Editor’s note: The COURT REPORT is RISMedia’s weekly look at current and upcoming lawsuits, investigations and other legal developments around real estate.
Only a couple weeks into 2024, there continue to be new twists and turns in the legal landscape for real estate professionals. After a number of new lawsuits cascaded across the country in the wake of the Burnett ruling, the focus seems to have turned toward consolidation and appeals, with defendants in Burnett filing new post-trial briefs and other cases delayed ahead of those appellate decisions.
But that doesn’t mean plaintiffs are giving up, with more new lawsuits filed and continued pressure on the industry. Some defendants are also finding ways to remove themselves from lawsuits, though the exact reasons for these moves are varied or unclear.
Here is a recap of recent real estate news and developments from the courtroom:
Burnett defendants unleash fusillade of post-trial motions
In a concerted full-court press of filings, defendants in the Burnett case are seeking to overturn the jury verdict delivered back in October that found them liable for $1.8 billion, demanding the judge throw out the verdict, order a new trial or de-certify the class.
The filings, which were entered last week, come ahead of any appellate proceedings as the judge in the case has not yet come to a final decision on the verdict, in which he could potentially triple the damages.
But the push marks a new phase in the overall battle against separate but similar claims of price-fixing and conspiracy leveled against organized real estate, with HomeServices EVP Chris Kelly calling a reversal of the verdict “paramount” for protecting consumers and reversing the course of other ongoing lawsuits.
Mike Ketchmark, lead attorney for the plaintiffs, told RISMedia he has “zero concern” about these new filings.
Arizona, Illinois and the Big Apple are the site of new suits
Three class-action lawsuits filed within the last month appear to be following the same playbook as the Burnett case, accusing local associations of enforcing the same rules that allegedly inflate commissions.
Notably, one of these cases names REBNY, the independent real estate board—unaffiliated with the National Association of REALTORS® (NAR)—which oversees the New York City market. This is the second lawsuit in that jurisdiction, with every other suit incorporating NAR-affiliated markets.
The Arizona case does not name NAR, but instead applies the same accusations to the state association, only naming NAR as a “co-conspirator.”
In the Illinois case, the plaintiff is a recent homebuyer, rather than a seller, as the plaintiffs in most of the class-action suits have been. This suit, recently moved to the same district as two other major complaints (namely, Batton and Moehrl) is also unique in that it names only a single brokerage as a defendant—@properties, which is the largest residential brokerage in the state.
Court approves RE/MAX and Anywhere settlement notices
Two companies who chose to settle the Burnett case (and another upcoming lawsuit, known as Moehrl) are one step closer to being able to put at least some of this litigation behind them, as a judge approved the notice meant to inform recent homesellers that they may be entitled to compensation.
The settlements are still pending final approval, which will likely take place after a hearing on May 9 of this year. Any member of the class can speak at the hearing to dispute the terms of the agreement, which required the two companies to change practices and pay out $137 million to these recent homesellers.
Because the settlement includes both Moehrl and a third case, known as MLS PIN, the dates and covered areas vary widely, spanning all the way from 2014 to early this year, and MLSs from Utah to Massachusetts. It was not clear how much money individual homesellers will eventually receive.
California suit removes NAR
A lawsuit filed back in December in California, mostly a copycat of Burnett, amended its initial complaint to exclude NAR and add several other brokerages.
The suit, known as Grace after its lead plaintiff, made the change late last week, adding Windermere, REALTY One and three other local brokerages as defendants, while removing NAR (though the national association is now named as a “co-conspirator”).
The substance of the complaint is mostly unchanged, though it appears language connecting BAREIS MLS (which is also a defendant) to the defendant brokerages and NAR has been significantly tweaked, emphasizing specifically how the companies in question mandate NAR membership or copy NAR rules. There is also more of a focus on BAREIS, with the amended suit including 20 more references compared to the original filing.
It was not immediately clear why these changes were made, or why NAR was removed as a defendant. Plaintiffs’ attorneys did not immediately respond to a request for comment.
