Class certification in homebuyer commissions case hits a wall 

Attorneys for the homebuyer plaintiffs in a years-long commissions lawsuit got a stern talking-to Tuesday morning for proposing a class that includes seller claims barred by earlier settlements.

"I'm not sure why I got a class certification motion with a class that I can't really certify," Judge LaShonda A. Hunt of the U.S. District Court for the Northern District of Illinois Eastern Division said at the Nov. 4 hearing.

Asking to represent millions, but there's a catch

Similar to the landmark Sitzer/Burnett case — but filed by buyers, not sellers — the suit, known as Batton 1, alleges that NAR, Anywhere, Keller Williams and RE/MAX engaged in a "decades-long, nationwide antitrust conspiracy" to inflate buyer-broker commissions, resulting in buyers paying "billions in overcharges." 

In late September, the plaintiffs filed a motion for class certification to represent the estimated millions of buyers who could be eligible for relief. 

But Judge Stephen R. Bough, who oversaw the Sitzer/Burnett and Gibson cases, previously ruled that buyers who also sold homes and were part of those settlement classes would not be eligible to participate in buyer lawsuits making similar antitrust claims. Those settlements are currently on appeal in the Eighth Circuit.

Class certification 'can't go forward'

At Tuesday's hearing, Hunt said that until the Eighth Circuit ruled on the appeal, Bough's ruling would have to be honored. But she didn't stop there: Hunt berated the plaintiffs for not raising the issue sooner and not asking for a stay until that ruling.

"Now we have thousands and thousands of pages of documents that have been filed on the docket, all the time and money that has been spent on this motion, and it can't go forward because you haven't limited the class definition to exclude those released claims," Hunt said.

The plaintiffs' attorney countered that it would be easier for the judge to narrow the proposed class later, if needed, rather than add to it should the Sitzer/Burnett ruling be overturned.

Anywhere says it 'paid for' release from buyer claims

But Stacey Mahoney, outside counsel for Anywhere, argued that Anywhere was complying with the Sitzer/Burnett settlement and shouldn't be forced to litigate released claims. "We have paid for that release. We are entitled to that relief," she said.

Hunt said that was "a fair point," noting that such relief "is what was bargained for in the Burnett settlement."

Before the hearing, Anywhere had asked Hunt to reject the plaintiffs' motion for class certification, arguing that up to 79% of the members of the proposed buyer class were also sellers during the period of time covered by Batton I and therefore did not qualify.

NAR says plaintiffs have 'made their bed'

At the hearing, NAR outside counsel Suyash Agrawal told Hunt the trade group "largely agreed" with Anywhere but that the court should "go further" and perhaps allow the plaintiffs to redefine the class — but not allow them to submit any new discovery.

"They made their bed. They should lie with it," Agrawal said.

"Have them be limited to the arguments, the expert analysis and the work that they have done," he added. "If that is fatal to their position, so be it."  

What's next

At the end of the hearing, Hunt raised two possibilities for the plaintiffs: She would consider either an amended motion for class certification that would narrow the class to remove buyers who were also sellers, or she would consider staying the case until the Eighth Circuit rules on the Sitzer/Burnett appeal. 

She asked the parties to meet and present a joint proposal, if they could come to an agreement, at a follow-up hearing on Nov. 14.