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Appeals Court Weighs Reopening DOJ Probe into NAR

 |  December 5, 2023

A three-judge appellate court panel in Washington, D.C. heard compelling arguments on Friday regarding the Department of Justice’s (DOJ) pursuit to reopen its investigation into the National Association of Realtors (NAR). The focus of the inquiry revolves around NAR’s Clear Cooperation Policy and Participation Rule, key elements in the current surge of commission-related lawsuits.

Reports from various news agencies suggest that the panel of judges is leaning towards granting the DOJ the opportunity to resume its probe, signaling an intensification of the longstanding legal clash between the real estate giant and the federal agency.

The backdrop to this legal saga includes a 2020 settlement between the DOJ’s Antitrust Division and NAR, addressing concerns related to listing policies and agent compensation. The settlement required increased transparency on broker commissions and an end to the misrepresentation of buyer broker services as free.

Read more: DOJ Wants National Association Of Realtors Probe Revived

However, a significant twist occurred in July 2021 when, under the Biden administration’s new leadership, the DOJ withdrew the settlement. The decision cited concerns that the agreement’s terms hindered regulators from investigating association rules deemed detrimental to buyers and sellers.

Responding to this, NAR filed a petition in September 2021, seeking to set aside or modify the revived DOJ probes into the trade group. In a notable ruling in late January 2023, Judge Timothy J. Kelly sided with NAR, asserting that the initial settlement’s terms remained in force. Judge Kelly argued that continuing the investigation would undermine the negotiated benefits NAR had secured in the original settlement.

This decision prompted the DOJ to appeal the ruling in March, leading to the culmination of arguments on Friday. Justice Department lawyer Fred Liu, during the appeals hearing, highlighted a critical question: whether the DOJ’s Antitrust Division committed to refraining from reopening the investigation in addition to agreeing to its closure. Liu emphasized that such a commitment was repeatedly rejected by the division throughout the negotiation process.

Source: Finance Yahoo