Douglas Elliman the latest firm to settle commissions lawsuits
The brokerage becomes the ninth real estate entity to strike a deal with home sellers, with an initial damages payment of nearly $8 million.
Another major brokerage company has agreed to pay up to $17.75 million to settle the buyer agent commissions lawsuits.
New York-based Douglas Elliman will pay $7.75 million within 30 days of preliminary approval from U.S. District Court Judge Stephen Bough, followed by two additional $5 million contingent payments in the next three years, according to a company news release.
The $5 million payments are based on cash balances of at least $40 million through the end of 2027. If the company's balance dips below $40 million for any month between the end of 2025 and 2027, it won't have to make those payments, according to Douglas Elliman's 8-K filing.
Elliman will also make policy changes consistent with those agreed to by other brokerages and the National Association of Realtors in previous settlements.
"The settlement agreement reflects Douglas Elliman's commitment to mitigating future uncertainties and limiting legal costs, which will benefit our Company, agents and stockholders," said Howard M. Lorber, Douglas Elliman chairman and CEO.
Founded in 1911, the publicly traded company ranked fifth in the 2023 Real Estate Almanac's top 1000 list by 2022 sales volume, with $42.8 billion. At the end of 2022, the almanac estimated the company's agent count was 6,900.
Which cases was Douglas Elliman involved in? The brokerage was named in multiple lawsuits filed after the Sitzer/Burnett verdict:
The Gibson case, filed in Missouri
The Umpa case, also filed in Missouri, and now merged with Gibson
The Boykin and Whaley cases, filed in Nevada, which were consolidated under Whaley in March
The Friedman and March cases, filed in New York, which were both later dismissed
The Batton 2 case, which was filed in Illinois by a homebuyer, not a seller
Settlement tally: With Douglas Elliman settling, the pool of money in the commissions cases is now up to more than $950 million. Here are the brokerages/organizations that have announced settlements as of April 29:
National Association of Realtors: $418 million
HomeServices of America: $250 million
Anywhere Real Estate: $83.5 million
RE/MAX: $55 million
Keller Williams: $70 million
Compass: $57.5 million
Real Brokerage: $9.25 million
Realty ONE, @properties: Damage total not announced yet
Douglas Elliman: Up to $17.75 million