A panel of judges considering whether to consolidate the real estate commission lawsuits into one cited the recent NAR settlement as reason for denying the request.
exist Inman Connect Las Vegas, July 30-August. On January 1, 2024, the noise and misinformation will be cut away, all your big questions will be answered, and new business opportunities will be revealed. join us.
A panel of judges rejected a request to combine a growing number of lawsuits against the real estate industry into a consolidated case, saying in an order Friday that a recent wave of settlements made it premature to comment on the matter.
Some plaintiffs and defendants involved in lawsuits filed by home sellers in multiple court districts across the country have tried to move the lawsuits to a district, but they have not agreed on that. Other plaintiffs and defendants oppose the request entirely.
The motion to consolidate was filed in part to make litigation of the vast list of cases more efficient, with attorneys for dozens of real estate companies defending their clients against accusations that they operate illegally in the real estate industry.
The agreement also comes after the National Association of Realtors (NAR) and other major real estate companies reached an agreement to resolve lawsuits against them. The order and the reaction to it make clear how much of an impact NAR’s settlement will have on the litigation.
In a four-page order issued at noon, the panel’s six judges said they would prefer to let about two dozen cases proceed before ruling on the request.
“Given the broad contours of this new settlement and the evolving landscape of parties’ positions on centralization, we believe it is prudent to deny centralization at this time,” the panel judge wrote.
NAR reached an agreement on March 15 that, if approved, would protect more than 1 million of its 1.5 million members, as well as members of most U.S. brokerage firms, from the threat of existing and future lawsuits.
NAR agreed to pay $418 million to resolve the case and to make sweeping changes to the rules real estate agents follow.
Anywhere Real Estate, RE/MAX and Keller Williams have all reached settlement agreements with the plaintiffs to protect their respective companies. Earlier this week, The Real Brokerage agreed to pay $9.25 million to settle a lawsuit against the brokerage.
HomeServices of America is one of the few companies that has not yet agreed to settle the case in which it is named as a defendant. The company opposed a motion to consolidate the lawsuit into a single multidistrict case.
“Of course, the settlement announced by NAR last month also had a large impact on this decision,” Chris Kelly, executive vice president of HomeServices, told Inman in an email. “However, today’s order does not change HomeServices’ efforts to resolve its involvement.” of potential litigation.”
The panel denied a request to consolidate the existing litigation due to a change in the nature of the litigation resulting from the proposed settlement.
“The settlement is likely to resolve at least some, if not many, of the claims in this litigation,” the panel wrote. “We cannot speculate on how many parties and claims will remain once this and any other settlements are approved.”
The panel did not say how it would rule if a settlement was not reached.
“Upon conclusion of the settlement process, it will become apparent how many remaining claims and parties and the extent to which they overlap, if any, may require formal centralization,” the order said.
Real estate defendants largely support consolidating cases into the Northern District of Illinois or the Eastern District of Texas. The other defendants took no position on the request to join the cases.
Michael Ketchmark, Landmark Sitzer | Burnett Case, the lead attorney representing the plaintiffs in the case, told Inman on Friday that the ruling shows the importance of the recent settlement and could spur more Many brokers resolve their own cases.
“What the federal court did today is that as a result of these settlements, it does not appear that consolidation is needed at this time,” Ketchmark said. “It appears that responsible brokers and companies are looking for ways to reach settlements with NAR and other corporate defendants. If it goes this way, there will be no need for integration. “
Kegemark said he is in active settlement talks with several companies, which he declined to name, citing confidentiality agreements. He called those who have not yet settled as “die-hards” who are more likely to reach a settlement after Friday’s ruling.
“We believe that today, as a result of this court ruling, these people will push to join,” Ketchmark said.
This article will be updated.
Email Tyler Anderson
