On May 12, in federal court in Chicago, Zillow sued Compass and the listing service MRED under the Sherman Act, alleging coordinated conduct to restrict access to listing data. Four days earlier, Compass had terminated all its direct listing feeds to Zillow nationwide, cutting Zillow’s direct-feed access to more than a quarter of Chicagoland’s active listings in a single day.
Around the same window, Zillow moved to keep privately marketed listings off its site, and Compass lined up nationwide private-listing partnerships with four of the country’s largest MLS systems. Compass denies the allegations. On May 21, MRED suspended Zillow’s IDX and VOW feeds outright, taking roughly 43,000 active Chicagoland listings dark in a single afternoon; on May 22, Judge John Tharp granted in part Zillow’s emergency motion, ordering the feeds restored and barring Zillow from enforcing its private-listing ban inside MRED’s footprint. Whether that sequence is mere coincidence or coordination is what the court will decide.
I am not writing to litigate that case, but because the lawsuit is a symptom—and the underlying issue is one this industry should recognize on sight. We have been here before.
The Code already contains the test
We do not need a new rule to evaluate private exclusives. We have one.
Article 3 of the Code of Ethics: “REALTORS shall cooperate with other brokers except when cooperation is not in the client’s best interest.” Cooperation is the default. There is exactly one exception, and the exception is defined by the client’s interest—not the brokerage’s.
A private exclusive is, by definition, a limitation on cooperation. Under our own Code, that limitation is defensible only when not cooperating serves the seller. So what does the evidence say deferred cooperation does for the seller?
Zillow’s study of roughly 10 million sales: a median $4,975 less when listings bypassed the MLS, more than $1 billion in aggregate seller losses across 2023–2024. Bright MLS’s study of about 100,000 transactions: no measurable price benefit from private pre-marketing, and a median 17 additional days to contract.
And the studies point one direction. That does not mean every individual private-exclusive sale is harmful—it means the aggregate effect on sellers, measured across hundreds of thousands of transactions by multiple independent researchers, has been negative or neutral on price and negative on time to sell.
Then there is the question of who the practice does serve. The Consumer Policy Center’s April 2026 five-metro study found that in Washington, D.C., Compass’s double-ending rate—both sides of the sale kept inside one brokerage—reached 41%, while most other large brokerages in that market fell between roughly 11% and 18%.
Compass’s own internal documents, surfaced in the Zillow litigation, acknowledge the mechanism: off-market sales double-end 72% more often than on-market ones. A practice that yields no measurable price benefit for the seller but reliably produces a second commission for the brokerage is powerful evidence of who the private exclusive actually serves.
When the practice is originated by the agent rather than the seller, Article 3’s exception gets inverted: non-cooperation becomes the default, and “the client’s best interest” becomes an assertion instead of a demonstration. Standard of Practice 3-10 is more specific still—the duty to cooperate is the obligation to share information and make the property available to other brokers “when it is in the best interests of sellers.”
Compass argues that Clear Cooperation itself violates the Code of Ethics by forcing agents to push clients toward MLS listing against their wishes. That reading takes Article 3’s exception in isolation, and skips Standard of Practice 3-10 entirely. The full text of both, read together, points the other direction. The Code keeps tying the exception to the seller; the practice keeps drifting from it.
We have seen this liability before
Here is why the industry should take note.
In Sitzer/Burnett, the liability did not run through individual agents. It ran through NAR’s rules—the cooperative-compensation structure, an industry rule, was the deciding factor. The finding was that the profession had built a system serving its members at the expense of the clients they represented. It cost $418 million and rewrote how we do business.
Now look at March 2025. NAR kept Clear Cooperation but carved an exception into it: the Multiple Listing Options for Sellers policy, with its delayed-marketing and office-exclusive designations. CRMLS said publicly that the move came “in response to increasing pressure from powerful, national brokerages.” And in March 2026, the Council of Multiple Listing Services—the trade body for the MLSs—criticized “large firms” for spreading “a false narrative” about the consumer benefits of exclusive listings, in language widely understood as aimed at Compass.
But here is the structural problem, independent of motive. When a governing body writes a protective rule and then carves an exception that predictably enables the very harm the rule existed to prevent, it puts its own rule-making back at issue. That is precisely where NAR’s rule-making sat in Sitzer. A permitted practice is not the same as a defensible one, and the body that permits it is not insulated from what the practice produces. Compass itself, in its July 2025 letter to NAR, warned of “the possibility of future class-action lawsuits”—describing the risk of keeping Clear Cooperation. NAR, brokerages, and agents should think just as hard about the risk they take on when relying on a carved-out exception.
The exposure does not stop at the association. A brokerage that builds its book on a practice the data calls a cost to sellers stands, as a firm, in the same path the profession stood in before Sitzer. Broker/owners, not just NAR, should be reading the research closely. And the pressure on Compass specifically is now multi-front: the Chicago case is one track; in the Pacific Northwest, the Northwest MLS—sued by Compass and now counter-suing—filed on May 17 asking the court to sanction Compass for “bad faith litigation tactics” in withholding discovery, and to award NWMLS its legal fees. Two federal courts on opposite coasts are now actively supervising Compass’s conduct around private listings.
A checked box is not informed consent
The MLOS policy’s answer to all of this is disclosure. The office-exclusive certification requires the seller to acknowledge that they are “waiving MLS benefits.”
But read what that disclosure requires—and what it does not. It requires the seller to acknowledge waiving “benefits” in the abstract. It does not require the agent to tell the seller the documented cost: that the strategy is statistically associated with a lower net price, a longer time to sell, and an increased chance the agent earns both sides of the commission.
That gap is the entire issue. In medicine, informed consent means a bad outcome is not malpractice—the patient accepted a known risk for a real reason. But it does not rescue a recommendation that carries predictable harm with no countervailing benefit for the typical client. A seller with a genuine privacy reason can consent meaningfully to a private exclusive: they are buying privacy with price, and they know it. The average seller, told the truth—that this will likely net less, take longer and pay the agent more—does not. A signature on a form that omits the cost is not informed consent. It is a checked box.
That assessment is not confined to the industry’s critics. Gary Keller, executive chairman of Keller Williams, addressing more than 10,000 agents at the company’s annual Family Reunion in February, said he had reviewed the private-listing disclosure documents now circulating in the industry and found them “lacking and dangerous”—“thinly disguised marketing pitches,” rather than the honest “side-by-side comparison” a seller actually needs. He tied that warning directly to litigation risk, citing the buyer-commission settlements. When the head of the country’s largest franchise brand tells his own agents the forms fall short, the disclosure-quality problem is no longer a matter of perspective.
And that is the problem with the framing. The private exclusive is presented as the “seller’s choice”—a freedom the rest of the industry is supposedly trying to take away. But it is only a choice when it is informed. It is not a choice when the seller’s trusted advisor—in some states, their fiduciary—directs them to it without quantifying the cost.
The data bears that out. In The Real Brokerage’s March 2026 survey of more than 400 agents, 69% reported that none of their clients had asked to market a home privately, and 54% would not recommend a private-listing strategy for any of their listings. A practice sellers are not requesting, and that a majority of agents would not recommend, is hard to characterize as a “seller’s choice.” Where it occurs, it is overwhelmingly originated on the professional’s side of the table—precisely the circumstance in which Article 3’s exception cannot carry it: the limitation on cooperation is not flowing from the client’s interest.
There is even a legitimate version of the seller-choice argument its loudest proponents do not make. A seller might reasonably not want their home on Zillow, which routes the “request a tour” inquiries a listing generates to agents who pay for them rather than to the listing agent the seller hired—the contrast Homes.com built its “your listing, your lead” pitch around. But that is an argument about which portal, not whether to cooperate at all. A seller can decline Zillow and still be fully in the MLS, syndicated, and exposed to every cooperating broker. Conflating a narrow choice about a portal with the broad, costly choice to leave the cooperative market is the move—and the seller pays for it.
State legislatures have reached the same conclusion. Washington’s private-marketing law takes effect June 11; Connecticut’s informed-consent statute for off-MLS listings passed both chambers unanimously this month; and New York’s Fair and Transparent Real Estate Listings Act—introduced in the Assembly in March (A10679) and now with a Senate companion (S10274, introduced May 11)—would require a listing to be publicly marketed within one day unless the seller signs a disclosure opting out, revocable at any time. All three rest on the same premise: a seller cannot meaningfully waive what was never explained.
The professional obligation
State law dictates the broker’s obligation to a seller. In some states the broker is an absolute fiduciary; others have modified that duty by statute—Georgia’s BRRETA is among the strongest examples. But for this argument, the level of duty does not matter. Every Realtor is bound by Article 1: the obligation to “protect and promote the interests of their client,” and that obligation is “primary.” It outranks our own economics. We do not need fiduciary law. We have the Code—and we all swore an oath to abide by it.
So the obligation is not complicated: read the rule we already have—Article 3, Article 1, Standard of Practice 3-10—honestly, against the data we already have. A marketing strategy that demonstrably reduces seller proceeds while doubling the agent’s commission opportunity is inconsistent with the seller netting the highest price.
And brokerages need not wait for NAR to settle this. A firm can adopt its own disclosure standard now—one that tells the seller the cost in dollars, days, and double-ending odds—and stand on the right side of both the Code and the data.
Exposure creates competition, and competition drives price. A practice that limits exposure works against the person who trusted us with the largest asset they own. The line the profession should hold does not require a new rule: a private exclusive cannot be a default and cannot be agent-originated—it is defensible only as a genuine, seller-originated choice, made with the cost fully disclosed. The Code has known for seventy years that cooperation serves the client. The only question left is whether we will hold ourselves to it.
