Gibson settlements will stand, appeals court rules 

Nearly two weeks after upholding the settlements reached in the landmark Sitzer/Burnett case, the U.S. Court of Appeals for the Eighth Circuit has also allowed the settlements in a similar commissions lawsuit known as Gibson to stand.

The same three-judge panel considered appellants' arguments for both cases at a hearing in January. The panel's Sept. 1 ruling means the distribution of settlement funds can move forward, with the Sitzer/Burnett and Gibson deals accounting for most of the $1 billion-plus total.

What this case was about: The Gibson case was filed in the U.S. District Court in Western Missouri in late October 2023, right on the heels of the jury's decision in the industry-defining Sitzer/Burnett case. As with Sitzer/Burnett, the Gibson plaintiffs filed a class-action complaint on behalf of homesellers alleging that an industry conspiracy was at play to keep agent commission fees inflated.

The initial complaint named eight defendants: the National Association of Realtors, Compass, Douglas Elliman, eXp Realty, Howard Hanna Real Estate, Redfin, United Real Estate and Weichert Realtors. Most of the Gibson defendants have already reached agreements to settle in the case, though some holdouts remain.

It was the first so-called "copycat lawsuit" following the Sitzer/Burnett verdict, and it has been closely aligned with the earlier case over the past three years.

How we got here: Several appellants challenged the settlements in both Sitzer/Burnett and Gibson last year. Some argued that the damages awarded were not significant enough and that attorney fees, which accounted for about one-third of the total settlement fund, were too high. Others sought to exclude homesellers who also bought a home from the settlement class.  

But many within the industry warned that voiding the settlements would result in a new wave of widespread uncertainty among real estate professionals and legal action among consumers following years of efforts to resolve concerns over commissions through lawsuits and policy changes.

The judges heard final arguments from the appellants in January.

What the judges had to say: While the panel's Aug. 19 explanation of its decision in the Sitzer/Burnett appeal was nearly 30 pages long, the Gibson ruling from judges Lavenski Smith, Ralph Ericskon and Jonathan Kobes contained only two sentences.

"These appeals from the United States District Court were submitted on the record of the district court, briefs of the parties and were argued by counsel. After consideration, it is hereby ordered and adjudged that the judgment of the district court in this cause is affirmed in accordance with the opinion of this Court," their ruling said.

Real Estate News has reached out to NAR for comment.