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Commission lawsuits head to Utah

NAR, corporate brokerages and local franchises named as defendants

Yet another copycat commission lawsuit has hit the court dockets. On Friday, home seller plaintiff Dalton Jensen filed an antitrust lawsuit in U.S. District Court in Utah, accusing real estate industry players of colluding to artificially inflate real estate agent commissions.

Like the other commission lawsuits, the Jensen suit is seeking class action status for anyone who sold a property listed on Wasatch Front MLS, Washington County MLS, Iron County MLS or Summit County MLS between Feb. 9, 2020, and the present, and paid a buyer broker commission.

Despite being listed in the suit, the four MLSs are not listed as defendants. Making an appearance on the defendant list are the National Association of Realtors, Anywhere and its franchise Century 21 Everest, HomeServices of America and its affiliates, RE/MAX, Keller Williams and two local franchises, Equity Real Estate, Realtypath and Windermere Real Estate Services.

It should be noted that Keller Williams, RE/MAX and Anywhere have filed settlement agreements in the Sitzer/Burnett, Moehrl and Nosalek suits, with RE/MAX and Anywhere receiving preliminary approval on their settlements.

The complaint argues that NAR’s Participation Rule, which requires listing brokers to make a blanket offer of compensation to buyer’s brokers in order to list a property on a Realtor affiliated MLS, is the “cornerstone of [the] defendants’ conspiracy.”

“If NAR’s Adversary Commission Rule were not in place, then the cost of buyer broker commissions would be paid by their clients (home buyers),” the complaint states. “Buyer brokers would thus have to compete with one another by offering a lower commission rate. The Adversary Commission Rule thereby restrains price competition among buyer brokers because the person who actually retains the buyer broker — the home buyer — does not negotiate or pay the commission for his or her broker.”

While there are now close to two dozen copycat commission lawsuit across the country, this is the first filed in Utah. In addition to seeking class action status, the Jensen suit demands a jury trial and is seeking treble damages and a permanent injunction that enjoins the defendants from requiring sellers to pay the buyer broker.

“Over the weekend, HomeServices obtained a copy of the latest lawsuit filed in Utah,” Chris Kelly, an executive vice president at HomeServices of America, wrote in an email. “We are analyzing the specifics of the case, particularly the timeframes and MLSs mentioned in the suit, to ascertain the relevance of HomeServices as a defendant in this matter, especially considering that we do not have any company-owned brokerages operating in the specified areas.”

Mantill Williams, the vice president of communications at NAR, shared a similar sentiment: “The cooperative compensation practice makes efficient, transparent, and accessible marketplaces possible. Sellers can sell their home for more and have their home seen by more buyers while buyers have more choices of homes and can afford representation. The National Association of REALTORS® will respond to this complaint in court.”

The other defendants in the suit did not return a request for comment.

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