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Franchisors Anywhere Real Estate and RE/MAX have agreed to a proposed settlement in another major commission antitrust lawsuit known as Nosalek, according to legal filings submitted on Monday and Tuesday.
Previously known as the Bauman lawsuit, the case centers on the so-called “Buyer Broker Commission Rule.” Plaintiffs in the case alleged that the broker-owned multiple listing service MLS Property Information Network (MLS PIN), while not required to follow NAR rules, still adopted a rule similar to NAR’s that requires sellers’ brokers to offer compensation to buyers’ brokers in order to submit a listing to the service.
The Nosalek settlements propose that the MLS PIN class members be included in the “substantive terms” of proposed settlements in two other major commission class actions, Sitzer/Burnett and Moehrl.
Both Anywhere and RE/MAX submitted settlements for Sitzer/Burnett and Moehrl in September. While RE/MAX concurrently announced the terms of its $55 million settlement at the time, Anywhere did not reveal the terms of its $83.5 million settlement until early October.
In the proposed Nosalek settlements, plaintiffs and defendants have requested a stay (temporary pause) of 30 days to determine the “appropriate treatment” of the plaintiffs in the case, and to preserve the resources of the plaintiffs, the franchisors, and the court. The Sitzer/Burnett case has been stayed in regards to both Anywhere and RE/MAX. Moehrl has been stayed in regards to Anywhere, and RE/MAX has applied for a stay in Moehrl.
Anywhere’s legal filing notes that the various parties are “presently conferring regarding the appropriate treatment of the Nosalek Plaintiffs and the class they purport to represent.”
Anywhere declined to comment on the record regarding the new legal filing.
In the case of RE/MAX, a spokesperson told Inman in an email that “we are pleased that the Nosalek plaintiffs have agreed that the substantive terms of the Burnett/Moehrl settlement should include the proposed MLS PIN class members in the Nosalek case.”
In early September, Judge Patti Saris of the U.S. District Court in Massachusetts granted preliminary approval of a proposed settlement between the plaintiffs and MLS PIN, which stipulated that the MLS overhaul commission policies, pay $3 million and “cooperate” in ongoing litigation against the other defendants in the suit, which include Anywhere, RE/MAX, Keller Williams and HomeServices of America. The MLS also denied wrongdoing and any liability as part of the agreement.
However, by early October, Judge Saris had approved a two-month deadline extension to review the proposed settlement at the request of attorneys from the Department of Justice’s Antitrust Division. In a filing, DOJ attorneys expressed “significant concerns with the planned rule changes under the Proposed Settlement.”
In addition to paying $83.5 million in relief, Anywhere’s settlement in the Sitzer/Burnett and Moehrl cases saw the franchisor agree to changes related to business practices and commission structure, as well as the ability for company-owned brokerages and agents to cut ties with the National Association of Realtors, if they so chose.
The franchisor — which owns brands such as Coldwell Banker Realty, Corcoran and Sotheby’s International Realty — also said it would prohibit company-owned brokerages from claiming “free” buyer agent services. Anywhere also agreed that company-owned brokerages and affiliated agents would need to include the listing broker’s compensation offer for potential buyers’ agents as soon as possible in active listings, and that it would prohibit company-owned brokerages and affiliated agents from using any type of technology to sort listings by offers of compensation unless the client explicitly requested it.
Anywhere’s settlement further stipulated that company-owned brokerages and affiliated agents would be required to clearly disclose that commissions are not set by law, and are completely negotiable. The franchisor said it would remind brokerages and agents that it has no rule requiring offers of compensation.
In RE/MAX’s settlements for the Sitzer/Burnett and Moehrl cases, the franchisor agreed to settle all claims against the company and pay $55 million out of its available cash resources.
“RE/MAX has now agreed to join Anywhere Real Estate in changing its practices by no longer forcing homesellers to pay buyer’s agents,” Michael Ketchmark, lead trial counsel for plaintiffs in the Sitzer/Burnett case, told Inman in an emailed statement from September. “The $55.0 million dollar settlement focuses on the RE/MAX’s ability to pay. The biggest part of the settlement is the massive changes to RE/MAX’s business practices.
“The time has now come for HomeServices of America, NAR, and Keller Williams to admit they are wrong in continuing to force homesellers to pay buyer’s commissions,” the statement added. “Our experts have shown that NAR’s anti-competitive rules result in doubling the cost of commissions in the United States. This NAR rule has cost homeowners hundreds of billions of dollars in commission over the years and put the dream of hoomeownership out of reach for many Americans.”
The Sitzer/Burnett case went to trial on Oct. 16, 2023 in U.S. District Court in Western Missouri, and is expected to continue potentially through next week.
Read Anwyhere’s proposed settlement in the Nosalek case here:
Read RE/MAX’s proposed settlement in the Nosalek case here: