Baird & Warner, the second-largest real estate brokerage in Chicago, is facing a state-level class-action lawsuit, receiving allegations that they colluded with the residential real estate industry to keep agent commissions costly.
Filed in Cook County Circuit Court on February 22, the plaintiffs Mary Maslanka and David Frefield alleged anti-competitive practices that restrained price competition, and lawyers Evan Meyers, Paul T. Geske and Brendan Duffner are calling for a class action on behalf of both buyers and sellers. The lawyers also claim that a large number of consumers have paid inflated commissions as a result of such practices.
“NAR, Defendant and their co-conspirators have created and implemented anti-competitive rules and policies related to broker commissions that have harmed consumers by, among other things, causing them to incur substantial additional costs in the form of inflated broker commissions and increased home prices,” lawyers wrote in court filings.
These same lawyers—working out of Chicago firm McGuire Law—also filed a suit of similar basis against @properties Christie’s International Real Estate back in December, with different plaintiffs, however.
The lawsuit is notable due to being filed in state rather than federal court, and also for attempting to certify a class of buyers and sellers together. Other Burnett copycats have mostly been filed in federal court, and claims by sellers and buyers have so far been litigated separately.
The massive $418 million settlement by NAR announced Friday that will cover dozens of lawsuits brought by homesellers nationwide will not apply to any cases brought by homebuyers, meaning at least some of the plaintiffs in this case will continue to pursue their claims.
Baird & Warner stated the company has historically been transparent with clients.
“As has been the case with other major brokerages and the National Association of REALTORS®, Baird & Warner has been named in an antitrust case regarding buyer agent compensation,” Baird & Warner told RISMedia in a statement. “While our ability to comment on the specifics of this case is limited, Baird & Warner takes our responsibility to buyers and sellers extremely seriously, and we are confident in our ability to defend our position and protect our reputation within the established operating framework of our industry. We have long had some of the most explicit language in our contracts and training materials, including our exclusive Certified Buyer Specialist course, to ensure our agents are transparent with their clients and can provide them with all the necessary information to make an informed decision.”
According to court documents, Maslanka sold a Chicago home in 2012 and Freifield bought and sold local properties in 2019, both using Baird & Warner to handle transactions—who they claim has violated state laws such as the Illinois Antitrust Act and the Illinois Consumer Fraud and Deceptive Business Practices Act.
NAR is listed in this case, although as a co-conspirator, and Baird & Warner is the sole defendant. Plaintiffs noted that they are bringing the case in representation of themselves, but also individuals alike who are facing similar situations due to the Illinois-based powerhouse firm allegedly “engaging in and facilitating a conspiracy that perpetuates anti-competitive measures in the real estate broker market in Illinois. Defendant and its co-conspirators have adopted and implemented practices that keep real estate broker commissions artificially elevated, resulting in harm to both homebuyers and homesellers who are saddled with additional costs when buying or selling a home.”
A post-Burnett industry has bore witness to numerous copycat suits—federal and statewide—with identical claims of price collusion from national brokerages that fall under NAR and follow their code of ethics.
The plaintiffs have requested a jury trial so that all claims can be tried.
