If the U.S. Department of Justice (DOJ) didn’t know the difference between open and closed, the National Association of REALTORS® (NAR) made sure to tell them.
The legal battle between the two parties resurfaced after NAR filed a motion in U.S. District Court on Nov. 12, using the DOJ’s words against them.
“The Antitrust Division has now confirmed that it entered into a binding settlement with NAR, under which it ‘did agree to issue a closing letter confirming to NAR that it had closed an investigation of two NAR practices.’ The Antitrust Division’s open investigation of those same practices—NAR’s Participation Rule and Clear Cooperation Policy—is a material breach of that settlement agreement,” read an excerpt from the filing.
The motion, which repeatedly highlighted the words “open” and “close,” claimed that “the plain language of the settlement agreement” requires the Antitrust Division to close its investigation concerning the two NAR practices.
NAR even included the Merriam-Webster dictionary definition of the words to drive its point home against the DOJ, which opted to withdraw from the two parties’ antitrust settlement agreement in July.
This latest volley in the legal battle between the DOJ and NAR comes a month after the former alleged that it never committed to refrain from further investigation into the association and its practices.
That October motion argued that the agreement that the Justice Department withdrew from in July wasn’t finalized.
The DOJ admitted in its October petition that it sent a letter to NAR confirming that it closed an investigation of NAR’s two practices. However, the department claimed that the letter didn’t include a commitment to refrain from future investigations.
The Justice Department declined to comment on this story. However, the department has said in past statements that “the proposed settlement will not sufficiently protect the Antitrust Division’s ability to pursue future claims against NAR.”
“Real estate is central to the American economy, and consumers pay billions of dollars in real estate commissions every year,” said Acting Assistant Attorney General Richard Powers of the DOJ’s Antitrust Division in a July statement. “We cannot be bound by a settlement that prevents our ability to protect competition in a market that profoundly affects Americans’ financial well-being.”
NAR lambasted the DOJ in its latest filing, claiming that the federal department tried to “modify the plain terms of the agreement” by claiming it reserved the authority to investigate NAR’s policies in its closing letter.
“If the Antitrust Division wanted to reserve some right to future investigation, it should have asked for that to be included in the agreement, and the parties could have negotiated that term; it never did. Instead, it unconditionally accepted NAR’s settlement proposal, which did not include such a limitation, and that means that there was no such reservation in the settlement agreement,” read an excerpt from the NAR filing.
In a recent statement, NAR maintained that the DOJ’s decision to back out of a “fully binding and executed agreement goes against public policy standards and consumer interests.”
“NAR is moving forward on the pro-consumer measures in the agreement and remains committed to regularly reviewing and updating our policies for local broker marketplaces in order to continue to advance efficient, equitable, and transparent practices for the benefit of consumers,” said NAR spokesman Mantill Williams.
Williams suggests that allowing the DOJ to backtrack on the settlement would undermine public confidence that the government will keep its word. He added that the move would also undermine the pro-consumer changes advanced in the agreement.
NAR made several changes to its guidance for local Multiple Listing Service broker marketplaces at its Board of Directors meeting on Nov. 15.
Pro-consumer changes adopted Monday include:
Reinforce that local marketplace participants do not represent brokerage services as free.
Ensure disclosure of compensation offered to buyer agents.
Ensure listings aren’t excluded from search results based on the amount of payment offered to buyer agents.
At the time, NAR President Charlie Oppler stated that changes, “more explicitly state what is already the spirit and intent of the NAR Code of Ethics and local broker marketplace guidance regarding consumer transparency and broker participation.”
“This is another example of NAR constantly evolving to ensure pro-consumer, pro-competitive marketplaces for buyers and sellers, and brokers,” Oppler previously said.
Jordan Grice is RISMedia’s associate online editor. Email him your real estate news to jgrice@rismedia.com.
