promises to convince people to spend tens of thousands of dollars they couldn’t afford for lessons they never got,” Schneiderman said in a press release.

The lawsuit seeks full restitution on behalf of more than 5,000 consumers who signed up for the classes, disgorgement of profits, as well as costs, penalties and injunctive relief prohibiting deceptive acts and practices going forward.

Not surprisingly, Trump responded by sharply criticizing the allegations and Attorney General Schneiderman personally. He characterized the suit as baseless, citing the university’s 98 percent satisfaction rate. He also alleged that Schneiderman’s actions are politically motivated.

Whether or not that occurred here, the lesson is that businesses need to be aware of, and timely compliant with, their licensure requirements and to make sure that their promotional statements are not demonstrably false.

If you have any questions about this case or would like to discuss the legal issues involved, please contact me, Dan Brecher, or the Scarinci Hollenbeck attorney with whom you work.

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Scarinci Hollenbeck, LLC, LLC

Related Posts

See all
Public Allegations, Unfinished Investigation: What New Jersey Businesses Should Do Next post image

Public Allegations, Unfinished Investigation: What New Jersey Businesses Should Do Next

When facing public allegations of wrongdoing, companies should not let the speed of the public conversation dictate the speed of an investigation. An investigation designed to confirm a preferred narrative rather than establish the facts can create serious problems later, particularly if litigation, regulatory scrutiny, or employment claims follow. Key Takeaways When public allegations surface […]

Author: Sean M. Pena

Link to post with title - "Public Allegations, Unfinished Investigation: What New Jersey Businesses Should Do Next"
BESS Interconnection: Managing Grid, Cost, and Schedule Risk post image

BESS Interconnection: Managing Grid, Cost, and Schedule Risk

For battery energy storage system (BESS) developers, securing equipment and site control is only part of the development equation. A project must also connect to the electric grid, and increasingly, BESS interconnection is one of the biggest sources of schedule, cost, and contractual risk. Key Takeaways This article is Part 3 of our Battery Storage […]

Author: Nicholas Wall

Link to post with title - "BESS Interconnection: Managing Grid, Cost, and Schedule Risk"
Navigating Director and Officer Liability in Times of Financial Distress post image

Navigating Director and Officer Liability in Times of Financial Distress

Director and officer liability increases sharply when a company is in financial distress. Decisions that would draw little attention in a healthy business can later be challenged by creditors, shareholders, bankruptcy trustees, and regulators as breaches of fiduciary duty, fraudulent transfers, or oversight failures. Understanding where that exposure comes from, and how to manage it, […]

Author: Michael Mietlicki

Link to post with title - "Navigating Director and Officer Liability in Times of Financial Distress"
Before You Buy: Managing Real Estate and Permitting Risk for BESS Projects in New York and New Jersey post image

Before You Buy: Managing Real Estate and Permitting Risk for BESS Projects in New York and New Jersey

For developers pursuing battery energy storage system (BESS) projects, finding the right property is only the beginning. BESS site selection is as much a legal and transactional exercise as a real estate decision, with risk analysis central to the project’s ultimate success. Key Takeaways The core questions for BESS site selection in New York and […]

Author: Nicholas Wall

Link to post with title - "Before You Buy: Managing Real Estate and Permitting Risk for BESS Projects in New York and New Jersey"
What Business Owners Get Wrong Before Meeting a Litigation Attorney post image

What Business Owners Get Wrong Before Meeting a Litigation Attorney

What should you expect when meeting a litigation attorney about a business dispute? You should expect to describe the dispute in your own words, hand over the most important documents, flag any deadlines or immediate threats, and leave with a clearer picture of the problem, what information is still needed, and the likely next steps. […]

Author: Michael Mietlicki

Link to post with title - "What Business Owners Get Wrong Before Meeting a Litigation Attorney"
Arbitration vs. Litigation vs. Mediation: What New Jersey Businesses Should Know Before Signing a Contract post image

Arbitration vs. Litigation vs. Mediation: What New Jersey Businesses Should Know Before Signing a Contract

Arbitration resolves disputes privately before an arbitrator whose decision is usually final, while litigation resolves them in court with full rights of appeal. Whether a business ends up in arbitration or litigation is often decided when it signs the contract, long before any dispute arises. Key Takeaways When facing a contract dispute, carefully consider your […]

Author: Graham Staton

Link to post with title - "Arbitration vs. Litigation vs. Mediation: What New Jersey Businesses Should Know Before Signing a Contract"

No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.

Sign up to get the latest from our attorneys!

Explore What Matters Most to You.

Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.

Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.

Let`s get in touch!

* The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form. By providing a telephone number and submitting this form you are consenting to be contacted by SMS text message. Message & data rates may apply. Message frequency may vary. You can reply STOP to opt-out of further messaging.
“If you would like to submit a file, please email it directly to info@sh-law.com.

Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!