The COURT REPORT is RISMedia’s weekly look at current and upcoming lawsuits, investigations and other legal developments around real estate.
eXp and Weichert settlements under review
eXp and Weichert’s attempts to reach a conclusion in the commission lawsuit Gibson v. NAR have hit another road block. Both brokerages have faced accusations of partaking in a “reverse auction” (where a defendant seeks out plaintiffs willing to negotiate the lowest price for a class-action settlement).
Judge Stephen Bough, after conducting an “in camera review” (a private review of evidence) to determine whether their settlement negotiations constitute a reverse auction, found what he described as “revealing” communications that make the reverse auction accusation “plausible.”
“It seems clear that eXp was negotiating with two groups of plaintiff’s counsel simultaneously for the same nationwide class action,” Bough wrote.
Bough also noted that Weichert offered $13 million to plaintiffs in Gibson, before quickly pivoting to negotiate with plaintiffs in a smaller Burnett copycat case (known as Hooper), where they eventually settled for $8.5 million. Likewise, eXp’s mediator indicated he was looking for a settlement amount in the “$40 (millions),” although eXp eventually settled for $34 million with the Hooper plaintiffs.
The mediator, in fact, accidentally congratulated the Gibson plaintiffs on the successful settlement, according to Bough, who had previously balked at the idea that eXp had been surreptitiously negotiating in two cases at once (something the company previously denied).
It is unclear what will happen with the two companies’ settlements, but Bough last Friday ordered both brokerages to turn over documents to the plaintiffs in Gibson, and begin conferring on discovering possible depositions over the “reverse auction” accusation.
MLS PIN says DOJ rejected NAR settlement overtures
In the first class-action commission settlement—which preceded the Burnett trial by months—plaintiffs are urging the judge to approve their deal despite objections from the Department of Justice (DOJ), which previously intervened in the case.
Noting that the settlement deal has not been pending for 18 months, plaintiffs urged Judge Patti Saris in a filing last week to approve the deal, claiming that DOJ lawyers have not been willing to say what changes they want to the deal—which is separate from NAR’s settlement, as MLS PIN is not affiliated with NAR.
In fact, the plaintiffs claim they floated the idea of having their settlement modified to “mirror” the NAR deal, but were rebuffed—while also being careful to say their deal was “at least as good, if not better, for consumers than the NAR Settlement.”
“However, Plaintiffs were willing to discuss the issue with the Department in good faith, and thought at a minimum that establishing a baseline might facilitate further discussions,” they wrote.
Saris had not ruled on the settlement at press time.
NAR moves for dismissal in Michigan broker lawsuit
The National Association of REALTORS® (NAR), along with the Michigan Association of REALTORS® and other local associations, has filed for the dismissal of an antitrust lawsuit against them. Unlike most other ongoing litigation, the plaintiffs are not homebuyers or sellers, but real estate professionals.
Filed in the Eastern District Court of Michigan back in August 2024, the case was brought by two Michigan brokers and one agent, affiliated with Sotheby’s. The suit alleges a monopoly on the grounds that one must be a REALTOR® association member to access an MLS, and in turn, the NAR settlement and rule changes have made MLS access (and thus REALTOR® membership) less valuable.
NAR and the defendants argue that the plaintiffs failed to “plausibly allege” that the REALTOR® membership requirement harmed them or suppressed competition, calling the assertion that the MLS is the only available source of certain information “implausible on the face.” They further claim that the complaint does not hold water on antitrust grounds, because the plaintiffs have not demonstrated harm to competitors and have not properly defined “relevant markets” in the complaint.
This and other more recent cases highlight ongoing tensions within the real estate industry as traditional MLS and commission practices face increased scrutiny, with similar lawsuits cropping up in half a dozen other states.
Long-running Clear Cooperation lawsuit ends
As NAR considers the future of its Clear Cooperation Policy (where REALTORS® must list a property on an MLS within one business day of marketing it), a lawsuit concerning the policy has been dropped.
Filed back in 2020, the California-based MLS known as Top Agent Network (TAN) claimed that Clear Cooperation violates antitrust laws and works to stifle competition from alternatives to NAR-affiliated MLSs. Previously set for trial in November 2025, the case was dismissed without prejudice (meaning TAN could refile the complaint in the future). Indeed, a NAR spokesperson and TAN attorney Tobias Snyder both characterized the dismissal as a mutually-agreed-to pause rather than an ending.
“NAR and TAN announce that they have reached an agreement under which TAN will dismiss its pending antitrust case against NAR without prejudice. This pause will allow NAR to continue to deliberate the future of the Clear Cooperation Policy, including any possible interpretations or modifications,” the statement said.
NAR President Nykia Wright recently told RISMedia Founder and CEO John Featherston that the association expects the Clear Cooperation issue to be “settled” soon.
FTC sues corporate landlord Greystar
On Thurs., Jan. 16, 2025, the Federal Trade Commission (FTC) filed a lawsuit against large landlord Greystar Real Estate Partners. The FTC alleges that Greystar has charged its tenants hidden fees, such as mandatory service fees or lease termination charges, numbering in the millions total.
Colorado Attorney General Phil Weiser, who helped file the lawsuit, stated that, “Through their actions, Greystar is thwarting apartment hunters from comparison shopping and choosing a home that fits within their budget.”
Greystar disputed the lawsuit’s characterization of its practices, saying in a statement that “the FTC’s complaint targets a longstanding industrywide practice of advertising base rent to potential residents…(t)he most effective path to achieving uniform and consistent fee disclosures is through clear regulatory guidelines for our industry.”
This news comes off of the DOJ suing Greystar and five other large landlords for alleged price-fixing on rental apartments.
Agent sues closed brokerage owner for failure to pay commission
Massachusetts-based Success Real Estate abruptly shuttered its doors in December 2024 after 32 years of operation. Now, former Success owner Stephen Webster is facing lawsuits from more than a dozen people who claim he owes them money. The lawsuit claims that Webster borrowed money from both personal friends and business colleagues, including agents working under him, with the pretense that he would be able to pay it back.
One of the plaintiffs, Stacey Ballerino, has claimed that Webster owes her and husband not only a $140,000 personal loan, but also a $17,000 commission she earned while working as an agent at Success Real Estate.
