They asked the court for more time to analyze the impact of the NAR’s proposed rule change, which would prohibit MLSs from displaying commissions offered to buyer’s agents, on their proposed settlement.
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Plaintiffs and Multiple Listing Service defendants in a major antitrust commission lawsuit are asking a federal court for more time to respond to the U.S. Department of Justice’s filings in the case as the National Association of Realtors proposes a nationwide commission settlement.
On March 20, plaintiffs Jennifer Nosalek, Randy Hirschorn and Tracey Hirschorn and defendant MLS Property Information Network (MLS PIN) asked the U.S. District Court for the District of Massachusetts to change the deadline for them to respond to a statement of interest filed by the DOJ. The case occurred on February 15.
In the filing, the federal agency rejected the rule changes in the proposed settlement between the plaintiffs and MLS PIN, instead calling for “an injunction prohibiting sellers from offering commissions to buyer’s brokers,” thereby promoting competition and innovation among buyers. Broker, as buyers will have the right to negotiate directly with their own broker.
The DOJ stressed that the change would not necessarily force buyers to pay commissions out of pocket, as buyers can include in their home purchase offer a requirement that the seller pay the buyer’s agent out of the proceeds of the home sale.
On February 22, a week after the DOJ filing, NAR broke its silence on the agency’s proposal, saying the proposal would hurt consumption by making it more costly for homebuyers to obtain competent representation and reduce access to fair housing. interests of the person. Three weeks later, NAR settled a case called Sitzer | Burnett and others agreed to a new rule that would ban compensation provided by listing brokers to buyer’s brokers from appearing in the MLS, to take effect in mid-July.
exist Wednesday’s filingthe plaintiffs and MLS PIN acknowledged that the court on March 11 granted their request to file separate responses to the DOJ’s filings by March 28, the date for oral arguments before the Multidistrict Litigation (MDL) panel.
On Dec. 27, attorneys for plaintiffs in other similar lawsuits including Gibson and Umpa asked the U.S. Judicial Panel on Multidistrict Litigation to consolidate any cases nationwide making similar claims, including the Nosalek case, for trial in U.S. District Court . Western District of Missouri. The court was the first to hear one of the commission lawsuits, Sitzer|Burnett, which resulted in a multibillion-dollar verdict against the home seller plaintiffs.
However, in documents filed Wednesday, MLS PIN and the plaintiffs said they need more time in light of the March 15 NAR settlement and proposed submitting a status update to the court seven days after the MDL panel’s ruling, which they expect will be April. This status update will include a proposed deadline for filing responses to the DOJ filing.
“The NAR Settlement Agreement…contains a rule change regarding the ability of MLS entities to list seller commission offers to buyer’s brokers,” attorneys for MLS PIN and the plaintiffs wrote.
“This rule change is different from the rule change that plaintiffs and MLS PIN negotiated in this lawsuit. Because many Massachusetts real estate agents are members of the NAR and therefore may be affected by different rules, the parties need to consider the proposed NAR rule change impact on this settlement.”
They said they still need time:
• Discuss with each other “whether and to what extent any changes to their settlement would be appropriate”
• Discussions with the Department of Justice “to determine whether any additional changes would address the issues raised in its statement of interest,”
• Discuss with the NAR settlement parties “a coordinated approach to resolving outstanding actions”; and
• Any contemplated changes must be approved by the MLS PIN Board of Directors.
Under the originally proposed settlement, the MLS PIN would eliminate the requirement that home sellers provide indemnification to buyer’s agents; require listing brokers to notify sellers that they are not required to provide indemnification to buyer’s agents and that they can if buyer’s agents demand indemnification reject; and would clarify that if the seller makes an offer to the buyer’s agent and the buyer makes a counteroffer, the commission will be negotiated between the seller, buyer, seller’s agent, and buyer’s agent.
Just as the Federal Commission Suits Moehrl and Sitzer | Burnett and Nosalek seek a class-action lawsuit, claiming that sharing commissions between listing brokers and buyer’s brokers drives up sellers’ costs, is a conspiracy to restrain trade, and violates the X.C. Mann Antitrust Law.
However, the Nosalek case differs from many other lawsuits in one important respect: NAR was not named as a defendant, while MLS PIN was. MLS has 60 full-time employees and approximately 46,000 subscribers in six New England states and New York.
The Nosalek case joins a growing number of antitrust lawsuits across the country challenging a rule that requires listing brokers to provide blanket, one-sided compensation to buyer’s brokers for filing listing applications on the MLS. Most of the lawsuits have focused on this version of the NAR’s rule, known as the Collaborative Compensation Rule or Participation Rule, which is in effect for all real estate agent-affiliated MLSs across the country and thus attracted the attention of the DOJ.
Read Wednesday’s motion:
Send an email to Andrea V. Brambila.
