Five additional brokerages named in California’s commission lawsuit

Northern California’s copycat commission lawsuit, known as Grace after its lead plaintiffs, has gained five additional defendants. In an amended complaint filed on Friday, the plaintiffs’ counsel named Vanguard Properties, Twin Oaks Real Estate, Windermere Real Estate Services Company, Rapisdara & Fox and Realty One Group, as additional defendants in the antitrust suit.

Vanguard operates in Marin, Sonoma, Napa, San Francisco, East Bay and Palm Springs counties and has approximately 500 agents. Twin Oaks is headquartered in Solano County and has roughly 100 agents, while Windermere is headquartered in Seattle and has over 6,500 agents. According to the amended complaint, the firm does “substantial business” the Northern District of California. Rapisdara & Fox is an affiliate of defendant Realty One Group, operating under Realty One Group FOX. The firm operates in Northern San Francisco Bay Area, Solano County, Napa County, Sonoma Count, and Yolo County, and it has roughly 100 agents.

The lawsuit was originally filed in U.S. District Court for Northern California in early December.

The five additional brokeragea join Bay Area Real Estate Information Services MLS (BAREIS MLS), National Association of Realtors, RE/MAX, Anywhere, Keller Williams, Compass, eXp World Holdings,  Marin Association of Realtors, North Bay Association of Realtors, Northern Solano County Association of Realtors, and Solano Association of Realtors, as defendants.

Like the other commission lawsuits, the Grace suit takes aim at NAR’s Participation Rule, which requires listing agents to make a blanket offer of compensation to the buyer’s broker in order to list the property on the MLS. Although BAREIS MLS is partially broker-owned and not solely owned by Realtor associations, the complaint alleges that since “virtually all committee members” were NAR members during the proposed class period and NAR members are required to comply with the NAR Handbook and code of ethics, the Participation Rule was in play with properties listed on BAREIS MLS. In addition, BAREIS MLS has its own rule similar to NAR’s Participation Rule.

“The gravamen of Plaintiff’s complaint is that anti-competitive BAREIS MLS rules, which Defendants agreed to, implemented, and enforced, require Class members to make a blanket, unilateral, and effectively non-negotiable offer of buyer broker compensation when listing a property on the BAREIS MLS,” the amended complaint states.

The lawsuit is seeking class action status for the suit, with the proposed class being any homeowner who listed and sold a home on BAREIS MLS between Dec. 8, 2019, and the present. Additionally, the plaintiffs are demanding a jury trial, damages, a permanent injunction barring the defendants from requiring sellers pay the buyer broker, and “restitution and restitutionary disgorgement of all monies wrongfully obtained from Plaintiff and the Class by Defendants.”

In late December, the plaintiffs in the Gibson and Umpa suits ask the court if their suits, along with Grace and six other copycat commission suits can consolidate in Missouri under Judge Stephen Bough, who oversaw the Sitzer/Burnett trial. A ruling has yet to be made on this motion.