Cohen v. Trump

          ORDER DENYING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT OR, IN THE ALTERNATIVE, PARTIAL SUMMARY JUDGMENT [ECF NO. 180]

          Hon. Gonzalo P. Curiel United States District Judge

         Before the Court is Defendant Donald J. Trump’s (“Defendant”) motion for summary judgment. Defendant’s Motion for Summary Judgment, or in the Alternative, Partial Summary Judgment (“Def. Mot.”), ECF No. 180. The motion has been fully briefed. See Plaintiff’s Response in Opposition to Defendant’s Motion for Summary Judgment, or in the Alternative, Partial Summary Judgment (“Pl. Resp.”), ECF No. 220; Defendant’s Reply in Support of Motion for Summary Judgment or, in the Alternative, Partial Summary Judgment (“Def. Reply”), ECF No. 248. A hearing on the motion was conducted on July 22, 2016. ECF No. 263.

         Upon consideration of the moving papers, oral argument, and the applicable law, and for the following reasons, the Court DENIES Defendant’s motion.

         FACTUAL BACKGROUND

         A. Defendant Donald J. Trump

         Defendant is a real estate magnate, television personality, and author. In 2004, Defendant helped found Trump University (“TU”), a private, for-profit entity offering real estate seminars and purporting to teach Defendant’s “master strategies” for real estate success. Pl. Resp., Ex. E, at 242, 244-50; see also Id. at 191-241. TU began with web-only content in 2005, and shifted to live events in 2007. Plaintiff’s Response to Defendant’s Separate Statement of Undisputed Facts ¶ 13 (“Pl. SSUF”), ECF No. 220-10; Trump Dep. 193:12-18, Def. Mot., Ex. 2.^[1]

         For TU’s live events, consumers were first invited to a ninety-minute Free Preview, which was preceded by an orchestrated marketing campaign using mailed invitations and TU website, radio, and newspaper advertising. See Pl. Resp., Exs. E-F. For example, consumers were sent “Special Invitation[s] from Donald J. Trump” which included a letter signed by Defendant that stated “[m]y hand-picked instructors and mentors will show you how to use real estate strategies.” Pl. Resp., Ex. F. Newspaper advertisements displayed a large photograph of Mr. Trump, stating “[l]earn from Donald Trump’s handpicked expert, ” and quoted Mr. Trump as saying: “I can turn anyone into a successful real estate investor, including you.” Pl. Resp., Ex. E, at 191-207. Similarly, other advertisements displayed large photographs of Mr. Trump and included statements such as “Learn from the Master, ” “The next best thing to being his Apprentice, ” and “Nobody on the planet can teach you how to make money in real estate better than I can.” Pl. Resp., Ex. E, at 242, 244-50; Ex. T, at 321-22. Further, TU advertisements utilized various forms of recognizable signs associated with accredited academic institutions, such as a “school crest” used on TU letterhead, presentations, promotional materials and advertisements, see Pl. Resp., Exs. E, F, I, L, P, as well as language comparing TU with such institutions, see Main Promotion Video, Pl. Resp., Ex. L (“We’re going to teach you better than the business schools are going to teach you and I went to the best business school.”); TU Marketing Guidelines, Pl. Resp., Ex. P, TU-DONNELLY0000016-17 (describing the “Trump University Community” as including “Staff, ” “Faculty, ” “Instructors, ” and “Program Directors (Trump University’s Admissions Department)”; including under “Catch Phrases/Buzz Words” “Ivy League Quality, ” and under “Tone” “Thinking of Trump University as a real University, with a real Admissions process-i.e., not everyone who applies, is accepted”; and encouraging TU employees to “[u]se terminology such as” “Enroll, ” “Register, ” and “Apply”).

         Plaintiffs have provided evidence that Defendant reviewed and approved all advertisements. Trump Dep. 279:18-280:16, Pl. Resp., Ex. D; Bloom Dep. 73:3-74:2, Pl. Resp., Ex. H.

         At the beginning of each Free Preview, a promotional video was played in which Defendant stated:

We’re going to have professors and adjunct professors that are absolutely terrific. Terrific people, terrific brains, successful. . . . The best. We are going to have the best of the best and honestly if you don’t learn from them, if you don’t learn from me, if you don’t learn from the people that we’re going to be putting forward-and these are all people that are handpicked by me-then you’re just not going to make in terms of the world of success. . . . we’re going to teach you better than the business schools are going to teach you and I went to the best business school.

Main Promotion Video, Pl. Resp., Ex. L.

         Individuals were then invited to attend a $1, 495 Fulfillment Seminar. Compl. 15, ECF No. 1. Those who paid for the Fulfillment Seminar were allegedly promised a three-day seminar and one year of expert interactive support. Id. at 20.

         After the Fulfillment Seminar, individuals were invited to sign up for the Trump Elite Program for up to $34, 995. Id. Elite Program participants were allegedly promised unlimited mentoring for an entire year. Id. at 21.

         B. Plaintiff Art Cohen

         Plaintiff Art Cohen (“Plaintiff”) is a businessman and resident of the state of California. Compl. 4. Plaintiff alleges learning about Trump University from a 2009 San Jose Mercury News advertisement. Id. Plaintiff alleges receiving a “special invitation” by mail to attend a Trump University seminar. Id. Drawn in by Defendant’s name and reputation as a real estate expert, Plaintiff attended a free preview event. Id. Plaintiff then paid $1, 495 to Trump University to attend a three-day real estate retreat, where he subsequently purchased a “Gold Elite” program for $34, 995. Id. at 5.

         Plaintiff avers that he would not have paid for any of the TU programs had he known that Defendant had not handpicked the TU instructors, and/or that TU was not a “university.” Id.; see also Cohen Dep., 150:9-151:17, 151:20-152:9, Def. Mot., Ex. 10.

         PROCEDURAL BACKGROUND

         On October 18, 2013, Plaintiff filed a complaint alleging a single cause of action for mail and wire fraud in violation of the Racketeer Influenced and Corrupt Organizations Act (“RICO”), 18 U.S.C. § 1962(c). Compl. On the same day, Plaintiff filed a “notice of related case” requesting that the case be transferred to the undersigned Judge because the present action is related to Low v. Trump University, LLC, No. 10-cv-940-GPC-WVG. ECF No. 3.^[2]

         On February 21, 2014, the Court denied Defendant’s motion to dismiss. ECF No. 21. On November 27, 2014, the Court granted Plaintiff’s motion for class certification. ECF No. 53. The Court noted that Plaintiff’s “theory of recovery under RICO is that Defendant committed ‘fraud and racketeering’ by marketing Trump University ‘Live Events’ as an institution with which he was integrally involved as well as ‘an actual university with a faculty of professors and adjunct professors.’” Id. at 5-6 (citation omitted). The Court certified the following class:

All persons who purchased Live Events from Trump University throughout the United States from January 1, 2007 to the present.^[3]

Id. at 22-23.

         On September 21, 2015, the Court granted in part and denied in part Plaintiff’s motion for approval of class notice and directing class notice procedures. ECF No. 130; Low, ECF No. 419. On November 15, 2015, the opt-out period expired. See Id. at 11.

         On April 22, 2016, Defendant filed the instant motion. Def. Mot., ECF No. 180.^[4] On June 3, 2016, Plaintiff responded. Pl. Resp., ECF No. 220. On June 17, 2016, Defendant replied. Def. Reply, ECF No. 248. A hearing on the motion was held on July 22, 2016. ECF No. 263.

         LEGAL STANDARD

         Federal Rule of Civil Procedure 56 empowers the Court to enter summary judgment on factually unsupported claims or defenses, and thereby “secure the just, speedy and inexpensive determination of every action.” Celotex Corp. v. Catrett, 477 U.S. 317, 325, 327 (1986). Summary judgment is appropriate if the “pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(c). A fact is material when it affects the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).

         The moving party bears the initial burden of demonstrating the absence of any genuine issues of material fact. Celotex, 477 U.S. at 323. The moving party can satisfy this burden by demonstrating that the nonmoving party failed to make a showing sufficient to establish an element of his or her claim on which that party will bear the burden of proof at trial. Id. at 322-23. If the moving party fails to bear the initial burden, summary judgment must be denied and ...