DOJ’s Sunday filing raises issues with NAR deal
The agency takes no position on the settlement’s approval but says it’s not an antitrust shield — and expresses concern over buyer agent agreements.
The U.S. Department of Justice has weighed in on the NAR deal to settle commissions lawsuits, and while it isn't taking an official position on whether it should be approved, the agency wants the judge to make clear that the deal won't stop future enforcement over antitrust violations.
The DOJ filed its Statement of Interest on Sunday, Nov. 24, two days before the final hearing for the $418 million NAR settlement with home sellers in the Sitzer/Burnett case in U.S. District Court's Western District of Missouri. The statement asked that if the court approves the settlement, it should clarify that using these new NAR polices does not shield NAR or other potential defendants from future enforcement by the DOJ.
The settlement "does not address whether the proposed settlement prevents and restrains current antitrust violations, remedies past violations, or contains revised policies and practices that comply with the antitrust laws," the filing stated.
A warning from the DOJ: The agency also raised a concern about buyer agent agreements, saying the provision that requires buyers and brokers to make written agreements before home tours "may harm buyers and limit how brokers compete for clients."
"It bears a close resemblance to prior restrictions among competitors that courts have found to violate the antitrust laws in other proceedings and could limit — rather than enhance — competition for buyers among buyer brokers," according to the filing.
The DOJ offered some suggestions to fix this issue: Either eliminate the provision altogether, or make clear that the settlement does not create any immunity of defense under the antitrust laws.
"Alternatively, the Court could clarify that approval of the settlement affords no immunity of defense for the buyer-agreement provision," according to the statement.
Why this matters: This warning about buyer agent agreements could be a significant issue, since they are currently being used by real estate agents across the country, particularly since the Aug. 17 NAR policy changes went into effect.
Clarifying that the buyer agent agreement does not preclude future antitrust investigations is one thing, but eliminating the provision could create more confusion for agents who are already trying to understand exactly when an agreement must be signed.