$711 million is sitting in the commission suit settlement fund, so when do payouts start?
…it remains unknown when and how much eligible class members will receive from the settlement fund.
Nobody in this business is going to lose a minute of sleep over that, and we should be honest about why.
AJ LaTrace at Inman got the filings first. As of September 30th there was $711,251,720.86 parked in Morgan Stanley accounts, which threw off $17,705,101.82 in interest over nine months. The appeals are finished. JND Legal Administration, the administrator, is in the middle of a court-ordered audit it didn’t ask for, and in August it tried to get one of the special masters disqualified. That went about as well as you’d expect.
Three years ago last Saturday a Missouri jury found the commission structure was rigged. Since then this industry rewrote the forms, retrained the entire membership on buyer agreements, changed how compensation gets displayed in every MLS in the country, and absorbed a wave of follow-on suits it is still absorbing. What it got back was a release covering the associations, hundreds of MLSs, thousands of small brokerages and their agents, and practice changes that are settled law now. The “it’s still on appeal” argument died in August.
That was a good trade. I think most of this industry would make it again.
Here’s the part worth remembering. The release stopped at $2 billion. Every brokerage with an NAR member as principal and 2022 residential volume at or under that line got covered for free. Everything above it got carved out and handed an invoice: 0.0025 times average annual transaction volume, deposited within 120 days, to buy into a deal it had no part in negotiating. Michael Ketchmark, plaintiffs’ lead counsel, told Inman at the time that the $2 billion “was a negotiated number with NAR.” Inman counted 93 firms on the wrong side of it.
So yes, it was a good settlement. It was a good settlement for NAR, for the associations, for the MLSs, and for every brokerage under the line, which is nearly all of them. Ninety-three firms landed on the other side of that line, each one free to buy into a deal it had no part in writing. If you want to know whether this industry got off easy, don’t ask NAR. Ask one of them.
