The courtroom volley between The National Association of REALTORS® (NAR) and the U.S. Department of Justice (DOJ) wages on. This time, the DOJ claims that it should be allowed to investigate NAR because its antitrust settlement wasn’t formalized.
“Contrary to NAR’s suggestions, the Division never committed to refrain from further investigation into NAR and its practices,” claimed the DOJ in an Oct. 13 U.S. District Court filing.
The motion argues that the agreement that the Justice Department withdrew from in July wasn’t finalized, allowing the agency to pursue another investigation into NAR’s policies and practices.
“In 2020, the United States and NAR discussed, and the United States eventually filed, a proposed settlement that would have culminated in entry of a consent judgment by the Court, but no consent judgment was ever entered,” said DOJ Senior Counsel James Luh in the court filing.
The recent motion by the Justice Department also seeks to have the courts deny a petition that NAR filed in September to quash DOJ’s attempt to back out of the settlement that the Antitrust Division approved in November 2020.
The petition noted that the Antitrust Division agreed to close civil antitrust investigations concerning two of NAR’s policies for multiple listing services (MLS), called the Participation Rule and the Clear Cooperation Policy.
The DOJ admitted that it sent a letter to NAR confirming that it closed an investigation of NAR’s Participation Rule and Clear Cooperation. However, the court filing asserts that “the three-sentence closing letter contained no commitment to refrain from future investigations of NAR or its practices or from issuing new CIDs in conjunction with such investigations.”
NAR representatives rebuked the Justice Departments’ response, maintaining the association’s stance that the agreement was “fully binding.”
“If DOJ’s view prevails, it would undermine the strong public policy in favor of upholding settlement agreements and public confidence that the government will keep its word,” says NAR spokesperson Mantill William. “We are living up to our commitments under the settlement—we simply expect the DOJ to do the same.”
NAR has maintained its disapproval of the DOJ’s request to back out of the settlement. In previous statements, the association claimed that it was holding up its end of the bargain by implementing agreed-upon changes to repeal or modify certain anticompetitive rules, such as:
– Prohibiting MLSs that are affiliated with NAR from disclosing to prospective buyers the commission that the buyer broker will earn
– Allowing brokers to misrepresent to buyers that a buyer broker’s services are free
– Enabling buyer brokers to filter MLS listings based on the level of commissions offered
Similar changes were featured in a recent series of motions that a NAR committee passed in September to improve transparency and disclosure of compensation offered to buyer agents on association-operated MLSs.
The feud between NAR and DOJ isn’t the first time the two parties have butted heads about the association’s practices. The Justice Department filed a lawsuit against the organization in 2005, alleging that NAR rules limited competition from real estate brokers who use the internet to serve their customers.
Both parties reached an agreement in 2008 in a settlement that required NAR to remove anti-competitive policies while also forcing MLSs to repeal rules based on said policies.
Williams maintains that NAR remains committed to advancing and defending independent, local real estate organizations that provide greater economic opportunity and equity for small businesses and consumers of all backgrounds and financial means.
This is a developing story. Stay tuned to RISMedia for updates.
Jordan Grice is RISMedia’s associate content editor. Email him your real estate news to jgrice@rismedia.com.
