Trial for NAR, brokerage class action commission lawsuit is postponed

NAR and Anywhere clash over Missouri District Court judge’s decision to postpone the trial

Those awaiting the verdict from a federal class action commission lawsuit filed against the  National Association of Realtors (NAR) and several national brokerages will have to wait a bit longer.

The trial in the Sitzer lawsuit (named after its lead plaintiff) was scheduled to begin on February 21, 2023, but at the request of real estate conglomerate Anywhere (referred to as Realogy in all court filings), has been postponed indefinitely.

Judge Stephen R. Bough of U.S. District Court in Western Missouri granted Anywhere’s motion to continue on December 13. In his ruling, Bough said the court would choose a new trial date “in late 2023,” but an exact timeline was not provided.

Unlike Anywhere, NAR is staunchly against the trial postponement.

“The National Association of REALTORS® was prepared for trial, and regardless of the timing, we are confident we will prevail,” Mantill Williams, NAR’s vice president of communications, wrote in an emailed statement. “The U.S. model of local broker marketplaces has long been – and is still – viewed as the best value for consumers around the world. Local broker marketplaces provide sellers equal access to the largest possible pool of potential buyers and create the greatest number of housing options for buyers in one place without hidden or extra costs. Listing brokers making offers of compensation to buyer brokers also gives first-time, low/middle-income and all homebuyers a better shot at affording a home and professional representation.”

The lawsuit, which was originally filed in 2019 and won class-action status in April, alleges that some NAR rules, including one that requires listing brokers to offer buyer brokers a commission in order to list a property in a realtor-affiliated MLS, violate the Sherman Antitrust Act by inflating seller costs.

Through the class certification, hundreds of thousands of home sellers in four MLS markets in Missouri can ask the defendants, which include Keller Williams, RE/MAX, HomeServices of America and its subsidiaries BHH Affiliates and HSF Affiliates, as well as Realogy and NAR, to be reimbursed for the $1.3 billion in commissions they paid to buyers’ agents in the past eight years. However, potential treble damages could put the total damages in the case at around $4 billion.

Earlier this year the defendants filed a motion to compel the plaintiffs into arbitration rather than have the court decide the case, but this motion was denied by Bough in July. In response, HomeServices and its subsidiaries appealed the decision to the U.S. Court of Appeals for the Eighth Circuit.

While the appeal is pending, Bough granted a stay on any claims raised by unnamed class members who executed a listing agreement containing a binding arbitration clause with a subsidiary of HomeServices.

Due to his granting of that stay, Bough sided with Realogy and agreed to postpone the trial date until after the HomeServices’ appeal is decided.

“Despite the plaintiffs’ arguments to the contrary, this Court believes that all parties need to be present throughout the case if there is to be joint and several liability as argued by plaintiff and that the Eighth Circuit currently has jurisdiction over the stayed claims,” Bough wrote in his decision.

“Joint and several liability” means that all of the defendants would be held independently responsible for 100% of the damages from the alleged conspiracy if that conspiracy is proven.

RE/MAX and Keller Williams both responded that they typically do not comment on ongoing litigation, while Anywhere and HomeServices of America had not returned a request for comment by the time of publication.