The U.S. Department of Justice filed a statement of interest Monday in the Moehrl class-action, buyer-broker commission lawsuit. The statement mirrors one filed last week in the class-action lawsuit filed by Joshua Sitzer and other plaintiffs and indicates a wider probe into buyer’s broker commissions.
The U.S. Department of Justice filed a statement of interest Monday in the Moehrl class action buyer-broker commission lawsuit. The statement mirrors one filed last week in the class action lawsuit filed by Joshua Sitzer and other plaintiffs, the smaller of the two buyer broker commission lawsuits.
The National Association of Realtors (NAR) and a slew of real estate brokerages and holding companies are currently fighting the class action lawsuit battle on two fronts.
The suits both allege that the sharing of commissions between listing and buyer brokers violates the Sherman Antitrust Act by inflating seller costs. They seek to have homebuyers pay their broker directly, rather than having listing brokers pay buyer brokers from what the seller pays the listing broker.
Last week, the Department of Justice filed a statement of interest in the lawsuit filed by two law firms on behalf of homeseller Joshua Sitzer and other plaintiffs, that did not take a position on the suit, but seeks to correct what it calls an “inaccurate portrayal” of the 2008 consent decree by the NAR.
On Monday, the first lawsuit – filed by nine law firms on behalf of homeseller Christopher Moehrl and other plaintiffs in the Northern District of Illinois – received the same filing.
NAR makes two references to the consent decree, according to the filing. The association alleges that the consent decree authorizes NAR to “limit membership in an MLS to persons who make offers of cooperation and compensation to other members of the MLS,” the filing reads.
According to the filing, NAR also asserts that other attacks on the rules governing MLSs have been rejected because courts have recognized the efficiency and consumer benefits provided by multiple listing services. The statement then cites the consent decree, noting that NAR is permitted to make MLS membership contingent on a broker’s agreement to actively endeavor, or make and accept offers of cooperation and compensation.
The Department of Justice believes NAR is inaccurately portraying the consent decree in the filing.
“The consent decree resolved the United States’ antitrust claims against NAR for its exclusionary policies targeting brokers using innovative platforms,” the filing reads. “In that case, the United States did not examine the rest of NAR’s policies, including those at issue here, and therefore those policies simply were not subjected to antitrust scrutiny. Importantly, those other policies were in no sense analyzed and found consistent with antitrust laws.”
In the filing, DOJ also acknowledged for the first time that it sent a civil investigative demand to CoreLogic relating to a probe into unidentified residential real estate brokerages, an indication that the scope of its inquiry is larger than previously known.
“Although the United States generally does not comment on the existence or non-existence of pending investigations, it acknowledges that a Civil Investigative Demand relating to an investigation of residential real estate brokerages was published in a trade publication,” the filing reads. “The focus and scope of that investigation, however, have not been publicly disclosed.”
A spokesperson for NAR did not immediately respond to a request for comment.