A federal administrative hearing, which began June 19 to consider an antitrust complaint brought by the Federal Trade Commission against a Michigan multiple listing service, closed on Thursday after the final witness was called, and a decision in the case may still be months away.
The FTC charged in its October 2006 complaint that Realcomp II Ltd., a Realtor-owned MLS with about 15,000 members, adopted rules that restrict a category of for-sale property listings from public display on popular home-search Web sites including Realtor.com. The FTC settled similar actions against six other MLSs prior to an administrative hearing, which is a trial-like process.
Geoffrey Oliver, the FTC’s assistant director of anticompetitive practices, said that a cycle of post-trial briefings and findings of fact will follow the close of the hearing process. Deadlines of July 31 and Aug. 14 are set for both sides to prepare these legal filings, he said. After closing arguments, the administrative judge presiding in the case will consider a judgment. A final ruling may be issued in late August or early September, Oliver said.
Transcripts of the hearing process have not yet been released to the public. Steven Murray, publisher of real estate research and information company Real Trends, and Craig Mincy, of Michigan flat-fee property listing company MichiganListing.com, were among the witnesses that FTC officials called to testify.
Several industry officials, including administrators for the National Association of Realtors, Realcomp II MLS and real estate brokerage companies provided depositions for the case.
The list of people who gave depositions for the case includes Karen Kage, David Elya, Daniel Mulvihill, Alissa Nead, Douglas Hardy, Douglas Whitehouse, Darralyn Bowers, Robert Gleason, Robert Taylor, Carl Williams, Virginia Bratt, Martin Nowak, Gerald Burke, Thomas Rademacher, Walt Baczkowski, John Cooper, Michelle Brant, Ryan Tucholski, Clifford Niersbach, Robert Goldberg, Philip Dawley, Paul Bishop, Paul Simos, Robert Greenspan, Wayne Aronson, Anita Groggins, Jeff Kermath, Dreu Adams and John Kersten, according to legal filings.
The National Association of Realtors has approved a maximum $175,000 contribution to support Realcomp II’s legal defense.
The FTC has charged Realcomp restricted competition by imposing restrictions on the display of property information related to homes under exclusive agency listing agreements. Under this form of listing contract, sellers may pay a discounted commission or no commission to the listing agent if they are able to sell the home on their own.
Properties entered into the MLS system that were under a more common type of listing agreement known as an exclusive-right-to-sell agreement were not impacted by the restrictions. Under an exclusive-right-to-sell agreement, the property owner is obligated to pay their agent regardless of who brings in the buyer.
Realcomp officials have said that the restrictions were passed because of the potential for exclusive agency listings to facilitate home sales without the use of a Realtor. The MLS has acknowledged in legal filings related to the FTC complaint that it has implemented some recent rule changes related to default display of listings to MLS users and to the definition of an exclusive-right-to-sell broker, for example.
Karen Kage, CEO for Realcomp II, said today that while the MLS has initiated some rule changes, it has not changed its rules that block the sending of property information under exclusive agency agreements to a range of public Web sites.
Realcomp II and broker-owned MiRealSource MLS in Michigan are also facing a lawsuit brought by a company that formerly offered low-cost real estate brokerage services in the state. MiRealSource, a broker-owned MLS with about 7,000 members, in February settled antitrust claims brought by the FTC.