Two consumers filed a class-action lawsuit in Cook County Circuit Court. Unlike similar cases, the latest case seeks to represent both buyers and sellers and names only Baird Warner as a defendant.
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The long list of commission lawsuits just got a little longer thanks to a unique new case filed by two consumers in Illinois.
The new case was filed in late February and includes two plaintiffs: Mary Maslanka and David Freifeld; David Freifeld bought and sold properties in the Chicago area in 2019. Both plaintiffs sold a home in the Chicago area in 2012. They used the brokerage firm Baird & Warner, which is named as the sole defendant in the case, to handle their trades.
Inman has reached out to Baird Warner and will update this story with any comment from the company.
The naming of a single defendant is atypical for delegated litigation; high-profile cases such as Sitzer | REALTORS ASSOCIATION.
The new Maslanka case — commission lawsuits are often named after their lead plaintiffs — is also unique in several other ways. On the one hand, the lawsuit, filed in Cook County Circuit Court in Illinois, accuses Baird-Warner of violating state laws, including the Illinois Antitrust Act and the Illinois Consumer Fraud and Deceptive Business Practices Act. The complaint lists four counts against Baird & Warner.
On the other hand, other Commission lawsuits have been filed in federal court and argue that the defendants violated federal antitrust laws.
Despite this difference, much of the outline of the case is similar to other Commission proceedings. For example, the indictment accuses Baird Warner of engaging in “a conspiracy to perpetuate anticompetitive practices.” The National Association of Realtors is not named as a defendant in the lawsuit but is described in the complaint as an “accomplice.” The complaint alleges that NAR and Baird & Warner jointly “implemented anticompetitive rules that directly harmed homebuyers, including requiring that a certain portion of a home’s sales price be allocated to buyer’s agent commissions.”
This language is very similar to other commission lawsuits that have challenged the practice of having the seller’s agent seek indemnification from the buyer’s agent.
The Maslanka lawsuit also differs from other cases in one way: It seeks class-action status on behalf of homebuyers and sellers. According to the complaint, the buyer and seller categories include anyone in Illinois who used Baird & Warner agents to conduct transactions on properties listed on the NAR-affiliated MLS dating back to 1996. “There are at least tens of thousands, if not hundreds of thousands, of members in each category,” the complaint states.
Most other cases attempt to represent only buyers or sellers. For example, Sitzer, Moehrl and other cases were brought by home-selling groups opposed to paying commissions to buyers’ agents. Batton 2, on the other hand, was initiated by homebuyers.
While there are differences between the various cases, commission lawsuits overall have become one of the defining events in the real estate industry in recent times and have fueled significant speculation about coming chaos. Several companies, including Anywhere, RE/MAX and Keller Williams, have reached settlements, but new cases attracting new companies and trade groups emerge almost weekly.
In the Maslanka lawsuit, the plaintiffs ultimately sought a jury trial and various damages, including “an amount equal to three times the actual damages under Illinois antitrust law.”
Read the full Maslanka complaint here:
Email Jim Dalrymple II
