In a landmark ruling out of Kansas City, the National Association of Realtors, HomeServices of America, and Keller Williams have been held accountable for collaborating to inflate commission rates. The contention centered around NAR’s Clear Cooperation Rule, a rule highlighted in the Sitzer/Burnett buyer broker commission lawsuit.
The implications are staggering. Damages have been set at $1.78 billion, but the defendants could face up to a colossal $5.36 billion when factoring in treble damages. This pivotal ruling may also pave the way for similar lawsuits to emerge in other states.
After sifting through two weeks of intense testimonies, the jury concluded that despite having antitrust rules set, the accused brokerages and trade group willingly breached their own regulations to uphold inflated commission rates.
However, this isn’t the end of the road. Judge Stephen Bough, overseeing the proceedings, will deliver his final judgement, which will decide the fate of the verdict. Potentially, Bough might implement a national ban on the cooperative compensation rule within multiple listing services. Such a move could disrupt the dynamics of agent commissioning. On the other hand, he might let some elements of the rule persist with minimal modifications.
The origins of this antitrust class action lawsuit date back to 2019. Interestingly, two initial defendants, RE/MAX and Anywhere, opted for settlements earlier this September.
Unsurprisingly, the verdict was met with swift rebuttals from the defendants. The NAR, through their spokesperson Mantill Williams, revealed plans to challenge the jury’s decision and will push for a reduction in damages. Williams maintained NAR’s stance, emphasizing their commitment to transparency, fairness, and consumer interests. He also hinted at a long road ahead before this case finds its conclusion.
Darryl Frost, representing Keller Williams, expressed dissatisfaction with the court’s decision to withhold what they believe to be pivotal evidence. He affirmed Keller Williams’ belief in their compliance with Missouri’s cooperative compensation laws, hinting at possible avenues of appeal in the future.
HomeServices too showed their intent to appeal, emphasizing the potential challenges this verdict poses for buyers and sellers in an already intricate real estate market.
In their concluding statement, HomeServices championed the cooperative compensation rule, underlining its role in aiding millions to achieve the dream of homeownership with professional guidance.
