A U.S. District Court judge has denied a motion by the National Association of Realtors trade group to dismiss an antitrust lawsuit filed last year by the U.S. Department of Justice.
Justice Department officials charge in the lawsuit that the Realtor group has adopted overly restrictive policies for the online display and sharing of property listings information. The trade group had sought in a December court filing to dismiss the federal government’s case, disputing several aspects of the lawsuit.
Mark Filip, a U.S. District Court judge for the Northern District of Illinois, wrote in a Sept. 28 court notice that a status conference will be held Oct. 30, and a detailed opinion about the court’s denial of the motion to dismiss the lawsuit will be distributed to both parties on or before that day.
Laurie Janik, general counsel for the National Association of Realtors, said of the judge’s decision, “We’re not surprised but we’re disappointed.” Janik today said the association has not yet received the full opinion of the judge in denying the lawsuit’s dismissal. “We’re looking forward to the written opinion so that we can learn from that.”
Gina Talamona, a Justice Department spokeswoman, said, “We’re pleased the court denied NAR’s motion to dismiss the case and we’re looking forward to moving ahead with our case.”
According to a July 11 court document, the Justice Department will “disclose in writing the MLS (multiple listing service) areas from which it intends to draw evidence to prove anticompetitive effects” in the lawsuit by Oct. 16. Earlier this year, Janik announced that at least 14 MLSs had received subpoenas from the Justice Department relating to the agency’s lawsuit against the trade group. The MLS of Northern Illinois, one of the largest Realtor-operated MLSs in the country, was among those MLSs that received a subpoena.
The National Association of Realtors will disclose its “pro-competitive justifications” for its challenged Internet policies “along with a list of the MLS areas for which it intends to present evidence” by April 15, according to the court document, and the evidence-gathering period for these items will close June 15, according to the document.
While representatives for the Justice Department and National Association of Realtors met in a settlement conference on March 22, a court document on April 20 states that the parties reported “several key impediments to settlement.”
After filing an initial antitrust complaint against the Realtor association in September 2005, the Justice Department submitted an amended complaint the following month. The initial complaint charged that a Virtual Office Web site (VOW) policy adopted by the Realtor group contained anticompetitive provisions. In its request to dismiss the lawsuit, the association stated that it had withdrawn that VOW policy prior to the filing of the original complaint and put in place a new Internet Listings Display policy.
But the Justice Department, which had conducted a two-year probe of the association’s VOW rules, charged in its amended complaint that the modified policy also is anticompetitive. After the amended complaint, the Realtor association advised Realtor-operated MLSs not to implement the ILD policy and advised MLSs not to enforce the disputed aspects of the VOW policy.
The association stated in its motion to dismiss the lawsuit that its VOW and ILD policies “impose no restraints whatsoever on any of NAR’s members who would be subject to the policies if they were being enforced. They do not encourage NAR members to refuse to allow listings to be displayed on other brokers’ Web sites.”
While the policies did contain provisions that would allow MLS members to opt out from displaying listings on other MLS members’ Web sites, “any decision to opt out is made unilaterally by listing brokers exercising their independent judgment,” the association stated in court filings.
In a Feb. 6 court filing responding to the association’s motion, the Justice Department stated that the trade group’s arguments “all miss the mark,” and “NAR’s VOW policies constitute restraints of trade, despite NAR’s protestations to the contrary, because they restrain competition in real estate markets, generally, and the behavior of multiple listing services and virtual office Web site operators, in particular.”