New Case Facing National Association of Realtors Covers the Entire Country

By Ryan Ori
CoStar News

The National Association of Realtors, as it vows to appeal a multibillion-dollar verdict over agent commissions in Missouri, was hit with a new, larger lawsuit that adds to its challenge of maintaining its members’ longstanding practices for selling homes.

A jury in a federal courtroom in Kansas City reached a nearly $1.8 billion verdict Tuesday against the NAR and two brokerages, Keller Williams and HomeServices of America, over the practice of home sellers paying commissions to buyer and seller brokers in a process that Missouri home sellers argued is anticompetitive and artificially drives up home costs.

Pending appeals that HomeServices said it will pursue and Keller Williams indicated it’s considering, those damages would be trebled, or effectively tripled, to almost $5.4 billion because of the antitrust nature of the case. That suit has been closely watched because of its potential to affect the national home market and the broader economy.

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New Legal Action

Defendants named in the subsequent case, filed by a new group of home sellers, are the NAR, Compass, eXp World Holdings, Redfin, Weichert Realtors, United Real Estate, Howard Hanna Real Estate and Douglas Elliman, Ketchmark told CoStar News.

For the NAR, it complicates what already is expected to be a yearslong effort to appeal the initial verdict and defend itself in upcoming cases, including one expected to go to trial next year in another federal courtroom.

Industry professionals had previously predicted the NAR could face more exposure if it doesn’t settle ongoing lawsuits or reach a settlement.

A recent report by Keefer, Bruyette & Woods research analysts heading into the Missouri trial estimated that an expansion of lawsuits throughout the country could up the potential damages against the NAR and other defendants to more than $400 billion.

The NAR and HomeServices said they plan to appeal Tuesday’s verdict and Keller Williams is considering it. They also are preparing for a case, Moehrl v. NAR, that’s expected to reach a federal court in Chicago next year, with potential damages of about $41 billion.

Two other defendants, Anywhere Real Estate and RE/MAX, previously reached settlement agreements in the cases for more than $138 million combined.

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Weighing Options

“It’s been a long-running effort to have sellers pay buyer brokers, and that’s wrong,” Ketchmark said. “The jury agreed.”

Damages chosen by the jury in the Missouri case are monetary and do not require changes in business practices, Ketchmark said, but he said he planned to seek injunctive relief to change business practices of the NAR and major brokerages.

The NAR vowed in a statement to CoStar News to appeal soon after the verdict was announced.

For full article and other Commercial Real Estate stories, visit CoStar News.