The U.S. Department of Justice is making clear that its attention on real estate commission practices is far from over, as a recent court filing suggests federal antitrust enforcers remain skeptical of long-standing industry rules.
According to a DOJ statement filed in late December, the department submitted a statement of interest in the Davis homebuyer commission lawsuit, a case brought in May 2024 against Howard Hanna Real Estate Services. The filing urges the court to more closely examine whether traditional agent commission structures violate antitrust law, arguing that certain trade group rules may be inherently anticompetitive.
Per the statement, the DOJ questioned the legality of commission-related policies associated with Realtor organizations and multiple listing services, asserting that such rules could contribute to inflated fees. While the department did not take a position on how the court should ultimately rule in the Davis case, it challenged several arguments raised by Howard Hanna in its motion to dismiss.
According to the filing, the brokerage argued that the alleged conspiracy could not exist because the conduct at issue involved Realtor association rules and discussions that it claimed offered pro-competitive benefits and consumer protections. The DOJ pushed back on that reasoning, stating that policies created by trade associations can still amount to coordinated action among competitors and potentially violate antitrust laws.
In its analysis, the DOJ also addressed the legal framework the court should apply. Per the statement, the department argued against using the “rule of reason,” which weighs competitive benefits against harms, and instead suggested that a “per se” approach may be appropriate if the rules are found to be inherently anticompetitive.
The filing caught some industry observers off guard, particularly those who expected a lighter regulatory touch under the current administration. However, antitrust specialists say the move aligns with longstanding DOJ practices.
“The DOJ often files statements of interest simply to make sure that courts, who may not necessarily be specialists in antitrust law, understand the standards and so that then the court’s decisions don’t become bad law that is later cited by other courts,” said Harrison McAvoy, a partner at Shinder Cantor Lerner, according to comments cited in the source material.
Bradley Weber, co-leader of Troutman Pepper Locke’s antitrust practice, noted some surprise at the timing and tone of the filing but emphasized the broader context of housing affordability. “Under the Biden administration, the DOJ and the Federal Trade Commission (FTC) were very active, filing statements of interest and taking positions in cases both in real estate and outside,” Weber said. “It is a little surprising that even under Gail Slater that the DOJ would take such a hard view on these antitrust issues, but I think the real reason is that housing is something everyone has to pay for so it is a very populist issue.”
According to Weber, concerns about housing costs make real estate practices a natural focus for antitrust enforcement, particularly where commission structures could influence prices paid by buyers and renters.
Marx Sterbcow, managing attorney at Sterbcow Law Group, echoed that view. Per a statement attributed to his analysis, Sterbcow said the DOJ’s involvement was predictable given what he sees as the industry’s failure to implement comprehensive reforms on its own. He advised brokerages to consult closely with legal counsel to assess compliance and evaluate risk in areas that may fall into legal gray zones.
Some legal experts view the DOJ’s filing less as a warning and more as guidance. According to McAvoy’s interpretation, the statement serves to clarify how antitrust law may apply to industry-wide rules. Weber similarly noted that the DOJ wanted to formally establish that, under certain circumstances, industry policies could amount to a per se violation of the Sherman Act if plaintiffs adequately allege the facts.
Sterbcow characterized the implications more bluntly, saying, “They are basically saying the whole defense of NAR told us to do it and relying on NAR for coverage isn’t going to hold water anymore. You are now liable for your own actions and you can no longer say ’NAR or the local MLS told us to do it,’ because the DOJ says that you are in fact responsible too.”
According to legal observers, that perspective could have lasting consequences for how brokerages assess liability and defend commission-related practices as the Davis case and similar lawsuits continue to unfold.
Source: Housing wire
