The plight of a Florida agent who was dragged into a fair housing lawsuit over the description of a property he did not represent has raised awareness among real estate professionals that they can be sued for the content of listings that appear on their websites, regardless of whether they are the author.

Tampa-area agent Jeff Launiere and the brokerage he works for, Charles Rutenberg Realty, were sued in federal court last November by Cristin Forrest, a self-described “independent fair housing tester.”

In her complaint, Forrest said she was looking for fair housing violations online when she saw a listing advertising the sale of a condominium at Broadmoor Villa that read “Adunt [sic] only community no children under 16.”

Broadmoor Villa Inc. was also named in the suit, which alleged that all three parties had violated the federal Fair Housing Act, which prohibits discrimination on the basis of familial status, among other things.

Broadmoor Villa was dismissed from the case and Charles Rutenberg Realty agreed to settle the case — potentially leaving Launiere on the hook for the $5,000 deductible on his brokerage’s errors and omissions insurance policy.

Industry experts say that such occurrences are rare, but that the lawsuit highlights the importance of flagging potentially troublesome language or images that appear in Internet Data Exchange (IDX) listings before they are displayed on broker and agent IDX websites. MLSs, brokerages and agents also provide listing data to other, third-party websites like Realtor.com, Zillow and Trulia.

Although the Communications Decency Act may protect agents and brokerages from lawsuits over listing content they did not author, anecdotal evidence suggests that, in some cases, firms prefer to settle such cases rather than engage in costly litigation.

Launiere says he learned another lesson from the case: if he’s named as a co-defendant in a lawsuit again, the first thing he’ll do is get his own legal representation. Launiere was dismissed as a defendant in the lawsuit Monday — but only after the plaintiff discovered he was not the listing agent for the property at issue, something he said his company’s attorney only recently became aware of.

For now, Launiere says he will no longer display IDX listings on his website, unless his multiple listing service removes the “remarks” field from its IDX feed.

Many, if not most, real estate agent and broker websites display IDX listings, which are pools of listings contributed by brokers who are members of a particular MLS and fed by that MLS to members’ websites. IDX allows real estate pros to display virtually all of the for-sale home listings in their given market, which helps attract consumers to their websites.

In the complaint, Forrest said she first found the listing for the Broadmoor Villa condo on Realtor.com, where Charles Rutenberg Realty was named as the listing broker but no listing agent was identified, and later found the same listing on tampahomespecialist.com, a site that belongs to Launiere.

(Charles Rutenberg Realty was the listing brokerage, but the identity of the listing agent remains unclear. Although the property sold in August, it was still listed today as “Active with Contract” on Realtor.com, which declined to comment).

Screen shot of disputed Broadmoor Villa condo listing as it appeared on Realtor.com today.

The complaint identifies Launiere as the listing agent for the property in question, but — as Launiere said in an ActiveRain blog post published last week — he was not.

Launiere said his brokerage’s attorney notified him the case was being settled for $5,000 and he would have to pay that same amount to his errors and omissions insurance company as a deductible.

The settlement would mean he would not be cleared of responsibility and the attorney could not tell him whether or not his name and the alleged violation would be reported to the state’s real estate commission or any other agency, or whether he could have his license suspended or receive any other penalty. Meanwhile, the actual listing agent in the case, another agent in his office, would pay no penalty.

“I have no plans on paying the $5,000 or signing any agreement that says I am guilty of federal discrimination laws, since I am not guilty of any of the accusations. I will likely be in federal court, though with a federal lawsuit, my guess this whole process will take a long time,” Launiere wrote in a blog post.

He noted that he had taken down all for-sale listings from his website.

“I have been also told that this or any other independent fair housing tester may visit my website again, especially since I have already been accused of federal fair housing violations, and file another lawsuit if they can find another listing that is in violation,” he wrote. “They also said all real estate agents can face the same lawsuits. Sounds like a profitable career path, for both the testers and attorneys who have no qualm with destroying people’s lives.”

In another blog post the following day, Launiere posted a video of Brian Stevens and Frank Garay featuring the lawsuit against him in their video blog on National Real Estate Post.

Industry takes note

Launiere said it was important for other agents to learn about his predicament, “as most agents are not aware that they can be sued for any listing that appears in an MLS IDX feed, whether that listing is yours or not.”

The posts touched a nerve with agents and brokers, drawing more than 400 comments, most expressing support for Launiere. Some even offered to contribute to a legal defense fund. Launiere reported receiving more than 1,500 emails about the case and said his phone did not stop ringing on Monday.

“I think the fact that the lawsuit was against somebody that wasn’t the listing agent” caused the news to take off “like crazy,” he said.

He partially credits the lawsuit’s dismissal to the attention his blog posts garnered. He was told to “cool it with the blogs” after he was dismissed from the case, he said.

“I just thank the entire real estate community that made this go viral and made it recognized,” he said.

Laurie Janik, general counsel for the National Association of Realtors, said fair housing law makes no distinction based on who wrote the alleged discriminatory content.

“Liability attaches by virtue of the act of publishing the discriminatory content,” she said.

Nonetheless, there is one defense that might protect an agent such as Launiere from liability if the discriminatory comments came from the IDX feed, she said.

“That defense is based on Title V of the Communications Decency Act of 1996 (CDA), which states that ‘[n]o provider … of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.’ This law protects sites like Realtor.com or Craigslist,” she said. “I am not aware of any case in which a court has determined the applicability of the CDA to an agent’s IDX display.”

(In 2006, Craigslist successfully argued that websites which serve as intermediaries, allowing users to post ads or commentary, enjoy protections under the Communications Decency Act not afforded to print publications such as newspapers. Craigslist had been sued by a nonprofit that claimed it found more than 200 ads offering housing for rent that violated the Fair Housing Act.)

Janik said she had not heard of a similar lawsuit being filed against someone who was not the listing agent before and Launiere’s case could have set a precedent for the industry had it not been resolved. Before he was dismissed from the case, she would not say whether she would have recommended he fight the case or pay the settlement, however.

“Litigation is extremely stressful. Parties often settle cases even when the claim is baseless due to the time, effort and expense of litigation,” she said.

One simple remedy for real estate pros to avoid getting sued for content posted by other MLS members is to have the “remarks” field, where agents typically type in a listing description, deleted from the IDX feed, Janik said.

“That would be the field where any potentially discriminatory remarks would be included. By omitting that field, no such remarks would be disseminated and could not be published by any of the brokers or agents on their IDX sites.”

Cristin Forrest did not return a voicemail seeking comment. Her attorney, Shawn Heller of the Social Justice Law Collective, said Forrest acted on the belief that Launiere was the listing agent for the property at issue.

“Promptly upon learning that Mr. Launiere was neither the listing agent nor the author of the offending advertisement, Ms. Forrest has joined with Mr. Launiere in filing a Joint Stipulation of Dismissal … dismissing Mr. Launiere from the lawsuit,” he said.

“While we strongly believe that the real estate community in Florida must take action to ensure that illegal and discriminatory advertisements cease to be distributed to the public, neither Ms. Forrest nor the Social Justice Law Collective take any current position as to the legality of re-posting discriminatory advertisements through use of the Internet Data Exchange.”

Broadmoor Villa was dismissed from the suit in January after filing a motion that, among other things, pointed out that Broadmoor’s policy prohibiting the rental or sale of units to families with children under 16 had been repealed in 1994, nearly 20 years ago.

Charles Rutenberg Realty was party to the same settlement Launiere said he refused to pay. On Jan. 24, the day after the parties notified the court of a settlement agreement, the court issued an endorsed order dismissing the case, though the parties had 60 days from that date to submit documents that could extend the case further.

John Rurkowski, Charles Rutenberg Realty’s managing broker, declined to comment on whether the brokerage would pay the settlement. Citing pending litigation, Heller declined to comment on the status or extent of any settlement discussions or whether Forrest planned to sue the actual listing agent in this case.

In January, Forrest filed a separate fair housing complaint against F & D Holdings LLC, doing business as Keller Williams Elite Properties in Aventura, Fla.; Keller Williams Realty Inc.; and agent Myra Wolf for a rental listing that read, “No smokers, no children or pets please!” While the suit against Keller Williams Realty Inc. was dismissed last week, the brokerage and Wolf remain parties to the case.

Wolf, 78, told Inman News she was the listing agent in that case and included those prohibitions at the request of her client. It was the last deal she did before retiring over a year ago after her husband became ill and it rented in an hour and a half, she said. Her net commission was somewhere around $300 or $400, she added.

“It is not an over-55 building, so I should not have put ‘no children.’ I am abjectly sorry and I can’t say more than that,” she said.

(A 2010 study of ads on Craigslist concluded that “the overwhelming majority of problematic ads discriminate on the basis of familial status. There are very few that discriminate based on race, ethnicity, or religion.”)

Wolf said she had been in real estate for many years and had never previously had a complaint against her. She added that her broker entered her listings into the MLS and published them online and was responsible for reviewing them before doing so. She does not know whether her company plans to settle.

Manny Deren, broker-owner of Keller Williams Elite Properties, declined to comment, saying, “It’s in the hands of our attorney and I’m not at liberty to discuss it with anyone.”

Amy Christiansen of Spector Gadon & Rosen, who represents both brokerages in the suits brought by Forrest, declined to comment on pending cases.

Heading off trouble

Matt Cohen, chief technologist for Clareity Consulting, said there are at least three steps that real estate professionals could take to avoid a situation similar to Launiere’s. The first two involve measures that can be taken by MLSs.

“Many MLSs provide a high level of service so that their subscribers can avoid this kind of issue. For example, using automated tools to check entries for fair housing issues when they are entered into the MLS system,” he said.

MLSs could also include language in their terms of service in which listing brokers indemnify other member brokers of the legal ramifications posed by information and images uploaded to the MLS, he said.

“The listing broker would be responsible for advertising content that they create and in this case it would just clarify that if you put something in the MLS, the legal consequences for someone else, whether copyright or fair housing, (are) the responsibility of the broker that entered it,” Cohen said.

“All MLSs should have those provisions in place so that brokers are not responsible for each other’s missteps,” he added.

Launiere is a member of My Florida Regional MLS. Launiere said he was unaware of whether the MLS had any such safeguards in place, though he recalled being told that the MLS had software in place to catch fair housing violations. The MLS did not respond to a request for comment.

In regards to indemnification, Janik said indemnification is only as good as the assets of the party offering it.

If one party offers to indemnify another party for the costs of a legal action but the party offering the indemnification has no assets, what good is the promise to indemnify? You always want to make sure that the party agreeing to indemnify you has assets, otherwise it is a pretty worthless promise,” she said.

“I think a better solution is to educate agents on their fair housing responsibilities, put screening software in place or consider deleting the remarks from the IDX feed,” she added.

While some of those commenting on Launiere’s blog posts suggested he go after the MLS for his legal costs, Janik said she knows of no basis to hold the MLS liable for the content of the feed to its participants and subscribers.

“Many MLSs require compliance with the fair housing laws with respect to any comments authored by agents pertaining to their listings. I do not believe those rules impose an affirmative obligation on the MLS to police the members’ compliance with the rules, so I know of no basis to hold the MLS liable for the failure of a broker or agent to follow the rules or comply with the law,” she said.

Once a lawsuit has been filed, the best thing a Realtor can do is take advantage of the resources at his or her disposal as a member of local, state, and national Realtor associations, Cohen said.

“If something comes up like this, I would always call Laurie (Janik) first. Always, always, always. There is a reason to belong to a nice, big, capable trade association,” Cohen said.

He said he was sorry to see that the situation had gotten out into the “social media level” when it could have been dealt with properly at the beginning.

“It puts fear out into the industry, a fear of cooperation on which our industry is founded,” he said.

Implications for IDX

Cohen said Launiere’s case was “an issue core to cooperation” and therefore core to associations and MLSs, but that anyone proclaiming the case signals the death of IDX should keep in mind that such cases are exceptionally rare.

Cohen himself has never heard of a similar case, even though MLS information is now quickly disseminated, sometimes every 15 minutes or in real time, he said.

“Between the automated systems and the MLS participants watching out for each other and complaining when they see issues, fair housing violations in the MLS I believe are very rare and certainly they get caught very quickly in cases where they do go in,” Cohen said.

Launiere said he did not reach out to any associations because his broker and the company’s attorney told him they would handle the suit and work to have his name removed. The next he heard was that the case was being settled and he was being asked to pay.

“I don’t feel like I’ve been protected or represented at all,” he said. Christiansen hadn’t even been aware that he wasn’t the listing agent for the property in question, he said. The motion to dismiss she filed with the court in early January does not mention that Launiere was not the listing agent.

Launiere doesn’t know whether the quality of his representation was affected by the fact that the listing agent was with his brokerage.

“I don’t know what their thinking was. I can just go by (the fact that) I was left on the lawsuit and the other agent was not put on it and I did get the promises that I would be taken off and that never happened,” he said. “I’m told now that I came off only because the plaintiff’s attorney has become aware that I’m not the listing agent, but … they supposedly knew that a long time ago.”

Launiere said he had never been sued before, and now he knows to get his own legal representation right at the beginning.

“I would definitely not wait if something happens like this again,” he said.

One side effect of this case, Launiere said, is that he has heard many “horror stories” from people, including presidents of state associations, in the past few days about the many lawsuits no one hears about because they are settled. Often these involve copyright holders who go after everyone who reposts an image, he said, and admits he is now “a little paranoid” about sites like Pinterest that allow users to “pin” images.

Launiere said he would not re-post IDX listings on his site until his MLS removes the “remarks” field from the IDX feed. He said there’s “no way of knowing” what effect not having home listings on his website has had on his business, though he expects he may lose business from buyers who are no longer receiving automatic notifications from saved searches and from sellers who may surmise he is not the best Realtor to hire based on his lack of listings.

While he can post his own listings, his website will lose out on the search engine optimization benefits of IDX and therefore show up lower on Google or Yahoo, he said.

“If I was a seller, I probably wouldn’t list with an agent that doesn’t have an IDX feed on their website,” he said.

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