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The very long list of commission lawsuits got a little longer thanks to a pair of consumers who filed a unique new case in Illinois.
Filed in late February, the new case includes two plaintiffs: Mary Maslanka, who, according to the complaint, sold a home in the Chicago area in 2012, and David Freifeld, who both bought and sold Chicago-area properties in 2019. Both plaintiffs used brokerage Baird & Warner to handle their transactions, and the brokerage is named as the only defendant in the case.
Inman has reached out to Baird & Warner and will update this story with any commentary the company provides.
The naming of a single defendant is atypical for a commission lawsuit; high profile cases such as Sitzer | Burnett have targeted multiple entities, and in some more recent suits, the list of defendants includes numerous companies, multiple listing services and Realtor associations.
The new Maslanka case — commission lawsuits are typically named for their lead plaintiff — is unique in several other ways as well. For one thing, it was filed in the Circuit Court of Cook County, Illinois, and alleges Baird & Warner broke state laws including the Illinois Antitrust Act and the Illinois Consumer Fraud and Deceptive Business Practices Act. The complaint lists four counts against Baird & Warner.
On the other hand, other commission lawsuits have been filed in federal court and argue that defendants broke federal antitrust laws.
Despite that difference, though, many of the broad strokes of the case are similar to other commission lawsuits. For example, the complaint alleges Baird & Warner engaged in “a conspiracy that perpetuates anti-competitive measures.” The National Association of Realtors is not named as a defendant in the suit, but is described in the complaint as a “co-conspirator.” And together, NAR and Baird & Warner “implemented anti-competitive rules that directly harm homebuyers, including mandating that a set portion of the home sale price be allocated toward buyer-agent commissions,” the complaint claims.
That language closely parallels other commission lawsuits, which have taken issue with the practice of having sellers’ agents make offers of compensation to buyers’ agents.
The Maslanka lawsuit also differs from other cases in another way: It’s seeking class-action status on behalf of both homebuyers and sellers. According to the complaint, the buyer and seller classes would include anyone in Illinois who used a Baird & Warner agent to transact on a property that was listed on an NAR-affiliated MLS, going back to 1996. The complaint states that “there are at least tens of thousands, if not hundreds of thousands, of members of each of the classes.”
Most other cases have sought to represent only buyers or sellers. Sitzer, Moehrl and other cases, for example, were filed by groups of homesellers who objected to having to pay a commission to buyers’ agents. Batton 2, on the other hand, was initiated by homebuyers.
The differences between the various cases notwithstanding, commission suits generally have grown into one of the defining stories in the real estate industry of late — and are prompting significant speculation about coming disruptions. Several companies — Anywhere, RE/MAX and Keller Williams — have already settled suits, but new cases that draw in new companies and trade organizations are popping up virtually every week.
In the case of the Maslanka suit, the plaintiffs ultimately ask for a jury trial and various damages, including “an amount equal to three times their actual damages under the Illinois Antitrust Act.”
Read the full Maslanka complaint here:
