Facts
- Purchasers of Trump University real-estate seminars brought a putative class action alleging deceptive marketing practices in selling a three-day “fulfillment” seminar and “Trump Elite” programs.
- Plaintiffs alleged Defendants used uniform advertising and promotions to induce purchases through three central representations: (1) Trump University was an “accredited university”; (2) instruction would come from real-estate “experts, professors and mentors” hand-selected by Donald J. Trump; and (3) students would receive one year of expert support and mentoring.
- The court previously certified a class and subclasses under Rule 23(b)(3) based on those alleged common misrepresentations.
- Defendants moved to decertify, arguing that, under Comcast, Plaintiffs’ proposed “full-refund/full-recovery” damages approach failed to match the liability theory and made the case unmanageable for class treatment.
- Plaintiffs filed an unopposed request asking the court to clarify the scope of the earlier certification order, including the class/subclass contours and the misrepresentations at issue.
Issues
- Whether the class should remain certified as to liability notwithstanding a Comcast-based challenge focused on damages methodology.
- Whether the class should remain certified as to damages where Plaintiffs sought classwide recovery using a full-refund model.
- Whether the court should clarify the scope of the prior certification order concerning the class/subclasses and the misrepresentations to be tried on a class basis.
Decision
- The court denied the motion to decertify as to liability, holding that common questions predominate on whether Defendants made uniform, actionable misrepresentations.
- The court granted the motion to decertify as to damages, concluding Plaintiffs’ full-refund model did not satisfy Comcast and that damages would require individualized determinations.
- The court granted Plaintiffs’ unopposed application to clarify the class certification order, restating the certified class/subclasses and the uniform representations defining the liability case.
Legal Principles
- A Rule 23(b)(3) class may remain certified for liability where alleged misrepresentations are standardized and liability can be resolved using common evidence, even if damages present individualized questions.
- Under Comcast, a class seeking damages must present a methodology consistent with the liability theory and capable of classwide measurement; a model that risks awarding amounts untethered to the alleged wrongdoing is insufficient.
- A full-refund damages theory may fail predominance where class members may have received varying value from the product or service, making restitution or damages dependent on individualized valuation and experience.
Conclusion
The court preserved class treatment for adjudicating whether Defendants’ alleged uniform misrepresentations were unlawful, but decertified the class for damages because Plaintiffs’ proposed classwide full-refund model did not reliably measure only harm attributable to the challenged conduct and would require individualized valuation inquiries.