By Jordan Grice | RISMedia
Burnett/Sitzer et al. v. National Association of REALTORS et al.
While this is another courtroom battle pitting home sellers against NAR and several top real estate franchisors, a court decision designating it as a class-action lawsuit has moved the needle forward for the Burnett v. NAR case—formerly Sitzer v. NAR.
The lawsuit features the same allegations and defendants as Moerhl v. NAR, but its scope centers around Missouri. Moerhl extends across multiple states.
Nevertheless, the case could send ripples throughout the industry as the plaintiffs look for the court to do away with the Participation Rule and prohibit the creation of similar policies. The recent class-action designation also opens the door for “hundreds of thousands” of home sellers to join in on the lawsuit if they paid a broker commission in transactions involving a listing featured on one of four local MLS.
What we know
- The lawsuit was initially filed in April 2019 by Joshua Sitzer and Amy Winger.
- Scott and Rhonda Burnett joined the lawsuit after the initial filing and several other home sellers.
- Defendants named are NAR, Realogy, RE/MAX, Keller Williams, and HomeServices of America—including its subsidiaries BHH Affiliates and HSF Affiliates.
- The lawsuit also targets Heartland MLS, Columbia Board of REALTORS® (CBOR) MLS, Mid America Regional Information System (MARIS) or the Southern Missouri Regional MLS.
- The “Participation Rule” or “Buyer Broker Commission Rule” is at issue.
- U.S. District Court Judge Stephen R. Bough is presiding over the case.
- Plaintiffs allege that the defendants conspired to inflate commissions by requiring all seller brokers to “make a blanket, unilateral and effectively non-negotiable offer of buyer broker compensation.”
- That lawsuit argues that buyers’ agents wouldn’t show clients a listing based on the commission offered.
- The lawsuit also claims the alleged “conspiracy forces home sellers to pay a cost that, in a competitive market and were it not for Defendants’ anticompetitive restraint, would be paid by the buyer.”
- Plaintiffs filed the lawsuit as a class action on behalf of home sellers who paid a broker commission in the last four years in connection with the sale of residential real estate listed on one of four MLSs listed above.
- Plaintiffs are seeking payment for damages and the court to restrict NAR and company from “requiring that sellers pay the buyer broker.”
What’s at stake?
“In April, a federal judge in Missouri granted class certification in the Sitzer/Burnett suit. We are still awaiting a decision in Moehrl, but this in no way reflects on the actual or perceived merits of their claims,” said a NAR spokesperson.
“The ruling was procedural, and the effect of the ruling is limited in that it now allows others who have allegedly been affected to join the litigation as plaintiffs. As is common and expected, at this point, class action attorneys begin to recruit members of the ‘class’ even before the validity of the case has been decided. While we understand this can be jarring, it in no way changes the facts of the case or our confidence that we will win in what is yet to be a lengthy process.”
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Related:
Lawsuits Threatening Agent Commissions: Moehrl v. NAR
Lawsuits Threatening Agent Commissions: REX v. Zillow & NAR, et al.
Lawsuits Threatening Agent Commissions: PLS.com v. NAR