eXp has joined the list of real estate brokerages and organizations settling the many commission lawsuits filed by homesellers that have impacted the industry. The company had been a longstanding holdout of the U.S.’s largest brokerages—ones not covered in NAR’s settlement—to settle in the commission cases.
The brokerage has agreed to pay $34 million and “adopt certain practice changes,” according to a filing with the SEC. The money will be paid out in two installments: the first $17 million into the fund within a month of the settlement receiving final court approval, and the other $17 million a year after that.
According to the SEC filing, the settlement is intended to resolve other copycat cases, such as Gibson, Grace, Fierro, Latham, Whaley, Wang and Burton. Notably, this settlement was negotiated in a smaller copycat lawsuit that was filed in Georgia, according to the filing, with most other settlements being reached with the same plaintiffs behind the legacy Burnett and Moehrl lawsuits, who filed larger, national cases after the Burnett verdict almost a year ago.
The official notice of the settlement had not been posted on the court’s electronic filing system at press time, and lawyers representing plaintiffs in the case could not immediately be reached for comment.
eXp said in a statement that the settlement “is not an admission of liability, nor does it concede or validate any of the claims asserted against eXp.
“This proposed settlement aligns with our strategic goals of managing risk and limiting uncertainty while allowing us to move forward to focus on continuing to lead the industry in this new landscape and growing eXp,” the statement continued. “The Company does not expect the terms of the proposed settlement to have a material impact on its results of operations, liquidity, or cash flows.”
The settlement amount contributes to a fund that has already surpassed $1 billion due to settlements from Compass ($57.5 million), Douglas Elliman ($17.75 million), Engel & Völkers, HomeServices of America ($250 million), Redfin ($9.25 million) and more.
Like all other agreements, eXp’s settlement will need to go through a formal court approval process. Only three companies—Anywhere, Keller Williams and RE/MAX—have received final approval for their respective agreements.
The settlement also does not necessarily provide immunity for lawsuits filed by recent homebuyers, with eXp named in at least one of those actions, although the judge overseeing Burnett and the larger copycat cases did grant some limited immunity from buyer lawsuits to Anywhere, Keller Williams and RE/MAX when approving their settlements.
