A New York appeals court on Tuesday revived a fraud claim the state attorney general brought against Trump University, a for-profit investment program.
The ruling came in a case New York Attorney General Eric Schneiderman filed against the Trump venture in 2013.
The state accused the venture of misleading students into paying for programs they thought came from a licensed university, according to Tuesday's decision by the Appellate Division, First Department in Manhattan.
The New York Attorney General claimed the Trump venture misrepresented that Trump himself handpicked instructors, the decision said. He also accused Donald Trump of having a significant role in Trump University's operations.
The lawsuit accused the venture of using "bait and switch" tactics to steer enrollees into higher cost seminars.
Trump was notified by the state in 2005 that his Trump Entrepreneur Initiative -- known as Trump University until 2010 -- was in violation of state education law.
In 2014, a judge ruled that it was undisputed that he never complied with the licensing requirements.