Iowa Realty today announced that the Iowa Supreme Court has upheld a lower court decision to dismiss a civil action brought by Next Generation Realty in September 1999 involving claims of antitrust and attempted monopoly behavior that were found to be without merit or proof.
In February 2003, Polk County District Court Judge Glenn E. Pille dismissed an action filed by Next Generation Realty and Homebuyers Consultants against Iowa Realty. Next Generation initially filed the suit to require Iowa Realty to share commissions, while Next Generation refused to share commissions on its listings sold. When Iowa Realty declined to reciprocate on that basis, Next Generation accused it of violating Iowa’s antitrust statute.
“We’re pleased to have this issue finally put to rest by the highest court in Iowa,” said Iowa Realty CEO R. Michael Knapp. “We continue to believe in our position that companies have the right to decide how they work with each other in the market, especially with those brokerages who choose not to cooperate with others.”
Iowa Realty cited the 56-page opinion, in which Judge Pille wrote, “Next Generation has not presented sufficient facts fairly supportable by the record illustrating the presence of ‘antitrust injury.’ The injuries Next Generation sustained only reflect Next Generation’s own private losses and economic disappointments, and these injuries simply do not likewise result in harm to the consumer and competition generally.”
The Iowa Supreme Court affirmed Pille’s decision and added the following clarification of the state’s antitrust statute: “…antitrust laws were not intended to deal with claimed wrongs inflicted on individual parties. Their function is only to foster the public’s access to a freely competitive market. Antitrust is in place to protect the market, not any individual merchant doing business there…The record here contains no hint that the public was inhibited from access to services of real estate brokers. The proofs are unanimous to the contrary.”
The high court’s decision marks the end to the five-year legal battle.
“For the past five years, we have been defending our right to make decisions for our company against a competitor who tried to use the legal system to run our company for the benefit of its business, not for the benefit of the market or buyers and sellers in Central Iowa,” Knapp said. “Our programs, innovations and business initiatives are designed to enhance competition in the market. We believe that home buyers and sellers in Central Iowa will benefit when we all go back to competing in the marketplace, rather than in the courtroom.”
Iowa Realty is part of HomeServices of America, an affiliate of Berkshire-Hathaway.
Iowa Realty is entangled in another antitrust lawsuit, filed by Coldwell Banker Mid-America Group Realtors in March. In that suit, Coldwell alleged that Iowa Realty and First Realty, both units of HomeServices of America, used their market dominance in Des Moines to eliminate competition by creating a category of for-sale listings that would be exclusive to Iowa Realty and First Realty agents.
The concept of exclusive listings is not new, nor is it illegal. However, the Coldwell Banker company said it believes Iowa Realty’s and First Realty’s exclusive listings would severely limit competition because of their market dominance.
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