The case against the Toronto Real Estate Board that wound it’s way through the Canadian court for seven years, before the Real Estate Board lost their case. If so, the government may take their cues from a similar case in Canada. Undoubtedly NAR will likely defend themselves all the way to the Supreme Court. It’s unknown what the ultimate outcome will be. The potential here is that the DOJ will deem NAR’s privacy policies, as being anti-competitive and a violation of the Sherman Anti Trust Act. This includes any policies, criteria, guidelines or practices that prevent the Core Logic from sharing data with non MLS parties. The second set of information the DOJ is seeking is, evidence of anti competitive procedures. DOJ Wants Copies of Policies and Procedures What if the data reveal that agents do in fact query for the amount of commission? It will be evidence to support the plaintiff’s suit. In particular, the DOJ is looking for queries regarding the amount and type of commission the buyer’s agent would receive. The DOJ’s intent is to search for the frequency and percentage of queries by agents. What the DOJ wants now, is the complete set of data the Core Logic has from every MLS. Unlike the past, today’s buyers do most of their looking at homes online, before ever making an offer. They contend that with the advent of the Internet, the role of the buyer’s agent has been significantly reduced. It is the plaintiffs’ position that this rigs the system and forces sellers to pay a higher commission to buyer’s agents. The crux of the lawsuit is the belief that buyer’s agents avoid showing houses that pay less commissions. Realtors® have been able to see this data readily, and have been able to query for houses that pay higher commissions. However, much of the data is confidential and not shared outside of the Core Logic, or the various MLS service providers. When the data is aggregated, it provides significant insights into the real estate sector. It also includes the queries agents make of the MLS. The data includes the the amount of commission the buying and selling agents receive, as well as concessions and private agent remarks. This data contains detailed information about the transaction information for the sale of every home in the MLS. Core Logic is a data warehouse company that receives data from each of the MLS vendors in America. The lawsuits have also caused the Department of Justice to demand the records the Multiple Listing Service (MLS) vendors from Core Logic.Ī little explanation is needed here regarding Core Logic.
The combined suit goes on to say this rule, “encourages and facilitates anticompetitive ‘steering’ by buyer-brokers because it allows them to compare the terms offered for buyer-broker compensation and steer their clients to properties where the seller-broker is offering higher commissions.” Department of Justice Gets Involved The new combined suit states that per NAR and MLS rules, “the exact same compensation terms must be simultaneously offered to every buyer-broker without regard to their experience, the services they are providing to the buyer, or the financial arrangement they have made with the buyer.” Combined Class Action Lawsuitsįirst, the two plaintiffs have combined their lawsuits. In the past month, the suit has heated up. Specifically, by not allowing buyers to negotiate the amount of commission their agents receive. Two different lawsuits allege that NAR has engaged in anti competitive practices. We recently wrote about the class action lawsuit against the National Association of Realtors. By Robert Taylor (updated on May 10, 2020)
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