New commissions lawsuit filed on the heels of Sitzer/Burnett verdict
After the jury unanimously found for the plaintiffs in the Missouri case, the lead attorney announced he was filing a nationwide suit naming NAR, 7 brokerages.
Key points:
- Michael Ketchmark filed the suit in U.S. District Court immediately following the decision in Sitzer/Burnett.
- The plaintiffs are three Missouri home sellers who are requesting class status for the lawsuit.
- In addition to NAR, Compass, eXp, Redfin and other major brokerages are named as defendants.
KANSAS CITY, Mo. — Wasting no time after a stunning victory, the lead attorney for the plaintiffs in the Sitzer/Burnett trial filed a sweeping, nationwide lawsuit against the National Association of Realtors and seven brokerage companies.
The brokerages named in the new suit are Compass, eXp, Redfin, Howard Hanna Real Estate, United Real Estate, Douglas Elliman and Weichert Realtors.
The new lawsuit was filed by Michael Ketchmark in U.S. District Court in Western Missouri, the same court that concluded the Sitzer/Burnett trial on Oct. 31. The plaintiffs listed in this new class action complaint are Missouri home sellers Don Gibson, Lauren Criss and John Meiners.
In requesting that the lawsuit be granted class action status, the complaint aims to include every home seller in the U.S. who used a listing broker affiliated with the defendants and listed it on an MLS between "Oct. 31, 2019 to present," according to the filing. The complaint did not list a specific damage amount, but stated that damages should provide "appropriate injunctive and equitable relief."
While some of the defendants and scope of the lawsuit differ, the premise of the case is very similar to Sitzer/Burnett. In the filing, the plaintiffs claim that NAR's offer of compensation rule was part of a conspiracy that "forces home sellers to pay a cost that, in a competitive market and were it not for the defendants' anticompetitive restraint, would be paid by the buyer."
NAR spokesman Mantill Williams said in an email the trade association is currently reviewing the new filing, but it appears to them to be a copycat lawsuit.
"We continue to assert that the practice of listing brokers making offers of compensation to buyer brokers is best for consumers. It gives the greatest number of buyers a chance to afford a home and professional representation, while also giving sellers access to the greatest number of buyers," Williams said.
The plaintiffs also accuse the defendants of pushing home sellers to offer inflated or stabilized rates of between 2.5% and 3% for the buyer agent, and using their control of the multiple listing services to achieve their goal.
Ketchmark and the new plaintiffs were likely emboldened by the outcome of the Sitzer/Burnett trial, where a jury spent less than three hours deliberating before finding the defendants in that case — NAR, HomeServices of America and Keller Wiliams — guilty of a conspiracy and awarding nearly $1.8 billion in damages.
"Our goal is to take the message from Missouri across the nation and return the process of selling homes to the fair market and allow people to reap the benefits of technology and to stop this conspiracy from affecting people in our country," Ketchmark said.