Fathom settles commissions lawsuit for $2.95 million
The cloud-based brokerage will pay three installments into the settlement fund over the next two years, pushing the fund total past the $1 billion mark.
Another national brokerage company has reached a settlement in the buyer agent commission lawsuits.
On September 16, Fathom Realty announced that it will pay $2.95 million over the next two years and has agreed to adhere to the rule changes made by the National Association of Realtors as a result of its settlement.
Fathom was named along with dozens of other companies and associations last December in a copycat lawsuit brought by Texas home builder QJ Team LLC and Five Points Holding. The case was filed in the U.S. District Court for the Eastern District of Texas.
Because Fathom's sales volume in the years prior to the NAR settlement exceeded the $2 billion threshold, the firm was one of 90-plus brokerages left out of the March 15 deal. According to the Real Estate Almanac, Fathom achieved more than $16 billion in sales volume in 2022.
The brokerage company will pay $500,000 into the settlement fund once the deal is approved by the court, followed by another $500,000 in October 2025 and $1.95 million by October 2026.
What Fathom had to say: Marco Fregenal, CEO of Fathom Holdings, said the settlement was not an admission of liability, but he echoed sentiments expressed by NAR and major brokerage leaders when announcing the decision to settle, stating that the firm was ready to move past the uncertainty, cost and distraction of litigation.
"We believe that this settlement represents the most prudent way forward, enabling our agents to focus on their clients without the distraction of prolonged litigation," Fregenal said in a news release.
"Entering into a settlement now has the benefits of avoiding ongoing legal fees and removing the demand on the executive team's time, allowing us to focus on growing our business and ensuring our agents continue to have the opportunity to excel in their service to clients."
Settlement fund status: With this agreement in place, the overall settlement fund will cross over the $1 billion mark. Court documents filed last week indicate the fund was at just under $998.38 million prior to this settlement.
Fathom Realty is headquartered in Cary, North Carolina, and is a national, cloud-based real estate brokerage, according to its website. It is part of Fathom Holdings, which has a variety of brands including Encompass Lending, Verus Title and intelliAgent.