As you may know, I follow numerous real estate news and commentary websites and I have found the Notorious ROB, Rob Hahn, to be one of the best. Recently, Rob posted a couple of articles about the numerous restraints of trade lawsuits our industry is facing. I have followed these lawsuits for some time and believe that everyone who practices real estate, as a professional, should be doing the same. These lawsuits each have the potential to dramatically change the way real estate is practiced regardless of what state you are in. “Knowledge is power”
First let us talk about Nosalek v MLS Property Information Network, Inc. (MLS PIN). MLS PIN is the 7th largest MLS in the country covering six New England states (Massachusetts, New Hampshire, Connecticut, Rhode Island, and New York and has approximately 41,000 members. The suit, filed in December 2020, alleges a violation of the Sherman Anti-Trust act, arising out of the conspiracy to keep commissions high by forcing sellers to pay the buyer’s agent. Like Moehrl and Sitzer this suit was filed in Federal District Court. One significant difference between Moehrl and Sitzer and Nosalek is that the Nosalek suit does not name the National Association of REALTORS as a defendant. The suit names MLS PIN, Realogy Holdings (now known as Anywhere), HomeServices of America, Inc, BHH Affiliates, LLC, HSF Affiliates, LLC, RE/MAX LLC, and Keller Williams Realty, Inc., as defendants. The suit does name as “Co-Conspirators” multiple state and local REALTOR Associations, multiple franchisees, and brokers of the Broker Defendants. “In addition, other brokers in these areas have participated as co-conspirators in the violations alleged herein and performed acts and made statements in furtherance thereof. Also included (paragraph 16) “Defendants are jointly and severally liable for the acts of their co-conspirators whether named or not named as defendants in this Complaint” The lawsuit has already survived the motion to dismiss and will likely seek class action certification. Sitzer lawsuit has already been certified and should go to trial this year and Moehrl recently was awarded certification as a class action. It seems plausible that should Nosalek seek class action certification it would be granted. If class action is granted damages could approach $20 billion.
Here is a link to Notorious Rob’s article – (some are free to read and some may require a subscription of $20/month – well worth it – sometimes there is a 7 day free trail https://notoriousrob.substack.com/p/on-the-third-commission-lawsuit-nosalek
Here is a link to the Nosalek complaint: https://acrobat.adobe.com/link/review?uri=urn:aaid:scds:US:77ec4f0d-3d58-32ba-b3da-2ee1e8e47c93
In another article Rob talks about what it means to be a Co-Conspirator and the meaning of Joint and Several Liability, hint it is not good. Rob is a retired lawyer from the NYS Bar, which is why I like to follow his work. You really need to read this article to get a good picture of what the real estate industry is facing with these multiple lawsuits.
Here is a link to Notorious Rob’s article – (some are free to read and some may require a subscription of $20/month – well worth it) https://notoriousrob.substack.com/p/not-a-defendant-but-a-co-conspirator