Real Estate Verdict: $1.8 Billion Damages
In a significant legal development, a Missouri jury has rendered a verdict against the National Association of Realtors (NAR), a real estate industry trade group, and several residential brokerages. The jury found them liable for nearly $1.8 billion in damages, concluding that they had conspired to artificially maintain high commissions for home sales. This lawsuit pertains to home sales between April 2015 and June 2022.
The lead attorney for the plaintiffs, Michael Ketchmark, described it as “a tremendous day of accountability for these companies.” Nevertheless, the case is far from settled.
NAR President Tracy Kasper stated, “This matter is not close to being final. We will appeal the liability finding because we stand by the fact that NAR rules serve the best interests of consumers, support market-driven pricing, and advance business competition.” She also mentioned that the specifics of the appeal would be provided upon filing, and in the meantime, they would seek to reduce the damages awarded by the jury.
The jury also found Warren Buffett’s Berkshire Hathaway-owned HomeServices of America and two subsidiaries, along with Keller Williams Realty, guilty of conspiring. HomeServices expressed disappointment with the ruling and announced its intention to appeal, while Keller Williams did not immediately respond.
According to Ketchmark, companies like HomeServices are desperate to maintain a rigged system. He emphasized that the jury swiftly rejected such arguments.
The appeals process is expected to be protracted, potentially taking up to three years, with the losing party likely attempting to have the case heard by the Supreme Court. However, this verdict does not spell the end of buyer commissions, as the judge will need to determine the scope of the injunction, which could lead to minor adjustments to the current commission-sharing system.
Minutes after this verdict, Ketchmark filed a new class-action lawsuit against real estate companies, including Douglas Elliman, Compass, and Redfin. This fresh lawsuit alleges violations of antitrust laws by conspiring to keep commissions high.
