Decision Expected Soon In Florida Golf Course Suit Involving Trump

Jan 9, 2017
Originally published on January 9, 2017 8:31 am
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STEVE INSKEEP, HOST:

He may have a country to run in less than two weeks, but President-elect Trump has some unfinished business in Jupiter, Fla. A federal judge there will soon rule in a lawsuit involving Trump National Golf Course. Some club members are suing Mr. Trump for refusing to return their deposits. NPR's Greg Allen looks at Trump's long-running role in this and other court battles.

GREG ALLEN, BYLINE: Trump owns more than a dozen golf courses, including Trump National Jupiter Golf Club. The club was in the spotlight last spring when Trump stopped by during his primary race.

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UNIDENTIFIED MAN: The next president of the United States, Mr. Donald J. Trump.

(CHEERING)

ALLEN: Trump was eager to plug the club located just north of Palm Beach.

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DONALD TRUMP: It's a Jack Nicklaus signature course, and it's a great, great resort and place. And we have a lot of our members here, I see. And...

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TRUMP: ...We love our members.

ALLEN: But that's a love not shared by all the members of Trump's club. From the club's entrance here, members drive under live oaks and palm trees to a luxurious reserve that's off-limits to the public. And behind the club's gates, Trump and dozens of his club's members are involved in a long-running legal dispute. It began in 2012 after Trump bought the property from Marriott Vacations Worldwide.

He paid just $5 million, a bargain price. But as part of the deal, he had to assume some $40 million in debt due to members who, when they bought into the country club, put down refundable deposits. Michelle Tanzer, a lawyer who specializes in golf clubs and their membership plans, says for Trump, those refundable deposits were a problem.

MICHELLE TANZER: It's because it is also known as a loan. And if the member stays a member of the club for the full term, which is generally 30 years, then the club is obligated to pay the membership deposit back.

ALLEN: If members want out early, they can get their deposits back - deposits that were as high as $200,000 - but only after the club finds new members to take their places. When Trump bought the club, lots of members, at least 150, wanted out. Trump said anyone who decided to stay on the resignation list would have to continue to pay dues but would be barred from the club until a new member was found. Disgruntled members said he unfairly changed the deposit rules, so they filed a class-action lawsuit.

Last year, a federal judge in Miami heard the case. Because a ruling is pending, members and their lawyers aren't giving interviews. But win or lose, Trump's hardball business tactics have already been successful. More than half of the members who originally wanted out have taken their names off the resignation list, removing tens of millions of dollars in liabilities from the Jupiter club's balance sheet. This is just one of many lawsuits Trump remains entangled in as Inauguration Day approaches.

When he becomes president, Trump will be nominating judges to the federal bench and have influence and authority that makes him an even more intimidating legal opponent than before. But Steven Lubet, a law professor at Northwestern University, says legally speaking, there's no conflict in Trump's role as president and litigant. It's because of a legal principle known as the rule of necessity.

STEVEN LUBET: Which says that if every judge is potentially disqualified for some reason, then no judge is disqualified for that reason.

ALLEN: The U.S. Supreme Court dealt with this issue in 1997, when President Bill Clinton was named in a sexual harassment lawsuit filed by Paula Jones. The court ruled that a sitting president doesn't have immunity in lawsuits unrelated to the office. But then again, there's never been a president as litigious as Trump. Just last week, he was deposed in another suit, this one involving celebrity chef Jose Andres in a dispute over a restaurant at Trump's new hotel, just blocks from the White House. Greg Allen, NPR News. Transcript provided by NPR, Copyright NPR.