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Celebrity broker and The Agency founder Mauricio Umansky has revived a simmering lawsuit that takes aim at rules created by the National Association of Realtors, arguing the rules help maintain unfair dominance over the nation’s multiple listing services.
The new lawsuit, filed in the U.S. District Court of Southern California by Umansky’s private listing network ThePLS.com, boils down to a few key arguments:
- Umansky alleges NAR controls competition in the residential real estate industry by controlling a large network of MLSs in the country.
- Namely, the Clear Cooperation Policy that requires listings to be placed on an MLS within one business day limits competition from companies seeking to offer private listings that are marketed outside the MLS.
- The policy stymied efforts by would-be competitors, like Umansky’s ThePLS.com, to give brokerages a new way to discreetly market homes for sale.
“The surge in consumer demand for pocket listings, and the rise of a listing network to market pocket listings effectively, was a competitive threat to the viability of the NAR-affiliated MLS system,” ThePLS.com wrote in its complaint, filed overnight on Tuesday. “These market changes also threatened NAR’s ability to control competition in the residential real estate brokerage industry.”
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The federal antitrust lawsuit keeps pressure on NAR and its affiliated MLSs, and shows that the industry will remain engaged in a fierce debate over the rules — especially those governing private listings — that will guide the next chapter of the real estate industry.
Compass, the No. 1 largest brokerage by sales volume, last week filed a lawsuit against Zillow, the nation’s largest real estate portal by unique visitors. Compass is taking aim at updates to Zillow’s policies that require listings to be filed on the MLS and therefore on Zillow within one business day.
Compass is making the claim that Zillow is a monopoly and that its policy is anticompetitive because it prevents the company from growing its network of Private Exclusive listings, which are homes for sale and only accessible through a Compass agent. The network itself is marketed on Compass’ website, which is a violation of Zillow’s new standards.
The newly filed lawsuit keeps a target squarely on NAR and the Clear Cooperation Policy.
“Through the Clear Cooperation Policy, NAR and the MLS conspirators eliminated the possibility of a more competitive future in the market for residential real estate listing network services,” ThePLS.com wrote in the complaint. “A once-in-a-lifetime opportunity for competition in a monopolized market has been lost. NAR’s conduct has harmed competition and consumers, and is illegal.”
What is NAR saying?
The new filing actually represents the refiling of a case that Umansky and NAR fought over beginning in 2020, shortly after NAR adopted its Clear Cooperation Policy. NAR said that PLS had walked away from the negotiating table before filing its suit overnight, and it defended its Clear Cooperation Policy.
“NAR and PLS were in discussions to extend this agreement until PLS ceased to engage,” an NAR spokesperson said in a statement to Inman. “The Clear Cooperation Policy promotes transparency and competition in the real estate marketplace while still providing home sellers and their agents the option to list their property as an office exclusive.”
More context
After years of debate, NAR opted to keep Clear Cooperation in March, but at the same time rolled out a new policy to allow for the delayed marketing of a listing without violating the rule.
The update was an effort to balance criticisms of the policy, but it received mixed reviews among industry insiders.
ThePLS.com filed it’s first lawsuit against NAR in 2020, shortly after the trade organization first adopted the Clear Cooperation Policy.
NAR and ThePLS.com previously reached an agreement that dismissed the case but kept open the possibility of it being filed again at a later date.
“Where we landed is that we gave them a tolling agreement on the statute of limitations to give us time to figure out whether or not we were amenable to repealing the Clear Cooperation Policy,” former NAR outside legal counsel Ethan Glass said at a hearing in 2024.
Over the years, Umansky has challenged NAR in other ways as well.
Early last year, he was part of a team that launched the American Real Estate Association, a group that intends to compete with NAR.
“Right now I don’t feel like anybody is caring; we’re in a lot of trouble,” Umansky said at the time, arguing at another point, “We need better advocacy, we need better lobbying, we need to make sure we’re taken care of.”
Update: This post was updated after publication to add additional clarity.
