Texas broker piles on to mandatory membership challenges
A new complaint, like others filed in Michigan and Pennsylvania, claims that requiring association membership as a precondition for MLS access is monopolistic.
The backlash over mandatory association memberships continues to grow with a Texas broker filing a new lawsuit against NAR and three other organizations.
The latest case: Luz De Amor Eytalis filed a complaint on Nov. 25 in the U.S. District Court for the Northern District of Texas, alleging violations of federal civil and antitrust laws. The complaint names the National Association of Realtors, the Texas Association of Realtors, Wichita Falls Association of Realtors and Paragon MLS Connect.
In her filing, Eytalis claims the three associations and the MLS engaged in monopolistic practices that unlawfully restrict competition in the real estate market by requiring brokers join multiple associations as a precondition for MLS services. Eytalis also called the practice discriminatory.
"These practices disproportionately affect minority professionals and have resulted in inequitable enforcement of rules and exclusion from fair competition in the real estate industry," the filing states.
Eytalis is a licensed real estate broker in Wichita Falls, Texas, and is requesting policy changes and compensatory damages of no less than $5.8 million.
Momentum is building: Cases challenging mandatory membership rules are currently active in Michigan and Pennsylvania, while a California case was dismissed earlier this month but could be refiled next month. Like the Texas complaint, the Pennsylvania case alleges discrimination in addition to antitrust violations.
The lawsuits tie into the August practice changes stemming from NAR's settlement, specifically the removal of offers of compensation from MLS platforms. That move "greatly diminished any value" offered by associations, the Michigan plaintiffs argued in their original complaint, which they amended last week.
A threat to NAR's three-way agreement: The outcome of the cases could ultimately erode NAR's three-way agreement, the idea that real estate professionals must be dues-paying members of NAR and their local and state associations to access the multiple listing service.
Some associations appear to be preparing for that scenario. Earlier this month, Phoenix Realtors unveiled MLS Choice, a lower-cost subscription option that provides MLS access without requiring membership in a Realtor association.