It appears that no real estate brokerage firm in the United States is immune to commission lawsuits. On Wednesday, Manhattan home seller Monty March filed a lawsuit in the U.S. District Court for the Southern District of New York, alleging: New York State Real Estate Board Rules governing Manhattan’s multiple listing service kept fees high and violated state and federal antitrust laws.
In addition to REBNY, the strong list of defendants includes: New York Listing Service Real Estate Board, Brown Harris Stevens, Christie’s International Real Estate, Coldwell Banker, Compass, core marketing services, Corcoran Group, Douglas Elliman, Elegran, Engel & Völkers, Fox Residential Group, halstead real estate, home snap, Keller Williams New York City, Leslie J. Garfield & Company, MNS Real Estate, Level Group, modern space, agency, Modlin loop, Nest Seekers International, oxford property group, R New York, RE/MAX, Serhant., sloane squareand Sotheby’s International Realty Affiliates. Conspicuously missing from the list are the National Association of Realtors.
The 105-page complaint targets a REBNY Listing Service rule called the Buyer-Broker Commission Rule. The rule states that brokers “must pay an equal commission to each broker as provided in the exclusive listing.”
Mr. March, who sold a home in Manhattan and is the only named plaintiff, claims that REBNY’s universal co-brokerage agreement forced him to pay allegedly inflated commissions to the buyer’s agent. states that.
“The inclusion of language in the listing agreement regarding commissions paid by the seller broker to the buyer broker, commonly known as the buyer broker fee rule, constitutes an antitrust violation under Section 1 of the Sherman Act and the Donnelly Act. “There is no separate negotiation/competition regarding the fees to be paid,” the application states. “The REBNY Listing Service commission rules foster an environment where brokers work together to split the total commission amount rather than in open and individual negotiations. Compared to other countries with competitive markets for residential real estate brokerage services. , the anti-competitive nature of the fee rules is clear.”
The lawsuit seeks class action status, and the proposed class includes Manhattan home sellers who worked with agents of one of the defendants between November 8, 2019 and the present.
In mid-October, REBNY announced changes to its rules, including a rule prohibiting listing agents from paying or offering to pay fees to buyer agents. Instead, if the seller wants to compensate the buyer’s agent, the seller must pay the agent themselves. The seller is not required to compensate the buyer’s agent. This rule will take effect on January 1, 2024.
“We are reviewing the complaint with our legal counsel. In the meantime, we remain confident that RLS’s practices and procedures comply with all relevant laws,” a REBNY spokesperson said in an email. Stated.
housing wire All 26 intermediary defendants in the lawsuit were contacted. Brown Harris Stevens, Christie’s International Real Estate, Homesnap, SERHANT., Compass, Keller Williams and Douglas Elliman all declined to comment, while the others did not respond to requests for comment.