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3 things to know about the commissions class action lawsuit 

As the Moehrl vs. NAR, et al., lawsuit moves forward, these key details can help real estate pros understand the basics.

May 31, 2023
3 minutes

Key points:

  • In a telephone briefing this week, the judge in Moehrl vs. NAR laid out a timeline of what's next.
  • The impacts of a verdict favoring the plaintiffs could include changes to agent compensation and MLS business practices — plus huge financial damages.

A class action lawsuit that could upend the way agents are paid commission continues to move forward, with a trial date expected sometime in 2024. 

In a May 30 telephone conference, U.S. District Court Judge Andrea Wood laid out a timeline of what's next in the Moehrl vs. the National Association of Realtors, et al., case. Court documents from the Northern District of Illinois show deadlines for expert discovery are set for September, and a deadline for other motions in late October. It's expected that a trial date will be announced around this time.

Here are three things real estate professionals should know.

What is the Moehrl case?

Named after home seller Christopher Moehrl, the class-action lawsuit involves home sellers who are suing the National Association of Realtors and several major real estate brokerage companies, including Anywhere, HomeServices of America, RE/MAX and Keller Williams. 

The lawsuit claims NAR and others participated in anticompetitive practices by forcing sellers into a system where they pay a commission that is split between buyer and seller agents. The plaintiffs believe this system has led to inflated buyer agent fees to the detriment of home sellers, and they argue that homebuyers should pay for their own agents.

NAR and the other defendants counter that the current system "provides transparency and market-driven pricing options for home buyers and sellers," according to NAR spokesman Wes Shaw.

In addition to NAR and the named brokerage companies, 20 Multiple Listing Services are identified as "co-conspirators."

What is the impact if the plaintiffs win?

If the plaintiffs prevail, agent compensation will fundamentally change, MLSs may have to alter the way they do business, and the defendants could have to pay out a massive amount in damages. 

As a class action lawsuit, thousands of home sellers who paid a commission to the specified companies from 2015-2020 as well as "current and future" sellers engaged with those entities could be compensated if the plaintiffs win — not just the handful who initially filed suit in 2019.

Total damages could exceed $13 billion, a mind-boggling sum. As real estate industry expert Russ Cofano pointed out in a recent column, the market cap of Anywhere is around $650 million, or less than 5% of the claimed damages.

Because of the size of the case and the likelihood of appeals, it may take years before a final outcome is reached.

Isn't there another commissions lawsuit?

Yes. Burnett v. The National Association of Realtors (formerly Sitzer vs. NAR) makes similar claims and was granted class action status in April 2022. That case, however, is limited to home sellers in Missouri. NAR and the same major real estate companies are listed as defendants, along with several Missouri-based MLSs.

The trial date for the Sitzer/Burnett class action case has been set for Oct. 16.

Correction: An earlier version of this article mischaracterized the role of MLSs. They are alleged "co-conspirators," not defendants.

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