Remaining Batton defendants look to have suit dismissed

Defendants in the behemoth Batton homebuyer commission lawsuit filed a ream of motions on Monday seeking to have the class-action allegations struck down and dismissed.

The Batton suit consists of two separate lawsuits filed by the same homebuyer plaintiffs, alleging that the National Association of Realtors (NAR) and several of the nation’s largest corporate real estate firms conspired to adopt and enforce anti-competitive rules applicable to the vast majority of real estate brokers, resulting in homebuyers paying supra-competitive rates of commission to the brokers they retained to assist with their home purchases.

The first Batton suit was filed in Illinois in January 2021 by Judah Leeder and later amended in July 2022 with Mya Batton as the lead plaintiff. The defendants in the suit include NAR, Anywhere, Keller Williams, HomeServices of America and RE/MAX.

The second Batton suit was filed in November 2023, just days after the jury verdict in the Sitzer/Burnett suit was announced, and the defendants include Compass, eXp World Holdings, Redfin, Weichert Realtors, United Real Estate, Howard Hanna and Douglas Elliman.

In January 2024, the court ruled that the two lawsuits could consolidate into one. Since then, both Howard Hanna and HomeServices of America have been dismissed from the lawsuit.

Additionally, while NAR, Anywhere, RE/MAX, Keller Williams and Compass have all reached settlement agreements in the commission lawsuits, these settlements only apply to the lawsuits with home seller plaintiffs.  

One of the most common types of motions filed by the defendants on Monday was a move to dismiss for lack of jurisdiction, which were filed by eXp, Douglas Elliman, Keller Williams, Anywhere and RE/MAX. Each of the motions argue that the court lack jurisdiction over the defendants as the firms are headquartered outside of Illinois.

“This Court lacks specific personal jurisdiction over Keller Williams because Plaintiffs did not purchase homes or suffer alleged injuries in Illinois,” an attorney for Keller Williams wrote in the firm’s filing. “Even if they had suffered injuries in Illinois, those alleged injuries were not caused by any activities in which Keller Williams engaged in Illinois.”

Defendants United Real Estate and Weichert made similar claims in their motion to dismiss for lack of jurisdiction and failure to state a claim their filings. Attorneys for Weichert (WREA) also referenced the court’s dismissal of HomeServices of America to bolster their argument.

“This Court recently dismissed all claims for lack of personal jurisdiction as to the HomeServices defendants on the grounds that the defendants were not incorporated and did not have their principal place of business in Illinois, are not members of the National Association of Realtors (“NAR”), and did not play any role in crafting any NAR rules at issue in the case,” the filing states.

“WREA is not incorporated in Illinois, does not maintain its principal place of business there, has no offices, property, employees, or business operations in the State, is not a member of NAR, and played absolutely no role in enacting, enforcing, or implementing any NAR rule.”

While many of the firms, including Weichert, have franchises in Illinois, Weichert’s motion notes that “courts have consistently held that a franchisor relationship is insufficient to confer personal jurisdiction unless the franchisor exerts a high degree of control over the daily activities of the in-state franchises.”

In addition to these motions, the remaining defendants in what was initially the Batton 2 suit — Compass, eXp, Redfin, Weichert, United Real Estate and Douglas Elliman — filed a joint motion to dismiss for failure to state a claim and a motion to strike the complaint.

In their motion to dismiss the suit, the defendants argue that the plaintiffs lack standing to sue the defendants under federal antitrust law, and that the complaint “fails to allege facts to plausibly suggest that the Defendants entered into any agreement — with non-party National Association of Realtors (“NAR”) or amongst the Defendants — and certainly not into any anticompetitive agreement.

“The Complaint instead improperly lumps Defendants into a group and concludes that the group entered into a conspiracy, with no allegations as to how, when, or even if each individual Defendant allegedly entered into an anticompetitive agreement,” the motion continues. “Courts have repeatedly held that this type of vague ‘group pleading’ is insufficient for an antitrust case.”

Additionally, the defendants argue that the plaintiffs “fail to allege any facts showing why they are entitled to any tolling against these Defendants,” and that they “fail to plead sufficient facts in support of certain state law claims against Defendants.”

In their motion to strike the complaint, the defendants claim that the plaintiffs’ proposed damages class is improper because precedent states that no “class action is proper unless all litigants are governed by the same legal rules.” The defendants’ reasoning behind this argument is that the proposed class spans several different states and local jurisdictions, meaning that they are subject to different laws in different geographic areas of the proposed class.  

It remains to be seen how the judge will rule on these motions, but the defendants are most likely viewing the dismissals of Howard Hanna and HomeServices as a source of positivity.