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A group of homesellers this week filed a new antitrust commission lawsuit against several multiple listing services and brokerages — the best known of which is Side — and have also already reached a proposed settlement in the case.
Homesellers filed their case Monday in Missouri. The lead plaintiff in the case is a homeseller named Jeremy Keel, but additional sellers including Rhonda Burnett, Don Gibson, Daniel Umpa and Christopher Moehrl — all of whom are lead plaintiffs in other high profile cases — are also listed among the plaintiffs.
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The case generally hues closely to other antitrust suits, accusing the defendants of engaging in a conspiracy that inflated consumer costs and of breaking antitrust laws.
However, the case is atypical compared to other similar suits because the plaintiffs and the defendants filed a proposed settlement the same day that they filed their complaint. The settlement would see the defendants pay a total of $10,570,000.
The defendants in the new case, along with their individual settlement amounts, include:
- Side: $5.5 million
- Washington Fine Properties: $1.3 million
- Seven Gables Real Estate: $1 million
- First Team Real Estate — Orange County: $1,000,000
- Signature Properties of Huntington: $850,000
- Cairn Real Estate Holdings, the parent of J.P. Piccinini Real Estate Services (JPAR): $700,000
- Central New York Information Service: $125,000
- Brooklyn New York MLS: $95,000
News of the suit and settlement was first reported by Real Estate News.
In addition to making monetary payments, the defendants have agreed to make the same changes to their practices that were outlined in the Gibson and Sitzer | Burnett settlements. The motion outlining the new proposed settlement notes that it is “substantially similar to those reached in Gibson and Burnett.”
Keel and the other homeseller-plaintiffs filed the case in the same federal district court that has handled the Gibson and Sitzer | Burnett cases, though a different judge — Fernando J. Gaitan, Jr. — is overseeing the suit.
In a statement to Inman, Side confirmed that it had “reached a settlement related to the commission lawsuits, agreeing to pay $5.5 million to resolve all claims against Side.
“While Side strongly denies any wrongdoing, we’re glad to have this matter resolved so we can stay laser-focused on providing our community of top-producing boutique owners with the best possible experience on the Side platform,” the statement added.
Michele Harrington, CEO of First Team Real Estate, also provided a statement to Inman.
“As far as the settlement goes, it’s bullshit we were ever put into this situation,” Harrington said in the statement. “The Department of Justice had no business getting involved in our industry, opening the doors to these unscrupulous, greedy attorneys who have done no good for the industry or for consumers but lined their pockets with the money of hard-working people. I’m disappointed in NAR for excluding us in their settlement and I’m disappointed in our system. Class actions were not set up to be a shakedown, a form of extortion to make a few people rich. I hope we will see reform in this area but I won’t be holding my breath.”
Inman has reached out to the other defendants in the case and will update this story with any responses they provide.
The new case and settlement come as much of the industry adapts to a new normal defined by settlement-prompted rules. Those rules came about after the National Association of Realtors settled its part in various antitrust commission cases last March. As part of that settlement, the organization agreed to pay $418 million and make various rule changes — changes that went into effect last August.
Though members of the real estate industry have largely been critical of the various antitrust cases and their claims, brokers have also in more recent weeks observed possible upsides and opportunities emerging thanks to changing business practices.
Read the complaint in the case here (if the document doesn’t appear, try refreshing the page):
Update: This story was updated after publication with statements from the defendants.