DOJ calls out ‘misleading’ claims about its take on Clear Cooperation 

In the footnote of a filing made in a long-running commissions lawsuit, the Department of Justice called statements about its stance on Clear Cooperation "misleading and out of context."

The strong words, easily skimmed past, appeared on page 7 of a March 17 supplemental statement of interest in the MLS PIN case. The footnote was highlighted by an NAR rep in response to a Real Estate News inquiry about the latest developments in the CCP debate.

The DOJ said it "has not taken a position" on whether or not Clear Cooperation is anticompetitive — with some caveats — and calls out industry players who have made claims about the agency's views on the policy. 

What the DOJ says, and doesn't say, about CCP: "Of note, industry participants have made public statements about the Division's purported position on clear cooperation policies that are misleading and out of context," DOJ lawyers wrote in the filing. 

"The Division has not taken a position that such policies standing alone (i.e., without mandated MLS publication of offers of compensation or exceptions benefitting primarily large brokerages) are anticompetitive."

Although the DOJ isn't taking a definitive stand on the CCP, the mention of "exceptions benefitting primarily large brokerages" leaves the door open to further investigation. And while the footnote doesn't spell out what those exceptions might be, private listing networks — which benefit from scale — could fall in that category. 

A veiled reference? The DOJ doesn't mention who or what inspired these comments, but one of the loudest voices in the Clear Cooperation debate is Compass CEO Robert Reffkin, who has rallied his agents to capture more private listings. He also commented on Instagram in September that "Clear Cooperation is being actively investigated by the DOJ and will lead to countless law suits." 

'A good sign,' industry lawyer says: Brian Schneider, partner at ArentFox Schiff and legal counsel for Bright MLS, interprets the language as the DOJ signaling that the Clear Cooperation rule itself "does not seem to be anti-competitive," which Schneider adds is "a good sign for the industry" in the sense that "a voluntary cooperative sharing of cooperatively marketed listings is pro-competitive, not anti-competitive."

But as a lawyer who works with MLSs, Schneider also believes brokerages who have a major presence in a particular market "need to be very careful" if they're only making their listings available to "a certain subset of brokers."

"It's conceivable that the Justice Department would find that worth investigating," he said. 

A warning to MLS leaders? Compass, which has recently highlighted having upward of 20,000 listings available only on its site — as well as its willingness to "co-broke with everyone" — has also reportedly been reaching out to MLSs this week.

According to industry consultant and blogger Rob Hahn, Reffkin warned MLS leaders about potential litigation from enforcing Clear Cooperation and urged that "it is critical to maintain the Office Exclusive designation."