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Lawyer letter details NAR’s internal harassment investigation

Lawyer’s letter reveals outside counsel found evidence of “creepy” and “disrespectful” behavior at NAR long before the Brevard suit

As Tracey Kasper, the National Association of Realtor’s newly appointed president, put it, the trade group is “grappling with a very difficult situation.” Kasper made the comment during a five-minute-long video message to members and employees posted on Thursday.

NAR’s “difficult situation” came into focus in June, when former NAR employee Janelle Brevard filed a lawsuit accusing trade group of racial and sexual discrimination and alleging that NAR president Kenny Parcell harassed female employees. While Brevard settled the lawsuit roughly a week after filing it, receiving a $107,000 severance payment and inking a nondisclosure agreement from NAR, the trade organization’s troubles didn’t end there. In late August, the New York Times published an exposé revealing sexual harassment allegations and a “culture of fear” at NAR, which ultimately led to Parcell’s resignation.

In the wake of the bombshell story, NAR and its executives claimed to have no knowledge of widespread misconduct, with NAR CEO Bob Goldberg telling the Times that he “would not characterize [sexual harassment at NAR] as a problem.”

In addition, in a NAR Magazine article from August 10, 2023, titled “NAR prioritizes a respectful workplace,” Goldberg is quoted as saying that the trade organization “consistently strives to improve our workplace for every employee, and we have a robust set of policies, protocols and training programs in place to help us maintain a positive, respectful working environment,” and that NAR prides itself “on following the best governance practices in place throughout our nation, and we remain focused on fostering a culture that encourages our people to be heard and come forward if needed.”

The Polsinelli letter

However, a letter from Denise Drake, an attorney at Polsinelli Law Firm to Goldberg from July 14, 2023, obtained by Inman News, casts doubt on NAR’s timeline and commitment to cleaning up a toxic culture.

The letter reveals that NAR initiated an investigation into the behavior of NAR staffers and executives. Polsinelli looked into allegations of misbehavior in 2022 and the claims raised by Brevard in her suit. Drake wrote that Polsinelli found evidence in 2022 that the organization’s “highest leaders” engaged in “disrespectful” and “creepy” behavior. Drake’s letter was sent two weeks after the Brevard suit was filed and a week after she voluntarily withdrew the case.

The letter, which was published by Inman, appears to confirm that Polsinelli found evidence of past misbehavior among multiple leaders, despite NAR leaders making repeated statements downplaying any such problems at the organization.

“As you know,” Drake wrote in the letter, “I found some issues raised last year were true. Those issues ranged from NAR’s highest leaders being disrespectful, or lying about staff or members, to leaders being racially insensitive or engaging in sexual or ‘creepy’ communications or actions. Again, both female and male leaders were identified as having been involved in some of the allegations I found valid.”

Drake does not disclose the leaders who were involved or the allegations that she deemed “valid.”

However, in the letter, Drake states that based on her investigation, the allegations in the Brevard lawsuit were not true. She also claims that if the suit had continued, NAR would have been able to file legal documents that “cast a different light on the allegations.” Additionally, Drake notes that Brevard’s claim that three other women made complaints about Parcell’s behavior were inaccurate, stating that “both the number of women and the issues were false.”

Since the letter was sent to Goldberg, more than two dozen other women have come forward with allegations of misconduct.

According to the letter, NAR tried to support Parcell, with Drake writing that she exchanged counsel emails with NAR’s legal executives “strategizing ways to support Mr. Parcell, not just NAR,” as she and NAR’s legal team worked to ensure “that we came up with creative ideas in support of NAR and Mr. Parcell, well beyond what other organizations or companies typically allow.”

Parcell maintained in his resignation letter that the allegations against him were “categorically false.”

According to the letter, Drake believed that the Brevard lawsuit and the allegations it made against NAR and Parcell would be short lived.

“Unless you have leaders gossiping,” Drake said in the letter, “stirring up problems, or allowing others to gossip and stir up problems, this issue should go away quickly for NAR and Mr. Parcell.”

In the letter, Drake also praised Goldberg and NAR for implementing new policies and procedures to combat harassment and she states that NAR took “disciplinary or other action with specific individuals.” Drake did not name the individuals who were disciplined.

NAR not giving up on Goldberg

In the wake of the scandal, NAR has thrown its support behind Goldberg. In a statement dated September 1, 2023, confirming that a rumored emergency meeting had in fact taken place earlier in the week, Kasper wrote: “The consensus among the Executive Committee is we need to rebuild trust with staff and members with meaningful change. The Executive Committee agreed we have a shared purpose and are united in support of our staff and that includes Bob.”

Goldberg is currently set to retire at the end of 2024, closing out his 30-year career at the trade group.

In a video message on Thursday, Kasper reiterated that NAR acknowledges that it must rebuild trust between itself and its members and staff.

“It’s upsetting to hear that some members and staff have not felt safe or respected and I want you to know that I hear you,” Kasper said.

Kasper, a Boise, Idaho-based agent who’s been in the group’s leadership circle for years, said NAR would “do and be better” in the future, noting that NAR is “going to engage outside experts to assess the way reports of misconduct are investigated and resolved.”

She also told members that NAR is going to evaluate how leaders are selected, as well as how they interact with staff. Kasper, however, did not discuss findings from past investigations into misconduct and states that NAR has only recently launched investigations due to “recent reports” of sexual harassment, which appears to contradict what Drake wrote in her letter.

The NAR Accountability Project

For many industry professionals, NAR’s response to this scandal has been far from adequate. On the Monday after the publication of the Times exposé, Jason Haber, Compass agent from Manhattan, started a petition calling for Parcell’s dismissal. By Wednesday, this effort had morphed into the NAR Accountability Project

Last Saturday, a week after the Times’ story ran, Haber created another petition calling for the resignation Bob Goldberg and other NAR executives.

In a statement on outlining the NAR Accountability Project’s four point plan, Haber wrote, “As a member of this coalition and someone who has closely followed the revelations about NAR’s workplace culture, I am deeply disturbed about what has been revealed.   It is disheartening to see an institution that should be promoting professionalism and integrity in real estate instead perpetuating an environment where women feel unsafe. It is time for use to take action. We cannot stand idly by while countless individuals suffer from these injustices. We must demand accountability from NAR’s leadership and push for immediate changes that will protect their employees’ well-being while restoring the association’s good name.”

In addition to the resignation or dismissal of Goldberg and others, the plan calls for all former employees and independent contractors to be released from non-trade secret NDAs, for NAR to retain an independent law firm to conduct “a sweeping and comprehensive internal investigation,” and for NAR to implement a third party HR reporting system.

The petition had over 300 signatures as of Friday afternoon.

Restoring trust

In an emailed statement to HousingWire, Kasper wrote that NAR acknowledges not enough has been done to restore members’ and staffers’ trust in the organization.

“The leaked memo was shared with NAR’s Executive Committee and Past Presidents right after the Janelle Brevard lawsuit was filed and subsequently withdrawn. At the time, we had been advised by outside counsel that the allegations against the sitting president, while disturbing and unprofessional, did not rise to the level of unlawful conduct and corrective action had been taken with him. It was also indicated that there had been no further reports of misconduct since that action,” she wrote.

“We are focused on making meaningful change with urgency and intent to create an environment that promotes accountability and transparency. We have engaged external culture experts to evaluate our existing policies and protocols and help our organization continue to improve and evolve. In everything we’re doing to move forward and address needed changes, I believe we are on the right path to do better in leadership decision-making and in listening to and supporting our members and staff,” she concluded.

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