NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced a lawsuit on Sunday against Donald Trump and a school associated with the real estate mogul for allegedly engaging in deceptive and illegal conduct.
The Trump Entrepreneur Institute, formerly known as Trump University LLC, operated as an unlicensed educational institute between 2005 and 2011. The school promised to teach Donald Trump's real estate investing techniques to consumers around the U.S. but allegedly misled consumers into paying for expensive courses that failed to deliver.
The lawsuit against Donald Trump, The Trump Entrepreneur Institute and Michael Sexton, the school's former president, alleges the defendants advertised the school with false claims, including the claim that consumers would learn from Donald Trump's handpicked instructors. Donald Trump allegedly did not handpick even one instructor for the seminars and had little to no role in developing the school's curriculum. The school also used the name Trump University without the necessary charter under state law to call itself a university.
"More than 5,000 people across the country who paid Donald Trump $40 million to teach them his hard sell tactics got a hard lesson in bait-and-switch," Schneiderman said. "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. No one, no matter how rich or popular they are, has a right to scam hard working New Yorkers. Anyone who does should expect to be held accountable."
The defendants also allegedly used the three-day seminars to pitch consumers an expensive Trump Elite mentorship program costing between $10,000 and $35,000. Many consumers who paid for the elite mentorship program allegedly did not receive the individual mentor attention that was promised. The defendants also allegedly violated federal consumer protection law by failing to honor consumers' requests to cancel the programs within three business days.
Schneiderman's lawsuit seeks full restitution for the more than 5,000 consumers who took part in the program who paid more than $40 million in total to the school. The lawsuit also seeks disgorgement of profits, penalties and costs and injunctive relief to prevent the allegedly illegal practices in the future.
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