It seems unlikely that a relatively new federal trial judge from San Diego, Gonzalo Curiel, would ever imagine in his wildest dreams he would be dragged into the national media spotlight in the U.S. Presidential election.
But that’s what happened when presumptive Republican presidential nominee Donald Trump called Curiel, who was born in Indiana, a Mexican and a “hater” who could not be fair in Trump’s long-running lawsuits over his real estate investment seminars known as Trump University.
The judge, on the bench since October 2012, quickly became the object of national scrutiny in March. And Trump has been called a bigot by both political camps for suggesting Curiel couldn’t do his job because of his nationality..
An examination of Curiel’s rulings in both the Trump University lawsuits shows Curiel has treated Trump evenhandedly, giving him some wins while also doling out setbacks, even before the judge became a campaign football.
Two separate, but parallel, class actions were filed. First in 2010, the first case named Trump University alleging a number of business injuries, false advertising and financial elder abuse (because many “students” were seniors). The second case, filed in 2013, named Trump personally and accused him of a civil racketeering conspiracy to defraud investors in his real estate seminars.
Back in 2008, a friend talked Tarla Makaeff, a fashion designer from Corona del Mar, into spending $1,500 to sign up for the Trump University real estate investment classes.
It promised “insider success secrets” of the real estate mogul. But she quickly found the one-year apprenticeship program was a three-day infomercial that pressured students to spend as upwards of $35,000 or more on a “Gold Elite” program to make millions in real estate. Those opening days included excursions to visit Home Depot and a tour of properties, led by people who recommended deals in which they stood to profit personally.
(Remember, this was 2008, the year of the mortgage market crash.)
Makaeff ultimately spent $60,000. She said in court depositions that the high pressure sales were like “a brainwashing scheme.” You didn’t know you’d been taken until it was over.
She began complaining that she wasn’t getting her money’s worth and asked for a refund in 2009. The university refused. She complained to the Better Business Bureau and accused the school of “bait and switch” tactics.
Ultimately, she filed the class action lawsuit in federal court in 2010 claiming false advertising, negligent misrepresentation, fraud, financial elder abuse and unfair business practices. Her lawsuit was not assigned to Curiel (again, he wasn’t appointed until 2012), but to Judge Irma Gonzalez, a Hispanic born in Palo Alto, California, not Mexico. She was a former federal prosecutor appointed by Republican President George Bush.
After Makaeff sued things got really nasty.
Trump University countered by suing Makaeff personally for defamation and asking for $1 million in damages in an effort to shut her up by embroiling her in expensive and time-consuming litigation.
In California, these types of retaliatory lawsuits are know as SLAPPs, Strategic Lawsuits Against Public Participation, because they are intended to silence opposition and are considered a First Amendment violation.
California law has a special protection against such harassing lawsuits, known as anti-SLAPP protection. It is a powerful tool. It allowed Makaeff to ask the judge to throw out the Trump University defamation claim.
The anti-SLAPP motion also gave Makaeff the right to an immediate appeal if Gonzalez refused to dismiss the claim and the right to recover all her attorney fees if she won.
Gonzalez rejected Makaeff’s motion to chuck the defamation claim in 2013, holding that Trump University wasn’t a “public figure” and therefore could more easily show the probable validity of a defamation claim.
Makaeff then went to the 9th U.S. Circuit Court of Appeals, which overturned Gonzalez saying Trump University’s aggressive advertising campaigns made it a limited “public figure” and thus making defamation tougher to prove. The SLAPP suit should be tossed, according to the appeals court.
By this time, Curiel had joined the federal bench, appointed by President Obama in 2012. In the usual shifting of cases to fill up a new judge’s caseload, Curiel got assigned the Trump University case by Gonzalez in January 2013.
Meanwhile, the appeals court loss didn’t stop Trump’s lawyers, who asked the full 9th Circuit to hold a rehearing before an 11-judge panel. A majority of the 28-judge court refused in November 2013 and the case went back to Curiel.
In June 2014, following the 9th Circuit’s direction, Curiel dismissed the defamation claim against Makaeff.
This began months of haggling over what Makaeff’s lawyers were owed for fighting the defamation claim. Ultimately, Curiel ordered Trump University to pay nearly $800,000 in fees and costs to her lawyers.
Meanwhile, in 2013, Art Cohen had filed a class action accusing Trump of civil racketeering for the high pressure sales and promises to learn Trump’s sales secrets, when Trump had no meaningful involvement in the classes. The suit sought triple damages, an injunction against further live seminars and other damages. It was a potentially expensive proposition for Trump.
Trump lawyers responded in April 2016 that the lawsuit “epitomizes the pervasive abuse of civil RICO.” They argued consumer laws provide full redress of legitimate grievances, but said Cohen elected to use RICO “in an effort to extract punitive money awards and exert undue leverage for settlement.”
Trump asked Curiel to throw out the entire case.
That was two months ago and Judge Curiel has not yet ruled, or even held a hearing on the motion.
By this point Trump was already the leading GOP contender for president and had accused Curiel publicly of bias for not tossing the case.
Then last month, Curiel agreed to a Washington Post request to unseal the Trump University “playbook” with instructions on sales pitches, scripts for engaging students and policies. This came over Trump objections that it was trade secret information.
Curiel pointed out that the entire playbook had been posted online by Politico months earlier, hurting the claim for trade secret confidentiality.
In addition, the 9th Circuit had previously found Trump University a “public figure” in the Makaeff anti-SLAPP appeal further supporting the argument for public release. Lastly, Trump “became the front-runner for the Republican nomination in the 2016 presidential race and has placed the integrity of these court proceedings at issue,” Curiel said. That too, bolstered the argument for public airing to make sure the public could see what’s going on in court.
He ordered the release of the playbook May 27.
That is where the case stands, with a pending motion for summary judgment to toss out the case. To win a summary judgment, Trump must show there are no genuine issues of material fact in dispute, a tough hurdle.
Meanwhile, in the Makaeff Case
Even before getting this far on the Cohen racketeering claims, Curiel juggled motions in the Makaeff case as it chugged along on a separate track.
He faced two major decisions in the case; whether to grant Makaeff class status, allowing her claims to apply to hundreds of other alleged victims of the program, and Trump University’s claim that the entire case should be dismissed.
Despite Trump’s claims Curiel could not be fair to him, the judge – prior to Trump’s rants – issued mixed rulings on both legal questions, giving some ground to Trump University but siding with Makaeff on most.
Curiel granted Makaeff class status in February 2014, but limited it to Trump University enrollees in California, Florida and New York on claims of misleading advertising, unfair business practices and financial elder abuse.
But in a victory for Trump, Curiel refused to grant nationwide class status on claims of fraud and misrepresentation, finding the laws of the various states too diverse and unmanageable as a class action.
Then in September 2015, Curiel refused to allow mass class damages claims, setting individual damage claims as a separate issue to be tried only if Trump University was first found responsible in the liability phase of the trial. Another partial victory for Trump.
Although Trump University shut down in 2010, Makaeff argued that the class was entitled to an injunction because Trump has said publicly and in his 2012 deposition that it could reopen.
Trump testified in a deposition, “Do we plan to start TU again after this lawsuit is won and after we bring the lawsuit against your firm[?]I would say probably yeah.”
But Curiel denied the class the right to an injunction because there was no immediate threat of repeated injury.
In a defeat for Trump, Curiel held class members could receive money damages on a number of grounds, including financial elder abuse.
More significantly, Curiel ruled the class could pursue claims that Trump could be held personally liable as an officer and founder of the school because he authorized the use of his name and image and he reviewed and authorized ads. In addition, Trump personally financed TU and told students he “hand-picked” instructors and mentors, Curiel said.
Earlier this year, Makaeff had apparently had enough of the case and asked to be replaced as the lead plaintiff and another member of the class was picked. The case is now known as Low v. Trump University.
Currently, Curiel has been asked by TU to reconsider the class certification. A trial is not likely any time soon.
In the routine of large and hard-fought class actions, there is nothing unusual in any of Curiel’s rulings. But the process certainly have been an education.
Case: Makaeff (Low) v. Trump University, 10-940;
Cohen v. Trump, 13-2519