The National Association of Realtors is asking a federal court to throw out a lawsuit filed by an Arizona real estate broker alleging antitrust violations over rules regarding listing broker attribution.
In September, broker Grady Hillis of Grady Hillis Realty in Lakeside, Arizona, filed a lawsuit in Arizona’s U.S. District Court against NAR, the Arizona Association of Realtors and the White Mountain Association of Realtors (WMAR), alleging the associations had been redacting information about the listing agent and/or broker out of his sales listings when an emailed copy is sent to a potential buyer.
In a Feb. 24 motion to dismiss, NAR took aim at Hillis’s Jan. 25 amended complaint, which seeks $1.18 billion in punitive damages — a figure Hillis reached by multiplying the amount of dues he pays the Realtor associations in one year ($843 total) times 1.4 million Realtors.
The amended complaint came to 1,295 pages and includes 1,013 separate counts alleged against the Realtor associations — an extremely unusual length for a legal complaint. The complaint appears to repeat the same allegations for each listing in which Hillis’s contact information was removed from the listing description in the WMAR multiple listing service.
“From the face of the Amended Complaint, NAR cannot understand the nature of the claims Plaintiffs are asserting against NAR, discern Plaintiffs’ legal theories, or meaningfully admit or deny Plaintiffs’ repetitive and confusing allegations,” NAR’s attorneys wrote in the motion to dismiss.
“The Amended Complaint therefore fails to provide the ‘short and plain’ statement of Plaintiffs’ claims that is required …”
Hillis’s claims against the associations include breach of contract, negligence, tortious (wrongful) interference with a contractual relationship, aiding and abetting tortious conduct, and violations of the First Amendment and antitrust laws.
In the motion to dismiss, NAR’s attorneys point to several “substantive defects” in the complaint they said are “fatal” to Hillis’s claims.
“Plaintiffs assert breach of contract claims against NAR, but they never identify a contract between a Plaintiff and NAR that could have been breached,” they wrote.
“Plaintiffs assert antitrust claims against NAR, but they fail to make any of the required factual allegations,” such as defining a relevant market, identifying an allegedly anti-competitive agreement, and describing how NAR’s alleged actions harmed competition.
“Plaintiffs assert First Amendment claims against NAR, but NAR is not a government actor,” they added. “Plaintiffs assert negligence claims, but they identify no duty owed to them by NAR.”
Regarding the tortious interference and aiding and abetting claims, NAR’s attorneys said the complaint had alleged no facts showing NAR took any action to induce a breach of Hillis’s contracts.
MLSs across the country have long had rules in place prohibiting listing agent contact information from appearing in listing descriptions, prompting ire from some brokers. Last year, California Regional MLS (CRMLS) and NAR adopted online display policies that sought to further clarify who the listing agent or broker is on a listing.
Hillis’s complaint also said that the defendants require that Supra lockboxes be used on homes for sale and that only members of WMAR can use the lockboxes — a rule the broker alleged was anti-competitive. The U.S. Department of Justice (DOJ) and discount brokerage REX Real Estate have made similar allegations.
While the complaint originally included lockbox company Supra and MLS vendor FBS as defendants, Hillis voluntarily dismissed the companies from the case in mid-February.
Hillis and his attorney, Eduardo Coronado, did not respond to emailed requests for comment.
