“Commission lawsuit” has easily become the most searched term on CaliforniaListings.com over the past few weeks—and now there’s a new suit to add to the file. This time, however, buyers are getting in on the legal action.
Known as Batton 2, after the lead plaintiff Mya Batton, the Illinois lawsuit accuses Compass, eXp World Holdings, Redfin, Douglas Elliman, Weichert Realtors, United Real Estate and Howard Hanna of conspiring to artificially inflate agent commissions, resulting in elevated home-buying costs. But unlike the Sitzer-Burnett, Moehrl and Gibson lawsuits, the National Association of Realtors is not named as a defendant in Illinois.
The suit does, however, take issue with NAR’s Clear Cooperation rule, which requires listing brokers to make an offer of compensation to buyer brokers in order to submit a listing to a the MLS.
“NAR’s requirement that offers of compensation be expressed in specific dollar or percentage terms enables buyer agents to easily compare the financial compensation offered to them by home sellers and steer their clients to higher commission homes,” the filing reads. “Thus, the Rule is designed to create tremendous pressure on sellers to offer the high, standard commission and to act as a powerful deterrent to anyone who may attempt to offer a discounted commission.” The plaintiffs claim that they have “incurred at least thousands of dollars in overcharges as a result of Defendants’ conspiracy.”
According to Housing Wire, the suit is seeking class-action status, a jury trial, a damages award and a permanent injunction preventing the defendants “from establishing the same or similar rules, policies, or practices as those challenged in this action in the future.”
Batton 2 has two proposed classes: The first is a nationwide class, which consists of “all persons who, since Dec. 1, 1996 through the present, purchased in the United States residential real estate that was listed on an NAR MLS.” The second is a damages class, which consists of “all persons who, since Dec. 1, 1996 through the present, purchased in the Indirect Purchaser States residential real estate that was listed on an NAR MLS.”
The plaintiffs currently have another lawsuit pending in the same district against NAR, Anywhere, Keller Williams, RE/MAX, HomeServices of America, and three HomeServices subsidiaries, alleging that the rules imposed by NAR—including the Cooperative Compensation Rule—have resulted in buyers paying higher home prices.