NAR Supports Centralization of Compensation Lawsuits

NAR’s view is that all relevant cases should be included in any consolidation (including buyer and seller cases), and the Northern District of Illinois is best placed to address the industrywide issues these cases present.

Last month, plaintiffs in some of the ongoing antitrust lawsuits concerning broker commissions filed a motion with the Judicial Panel on Multidistrict Litigation, asking the panel to centralize and transfer various cases to the federal court in the Western District of Missouri, where the Sitzer/Burnett case was tried.

The National Association of Realtors, which filed its response to that motion on Jan. 23, supports centralizing 19 currently pending commission lawsuits but disagrees with plaintiffs’ arguments that it would be most efficient to transfer the cases to the Western District of Missouri. Instead, NAR believes the best venue to hear the pending lawsuits is the federal court in the Northern District of Illinois.

Centralizing cases with overlapping factual issues into a single multidistrict litigation can create a more efficient legal process that avoids inconsistent rulings and conserves the courts’ and parties’ resources. NAR’s view is that all relevant cases should be included in any consolidation (including buyer and seller cases), and the Northern District of Illinois is best placed to address the industrywide issues these cases present. NAR believes that the Northern District of Illinois is the most appropriate place for these cases to be transferred for several reasons, including:

It is the district in which the original commission cases were filed and remain pending.
It is the only district with both buyer and seller cases pending.
It is the district with the largest number of cases pending.
NAR headquarters—and, therefore, much of the discovery related to these cases—is in the district.
The district has experience with NAR rules.
Chicago is a central location that is easily accessible for all parties.

NAR also says it would not oppose the cases being transferred to the Eastern District of Texas, where the cases with the largest number of defendants are pending.

NAR’s proposal is different from what the moving plaintiffs’ attorneys have requested. Plaintiffs have asked that some—but not all—cases be consolidated in the Western District of Missouri. NAR opposes the moving plaintiffs’ proposal because, among other reasons stated in the filing, it would result in multiple parallel proceedings and defeat the purposes of consolidation.

The JPML will issue its decision after it hears arguments on these cases, which is expected to occur in late March.

NAR recognizes that the outcome of the pending cases could have a significant impact on the real estate industry, which employs around 1.5 million people and represents approximately 17% of the country’s GDP. NAR remains committed to supporting any association that is named in a copycat lawsuit. Watch for updates on ongoing litigation at competition.realtor.