So far in the first week of the Sitzer/Barnett antitrust Buyers and Brokers Committee bombshell class action lawsuit, four of the five named plaintiffs have testified before the jury.
During testimony, the defendant’s attorney (now included) said: National Association of Realtors, keller williams and Home American ServicesIf desired, there was an opportunity to cross-examine witnesses in addition to questioning by lead plaintiffs’ attorney Michael Ketchmark.
The plaintiff who will appear before the jury is Holly Ellis, a former high school English teacher, who took the stand Wednesday, according to reports. inman news. Ellis is a Missouri homeowner and the daughter of a 30-year veteran in the real estate industry. Ms. Ellis has sold four homes during her lifetime and she has purchased five homes, one of which was sold during the period covered by the lawsuit. Regarding the home sales in question, she said Ms. Ellis paid a 6% commission on her home sales.
According to Ketchmark, the buyer’s agent portion of Ellis’ home sale commissions accounted for 20.55% of her net worth, and fees to both agents used up about 40% of the equity she had accumulated in real estate. It turns out.
“It was a hard pill to swallow, so I ended up taking just a little bit and going home,” Ellis said.
Ellis needed to sell his home because he was moving to South Carolina for a new job. During cross-examination, Ketchmark asked Ellis if he considered himself a “cash-strapped buyer,” but NAR said the rules of participation are at the center of the case, and that he asked Ellis to represent him. They claim that it helps by reducing the burden of paying.
Ms Ellis said she considered herself a “cash-strapped buyer” and said the 20% equity paid to the buyer’s agent in the sale of her previous home would improve her situation as a buyer. He pointed out that it would have been helpful.
“The buyers who chose them, the people who work for them, should be paying them,” Ellis said.
She said she did not know that customers could negotiate fees before joining the lawsuit, and claimed that had she known, “I would have gone in a different direction.”
Defense attorneys established on cross-examination that Ellis knowingly signed an agreement to pay certain fees, knowing that the fees would be distributed among the buyer’s agents.
Ellis said the 6% fee was already written into the contract before it was signed.
Rhonda Barnett took the stand as the second plaintiff. She is a former school psychologist and public school advocate. Ms. Barnett worked with a listing agent from a subsidiary of HomeServices of America for the sale of the home related to the lawsuit. Barnett said her listing agreement required her to circle the commission rate she wanted to pay, offering options of 7%, 8%, 9%, 10% or “blank.” Stated. Mr Barnett said 6 per cent of the blanks had already been filled and his agent told him there was “nothing to negotiate”.
Barnett’s home was originally listed for $275,000 but ultimately sold for $250,000, with the agent receiving a total commission of $15,298.
“I paid the buyer’s broker to negotiate against me and my husband, which resulted in a lower selling price,” Barnett said. “She did a good job for him.” [the buyer]But I had to pay her a fee. ”
Under cross-examination by Robert McGill, an attorney for Home Services of America, Barnett said he considered selling the home as a for sale by owner, but ultimately decided against it because of its access to the MLS. He said he had decided to. She considered using a so-called discount broker, who only charges her a 1% listing commission, but told the buyer’s agent that she would still have to pay a 3% commission.
“I had no problem paying an agent to sell my house,” Barnett said. However, she was “not happy” that she had to pay a fee to a buyer agent.
The third plaintiff to testify was Jeremy Keel, who works in elder law. The sale of Mr. Keel’s home was a $205,000 transaction, and he paid a 6% commission split between the Keller Williams listing agent and the buyer’s agent.
Keel was cross-examined by Keller Williams by Barak Echols. During his investigation, Mr. Echols pointed out that Mr. Keel himself paid no commission when he was the buyer, and that on one particular transaction Mr. Keel only paid a 5% commission. Mr. Keel denied negotiating this fee, saying he did not know he could negotiate the fee because this figure was already written into every contract he signed.
Home sale plaintiff Jerrod Bright, a former police officer and current regional executive director of the Campaign Against Drunk Driving, took the stand Thursday. Bright said he joined the lawsuit after selling his first home.
“After my first experience selling a home, I first learned how it worked, and I didn’t think it was necessarily fair,” Bright said. “I still don’t think it’s fair to pay someone you’re not going to meet and who won’t do you any good. I don’t think that’s fair.”
Bright said he was satisfied with his sales experience. RE/MAX The agent provided that he originally signed an agreement in which he would pay 5.5% in commission and the buyer’s agent would earn 2.7%. However, when he reviewed the sale settlement statement with his attorney, he discovered that he had been charged a 6% fee.
“It was pre-written into the contract and I thought I was signing something that I needed to sign,” Bright added.
Under cross-examination by Mr McGill, Mr Bright admitted that he knew he was paying buyer’s agent fees after reviewing the various contracts he had signed.
When asked by Mr. Ketchmark whether he thought RE/MAX was part of a conspiracy “to line his own pockets,” Mr. Bright said, “No.”
Craig Shulman, an associate professor of economics at Texas A&M, was also called to the stand Thursday. He said NAR had a strong financial incentive in the alleged conspiracy to keep high real estate commission rates, or $225 million a year in dues for his NAR membership, by the trade group.
In addition to the testimony, there was a dramatic element to Thursday’s proceedings. After court adjourned for the day, one of the two women on the jury approached Judge Stephen Baugh, who was overseeing the trial. The woman, a new mother with her approximately 6-week-old baby at home, was removed from the jury. The jury currently consists of seven men and one woman. Despite the denial, the trial is expected to proceed as scheduled because federal rules require a jury of six to 12 people.
The fifth named plaintiff, Francis Harvey, is scheduled to take the stand Friday or Monday. The defendants will begin arguments next week.
