Court Deals a Setback to Donald Trump in Fraud Case Against Trump University

Donald Trump is facing three lawsuits alleging that he defrauded thousands of students through the now-defunct Trump University, and one of those cases moved a step closer to trial on Tuesday.

An appellate division of New York Supreme Court said that the fraud case against Trump could move forward, ruling that the allegations are subject to a six-year statute of limitations. Trump’s lawyers had argued that there was a three-year statute of limitations, which would have made it difficult if not impossible to prosecute most of the allegations.

Attorney General Eric T. Schneiderman, who filed the lawsuit against Trump in 2013, called the court’s order “a clear victory in our effort to hold Donald Trump and Trump University accountable.”

“As the state’s chief law enforcement officer, my job is to see that perpetrators of fraud are brought to justice. We look forward to demonstrating in a court of law that Donald Trump and his sham for-profit college defrauded more than 5,000 consumers out of millions of dollars,” Schneiderman said in a statement.

A spokeswoman for Trump’s campaign did not immediately respond to a request for comment Tuesday afternoon.

Alan Garten, general counsel for the Trump Organization, said he intends to appeal the ruling to a higher court. “The decision contradicts and is inconsistent with three of the appellate division’s own rulings,” he said. “We think it’s ripe for an appeal.”

Schneiderman’s complaint seeks $40 million in restitution on behalf of students who say that Trump University — which was not a university at all, but a series of real-estate workshops held in hotel ballrooms across the country — bilked them of thousands of dollars.

A judge in the New York case ruled last year that Trump is personally liable for illegally operating a university without a proper license. But the judge also ruled that the statute of limitations prevents Schneiderman from seeking restitution for most of Trump University’s students, a decision Schneiderman appealed and won. Whether the university defrauded students and how much Trump might owe in damages are yet to be decided.

Approximately 80,000 people attended Trump University’s free introductory seminars, according to court documents. About 9,200 of them went on to pay $1,495 for three-day seminars, and nearly 800 paid up to $35,000 for packages that included mentorships and workshops.

Instead of a fast route to easy money, some Trump University students say they found generic seminars led by salesmen who pressured them to invest more cash in additional courses. The students say they didn’t learn Trump’s secrets and never received the one-on-one guidance they expected.