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Realtors Appeal to Supreme Court Over DOJ’s Investigation into Antitrust Violations

By  |  October 13, 2024
Real estate, housing, National Association of Realtors, Pending Home Sales Index

The National Association of Realtors (NAR) has filed a petition with the U.S. Supreme Court, requesting it to block the Justice Department from reopening an investigation into the organization’s commission practices. This move follows a previous agreement that ostensibly resolved similar inquiries into the association’s operations.

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    According to Reuters, the Chicago-based real estate group claims that the Justice Department’s recent actions violate the terms of a settlement reached in 2020, which had closed a prior investigation into its broker commission policies. At that time, federal authorities were examining NAR rules requiring home sellers to offer a commission to buyers’ agents, a provision seen as potentially anticompetitive.

    The Justice Department withdrew from this settlement in 2021, arguing that the agreement would impede its capacity to pursue future antitrust claims against the NAR. The association’s petition contests a ruling from the U.S. Court of Appeals for the D.C. Circuit, which allowed the DOJ to revisit the investigation. While the Supreme Court could choose not to hear the case, NAR’s legal team argues that the government must uphold its commitments regardless of political changes.

    “Every day, federal agencies resolve civil and criminal enforcement actions through agreements with private parties,” the association’s attorneys at Quinn Emanuel Urquhart & Sullivan stated in the Supreme Court filing. The NAR’s spokesperson emphasized that this appeal represents a critical effort to hold the Department of Justice accountable to the terms of its previous agreement.

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    Related: NAR Appeals Circuit Court Decision, Takes DOJ Fight to Supreme Court

    The investigation’s focus has returned to rules that required home sellers to offer commissions to buyers’ agents for their listings to appear on multiple listing services (MLS). The DOJ contends that this rule may have violated U.S. antitrust laws by directing buyers’ agents towards properties that promised higher commissions.

    Earlier this year, the NAR agreed to pay $418 million to settle a nationwide class-action lawsuit from private plaintiffs over similar claims, further indicating a willingness to revise its commission practices. This settlement, which seeks final approval in a Missouri federal court, does not admit any wrongdoing on the part of the association.

    In the wake of the proposed changes, NAR no longer mandates commission offers from agents for listings to appear on MLS, though commission arrangements remain negotiable.

    A trial judge in Washington, D.C., previously blocked the DOJ from reopening its investigation, but the appeals court ruled in favor of the department in a 2-1 decision. The majority opinion stated that the Justice Department had made no binding commitment to refrain from launching a new investigation or reopening the closed inquiry.

    The case, known as National Association of Realtors v. United States, remains unassigned within the Supreme Court as the NAR seeks clarity on the legal implications of their previous settlement and the authority of the DOJ in this matter.

    Source: Reuters