Attorneys say the groundbreaking settlement could save consumers billions of dollars a year in broker fees, transform US housing market
Today, Hagens Berman announced a settlement agreement with the National Association of Realtors (NAR) which would resolve antitrust claims against NAR in a class-action lawsuit alleging that it conspired with the Big Four real estate broker franchises to artificially inflate commissions associated with home sales.
If you sold your home in the last five years, find out your rights.
The lawsuit, which was originally filed March 6, 2019 in the U.S. District Court for the Northern District of Illinois, was the first in a series of lawsuits against NAR and other real estate kingpins alleging illegally inflated broker commissions. Hagens Berman was the first to file the nationwide case against NAR and the Big Four, and many other cases followed. This settlement agreement with NAR, the third settlement in this case, resolves the Moehrl, Burnett, Gibson and Umpa matters. The settlement, which only resolves claims against NAR, is valued at $418 million and brings the firm’s total settlements in this matter to $626 million, with a number of remaining defendants left.
“We started this case to challenge NAR rules that prevent competition on commissions for home sales in the United States for homes listed on multiple listing services,” said Steve Berman, managing partner at Hagens Berman and the attorney leading the case. “This settlement changes those rules so that competition will occur at the commission level. Mission accomplished.”
Real Estate Brokers Will Now Compete in a Free Market
The settlement includes significant, comprehensive injunctive relief, including the following:
- NAR has agreed to prohibit listing brokers from offering buyer broker compensation through multiple listing services (MLSs), including a prohibition on offers of compensation being displayed on MLSs.
- Buyer brokers will be required to enter into buyer representation agreements that clearly spell out the compensation that they will receive from buyers.
- NAR has agreed to make other changes to ensure that sellers and buyers always receive full, complete disclosures about broker compensation.
Attorneys say these changes comprehensively address the central anticompetitive conduct challenged by these lawsuits – buyer brokers steering their clients based on the offer of buyer broker compensation made by sellers.
Due to the terms of the settlement agreement, buyer brokers will no longer be able to pick and choose which listings they show clients based on the offers of compensation that are made through the MLS. And sellers will no longer be required to make an offer of compensation in order to market their homes to potential buyers.
Hagens Berman believes that these fundamental reforms are likely to lead to significant changes in how real estate brokers are compensated in the United States, including potentially lowering broker commission rates that are higher in the United States than anywhere else in the world. Attorneys say that brokers will now compete in a free market, where they are compensated based on the value of the work they perform, not based on the threat that sellers will be unable to sell their homes unless buyer brokers are compensated at an inflated rate.
Hagens Berman is a global plaintiffs’ rights complex litigation law firm with a tenacious drive for achieving real results for those harmed by corporate negligence and fraud. Since its founding in 1993, the firm’s determination has earned it numerous national accolades, awards and titles of “Most Feared Plaintiff’s Firm,” MVPs and Trailblazers of class-action law. More about the law firm and its successes can be found at www.hbsslaw.com. Follow the firm for updates and news at @ClassActionLaw.
View source version on businesswire.com: https://www.businesswire.com/news/home/20240315197932/en/
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