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A federal judge has denied a request from Keller Williams to change a trial date in a class action commission lawsuit that could rock the real estate industry, despite the franchisor’s claims that keeping the date would hurt its defense.
The antitrust class action, known as Sitzer/Burnett, is scheduled for a three-week trial beginning Oct. 16 in Kansas City, Missouri. But that trial date may be pushed to a backup trial date of February 26, 2024, because a fellow defendant in the case, HomeServices of America, has filed an appeal that may not be fully decided in time for an October trial.
On June 27, Keller Williams filed a motion to move that backup trial date to March 11 or later, because “the most important annual event that the company hosts,” Family Reunion, would start the same week as the current date. Family Reunion will be held February 25-29 in Las Vegas.
“The annual week-long Family Reunion attracts thousands of Keller Williams agents from around the country and world who gather to network and to hear from and interact with key Keller Williams executives, including Keller Williams’ founder and Chairman, Gary Keller, who will be a witness during the upcoming trial,” KW’s attorneys wrote in the filing.
“It is an all-hands-on-deck event that requires extensive preparation in the weeks leading up to the event and is all-consuming for Keller Williams employees and for Mr. Keller and other key company executives, who make on-stage appearances, engage with agents and franchise leaders, attend breakout sessions, and conduct business meetings with franchise representatives throughout the event.”
The filing goes on to say that it would be “impossible” for KW executives to prepare for the trial and participate in Family Reunion at the same time.
“Even if witness testimony could be sequenced so that Keller Williams’ executives who will likely testify at trial can be in Las Vegas for their Family Reunion roles and in Kansas City for trial, preparation for each requires the undivided attention and focus of those executives,” the filing said.
“Asking Keller Williams or its executives to compromise on either would be unfair and place Keller Williams at a disadvantage in trial preparation.”
But on July 5, Judge Stephen R. Bough of the U.S. District Court in Western Missouri denied Keller Williams’ motion to reconsider the backup trial date, so the date remains February 26. Bough will decide whether the October trial date holds at a September 8 pre-trial conference.
The case was previously set to go to trial this past February 21, but was postponed at the request of real estate franchisor Anywhere and over the objections of the National Association of Realtors, both also defendants in the case. (RE/MAX is also a defendant.) Keller Williams held its Family Reunion February 17-22 this year.
“Keller Williams was prepared to proceed to trial in February 2023 before the Court continued that trial date and, should the Court confirm the October 16, 2023 trial date, Keller Williams will be ready to try the case at that time,” KW’s attorneys said in their June 27 filing.
The suit alleges that some NAR rules — including one that requires listing brokers to offer buyer brokers a commission in order to list a property in a Realtor-affiliated multiple listing service — violate the Sherman Antitrust Act by inflating seller costs. Because the suit received class certification last year, hundreds of thousands of homesellers in four MLS markets in Missouri can ask to be reimbursed for $1.3 billion in commissions they paid to buyer agents in the past eight years — plus potential treble damages that could put the total damages in the case at around $4 billion.
Keller Williams declined to comment for this story. Inman has reached out to plaintiffs’ attorney Michael Ketchmark of Ketchmark & McCreight PC and will update this story if a response is received.
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