LegalReal Estate

47 Texas real estate firms, associations get hit with second commission lawsuit

Plaintiffs in the Martin suit seek action against local Realtor associations, MLSs and brokerage firms

As the saying goes, everything is bigger in Texas. A copycat commission lawsuit filed on Thursday by home sellers in the United States District Court for the Eastern District of Texas, accuses 47 real estate industry defendants of allegedly conspiring to artificially inflate real estate agent commissions.

This is the second commission lawsuit filed in the Lone Star State since a Missouri jury found the real estate industry liable for colluding to inflate agent commissions in late October.

The new lawsuit, which was filed by Julie Martin, Mark Adams and Adelaida Matta, includes many of the same defendants as the QJ Team lawsuit, but many new ones as well.

Notably, the suit names several local Realtor associations, in addition to the Texas Association of Realtors, including, Austin Board of Realtors, San Antonio Board of Realtors, Metrotex Association of Realtors, Houston Association of Realtors, Greater El Paso Association of Realtors, Greater Fort Worth Association of Realtors, Fort Hood Area Association of Realtors, Four Rivers Association of Realtors, Temple-Belton Board of Realtors, Victoria Area Association of Realtors, and Williamson County Association of Realtors.

The suit also names a handful of local multiple listing services (MLSs), including Austin/Central Texas Realty Information Service, Central Texas Multiple Listing Service, Housing Realtors Information Service, and North Texas Real Estate Information Systems.

Finally, like the QJ Team suit, in addition to naming some national brokerage firms including Keller Williams, Side and HomeServices of America, the Martin suit names many local firms, franchises and real estate teams, including ABA Management, Penfed Realty, Ebby Halliday Real Estate, Dave Perry-Miller Company, Heyl Group Holdings, The Loken Group, Hexagon Group, DMTX, Keller Williams San Antonio, San Antonio Legacy Group, DSJMM, Fathom Realty, Grace Realty Group, Citiquest Properties, JP Piccinini Real Estate Services, Team Burns, ABRE Capital, Realty Austin, ATX Air, The Micheal Group, Square MB, Mark Anthony Dimas, Greenwood King Properties II, Turner Magnum, Moreland Properties, Real Agent, RFT Enterprises, ATC Metro Properties, and MJHM.

Like the other commission lawsuits, the Martin suit accuses the real estate industry of violating antitrust laws and taking part in a “conspiratorial scheme” by requiring sellers and their listing agents to make a blanket offer of compensation to the buyer’s broker. The blanket offer of compensation is required by the National Association of Realtors’ Participation Rule in order to list the property on the MLS.

“Defendants’ conspiracy has inflated and stabilized buyer broker commissions, resulting in higher total commissions paid by home sellers like Plaintiffs and Class members. Plaintiffs and Class members have each incurred, on average, thousands of dollars in overcharges and damages due to Defendants’ alleged conspiracy,” the complaint reads.

NAR is notably missing from the robust defendants list, however, the complaint does name NAR as the “creator of the conspiracy.”

Both Anywhere and RE/MAX, who have entered into settlement agreements with the plaintiffs in the original three commission lawsuitsSitzer/BurnettMoehrl and Nosalek, were named as co-conspirators in the suit along with the franchisees and brokers of the defendants in the suit.

The suit is seeking class action status on behalf of anyone who listed a property for sale on an MLS in Texas between Nov. 13, 2019, and the present and the plaintiffs are demanding a jury trial. The plaintiffs are also asking the court for damages and a permanent injunction blocking agents from being required to take part in cooperative compensation.

The defendants did not return a request for comment.  

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