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A courtroom showdown between attorneys representing homesellers nationwide and those representing the National Association of Realtors and major real estate franchisors Anywhere, Keller Williams, RE/MAX and HomeServices of America is likely headed to trial in the first half of next year, the judge in the case said Tuesday.
Judge Andrea R. Wood
In a telephonic status hearing May 30, Judge Andrea R. Wood of the U.S. district court in Chicago, where NAR is based, said she expects to set a trial date sometime between September and mid-October of this year and the date “would likely be sometime in the end of the first quarter or the second quarter of 2024.”
The suit, known as Moehrl after the lead plaintiff, alleges that some NAR rules — including one that requires listing brokers to offer buyer brokers a commission in order to list a property in a Realtor-affiliated multiple listing service (MLS) — violate the Sherman Antitrust Act by inflating seller costs. If the plaintiffs prevail, that NAR rule would likely go away, which could upend how buyer agents are paid throughout the industry. NAR has 1.5 million members nationwide; the vast majority are residential real estate agents and brokers.
No MLSs are defendants in the case, meaning they are not being sued, but the suit does allege 20 MLSs nationwide are “co-conspirators” with NAR and the franchisors.
The suit went one step closer to trial last week when a federal appeals court denied NAR and the franchisors’ request for permission to appeal Wood’s ruling granting class-action status in the case, which was originally filed in 2019. Because of that denial, the suit will proceed as a class action, meaning that potentially millions of homesellers in 20 MLS markets nationwide can ask to be reimbursed for an estimated $13.7 billion in damages. If the court awards treble damages — or three times the actual damages — that figure could go up to $41.1 billion.
At the May 30 hearing, Wood set the next telephonic status hearing for Aug. 2. She said that by then she hopes to have ruled on pending requests from the defendants that some class members’ claims be resolved through arbitration. She also said as the trial gets closer, she will want to switch to in-person hearings, perhaps starting in September.
“I do believe when we are discussing some of the issues leading up to trial it will make sense for us to have those hearings in person,” Wood said.
Kenneth Kliebard
She then asked the attorneys present on the call how long the trial for a similar federal case in Missouri known as Burnett (formerly, Sitzer) — which is also a class action — is scheduled to last once it starts on Oct. 16.
“I believe we have three weeks in that case that Your Honor may recall is a smaller case in terms of the geographic reach: The number of MLSs is four and it’s five-fold that in this case,” said Kenneth Kliebard of Morgan Lewis & Bockius LLP, an attorney for Anywhere (formerly, Realogy).
Wood then asked if that meant the trial was expected to wrap up sometime in early November and Kliebard replied in the affirmative.
That trial length suggests that if the Moehrl suit is not settled, the case is in for an even longer trial in the first half of 2024.
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