Another commission lawsuit is facing the National Association of REALTORS® (NAR), this time including Redfin and the California Association of REALTORS® (CAR).
Referred to as the Freedlund suit, brought by sole Plaintiff Andrea Freedlund, the case, filed Tues., Feb. 26 in U.S. District Court in the Central District of California, alleges—yet again—that defendants conspired to inflate agent commissions.
Freedlund, who is pushing for class-action status, sold her home in Laguna Niguel, California, in the late days of September 2021. She was represented by a Redfin agent, which makes this the first time that Redfin is the only national brokerage defendant in a commission lawsuit.
According to court documents, “These proceedings demonstrate the palpable illegality of Defendants’ scheme, and the early settlements by major REALTOR® groups reflect the viability of the claims in those cases.”
The preliminary statement claims a vast effect on California middle-class residents who use significant sums of their life savings to purchase homes.
The plaintiff is pursuing permanent and public injunctive relief as well as compensatory and treble damages—in addition to a jury trial.
Redfin, who is a defendant along with Compass, United Real Estate and Douglas Elliman in another Burnett copycat case known as Gibson most recently noted that their brokerage model is focused on discounting commissions, and shared the following with RISMedia in an emailed statement:
“For its entire two-decade history, Redfin has existed to give real estate consumers a better deal. We’ve saved consumers more than $1.6 billion in real estate fees. We’ve advocated for reforms to make real estate more transparent and drive down commissions. While Redfin hasn’t been served in this case, we’ve reviewed the complaint and will vigorously defend against the allegations. And as we’ve stated before, we don’t belong in any of these lawsuits. There is a complete disconnect between our business model and claims that we conspired to maintain inflated commission rates.”
Additionally, the company has openly attempted to disaffiliate from NAR, and noted in Gibson filings that it has advocated for rule changes in Gibson, including the rules pertaining to mandatory offers of buyer compensation.
“Redfin inexplicably finds itself accused of participating in a conspiracy to artificially inflate commission rates in these two putative nationwide class-action lawsuits,” lawyers for the company wrote in that case. “Regardless of the merits of Plaintiffs’ challenges to NAR’s rules, Redfin’s history…makes its inclusion as a defendant in these lawsuits wrong both as a matter of common sense and as a matter of law.”
