After a failed motion to dismiss in September, Compass is looking to end its nearly six-month-long battle with Realogy outside of the courtroom.
Compass filed a motion to stay on Nov. 25, claiming the majority of Realogy’s accusations come from The Corcoran Group, a fellow Real Estate Board of New York member, according to a report by The Real Deal.
As a REBNY member, Compass said Realogy must follow REBNY’s code of ethics and universal co-brokerage agreement, which requires “members associated with different firms [with disputes] arising out of their professional activities to submit the dispute to arbitration.”
“Most of the causes of action in this case have been brought by Plaintiff NRT New York LLC, a real estate brokerage doing business as The Corcoran Group,” the motion read. “Corcoran’s obligation to arbitrate its disputes with Compass flows from multiple, separate binding arbitration clauses, which New York courts have interpreted to require arbitration of similar disputes.”
In the July filing, Realogy accused Compass of a number of “unfair business practices and illegal schemes” that included an illicit price-fixing deal and offering “inflated” compensation packages to Realogy-affiliated agents in order to gain access to confidential and proprietary information.
“Compass instructs and encourages its recruits to interfere directly with Plaintiffs’ existing contracts and with other business relationships by inducing Plaintiffs’ employees to breach their non-solicitation and non-compete agreements while promising to indemnify employees if and when they are sued,” Realogy alleged, according to a previous Inman article.
In the motion, Compass argued Realogy’s poaching claims came from The Corcoran Group, meaning they’d need to be resolved using REBNY rules.
“For example, Corcoran alleges that Compass — a competing real estate brokerage — ‘interfered’ with exclusive listing agreements between Corcoran and certain property owners, when the individual agents who listed those properties chose to leave Corcoran to join Compass,” the court documents explained.
“Those exclusive listing causes of action — and, indeed all others brought by Corcoran in this litigation, such as those related to Compass’ hiring of Corcoran’s employees — are subject to mandatory arbitration.”
In addition to filing a motion of stay, Compass filed a motion to dismiss Realogy’s amended complaint, saying that Realogy is trying to shift the blame for an “eroding market share and falling stock price” and that Realogy is simply “repackaging claims” from a settled 2015 lawsuit between Citi Habitats, Corcoran and Compass.
Compass declined to comment through a spokesperson. A Realogy spokesperson was not immediately available for comment.
Read the full filing below.