By Brooklee Han, Sarah Wheeler and James Kleimann
A Kansas City jury has found the National Association of Realtors, HomeServices of America and Keller Williams guilty of colluding to inflate or maintain high commission rates through NAR’s Clear Cooperation Rule, in the Sitzer/Burnett buyer broker commission lawsuit.
The defendants have been ordered to pay damages of $1.78 billion. Treble damages could result in the NAR and brokerages paying roughly $5.36 billion. It also opens the door to additional potential copycat lawsuits being filed in other states.
The jury reached its verdict after a little over two weeks of testimony from the plaintiffs and defendants. During their testimony, the home seller plaintiffs and their lead attorney Michael Ketchmark argued that despite the defendants having antitrust rules and regulations in place, the trade group and corporate brokerages knowingly violated their own rules in order to maintain high commission rates.
Judge Stephen Bough, who is overseeing the suit, still needs to issue his final judgement on the case, before the verdict is final. He has wide latitude in issuing injunctive relief.
In the worst case scenario for the defendants, Bough could ban the cooperative compensation rule nationally on the multiple listing services, which would prevent listing agents and home sellers from predetermining buyer agent commission rates. Listing agents would also be prohibited from sharing commissions with buyer agents, and buyer agent commission rates would not be published in the MLS.
Alternatively, Bough could also keep elements of the rule in place and require an offer of at least one cent in “cooperative compensation” MLS field.
