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The National Association of Realtors is not having a good week and it’s only just begun.
The U.S. Court of Appeals for the Ninth Circuit in San Francisco on Monday ruled against the 1.5 million-member trade group and revived an antitrust lawsuit over NAR’s controversial policy aimed at curbing pocket listings.
The decision overturns a federal district court ruling that had dismissed a suit filed in May 2020 by private listing service Top Agent Network against NAR. The suit alleged NAR and the San Francisco Association of Realtors violated a slew of antitrust and unfair competition laws for adopting the Clear Cooperation Policy, which requires listing brokers to submit a listing to their MLS within one business day of marketing a property to the public.
The rule is meant to effectively end the practice of publicizing listings for days or weeks without making them universally available to other agents. Some MLSs have instituted hefty fines to enforce the policy, including SFAR.
A U.S. district court in Northern California tossed TAN’s case against the Realtor associations in August 2021 and TAN subsequently appealed that decision. The company submitted its opening brief to the appeals court in January and the U.S. Department of Justice submitted an amicus brief in the case in March, arguing that the lower court had made legal errors when it tossed TAN’s suit.
In June, the DOJ asked for, and received, permission from the appeals court to speak at oral arguments in the case, but the court ultimately decided to make its decision based on the legal filings without oral arguments.
Former private listing service ThePLS.com filed a similar case against NAR, also in May 2020, challenging the pocket listing policy. That case was also tossed in a lower court — a ruling the company appealed. ThePLS.com won that appeal and the case is now back to the lower district court and is ongoing.
The same appeals court that ruled in favor of ThePLS.com also considered TAN’s appeal. In the end, the court’s judges decided the cases were similar enough to rule in the same way.
“Because the facts of PLS.com are sufficiently analogous to the facts as alleged here, we vacate the district court’s order and remand Top Agent’s claims for reconsideration under PLS.com,” they wrote in a one-page decision.
TAN’s case now goes back to the district court.
David Faudman
“We are pleased that the Ninth Circuit recognized that the District Court’s dismissal order conflicted with its prior decision in the PLS.com case, which strengthened the right of alternate property-sharing services to challenge the NAR’s anticompetitive behavior,” TAN CEO David Faudman told Inman in an emailed statement.
“We look forward to returning to the District Court, where we expect TAN will prove that NAR’s so-called ‘Clear Cooperation Policy’ violates the law and must be modified or ended.”
Inman reached out to NAR for comment and will update this story if and when a response is received.
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