Both ARMLS and Metro MLS have filed a “motion to dismiss” against Zillow. Sadly with everything going on in the industry I’m getting better at reading these legal documents. If you have a time I would recommend reading them, because this will affect many other MLS organizations.
I’m not your attorney but I think the judge will honor their request to dismiss.
“REcore is committed to the progress and modernization of MLS technologies, and we were very impressed by the sophistication of NorthstarMLS’s proprietary tech,” said Katie Smithson, Chief Revenue Officer for REcore. “We look forward to developing further their already great tools into something that a wide range of MLSs and Associations can employ.”
I’ve said it before and I’ll say it again, the ambition of what REcore is doing is amazing. They have their work cut out for them, and will quickly discover that running an MLS organization is not the same of being a vendor. But I wouldn’t bet against them, Art has assembled a great team that has tons of experience. I’m super stoked to be a small part of it.
What impact will the Department of Justice’s stance on the MLS settlement have on the future of buying and selling houses? In this important episode of “Industry Relations,” Rob and Greg talk about a big message from the Department of Justice (DOJ) about the MLS PIN settlement. The DOJ seems to want the court to say no to the settlement. Selling agents might not make as much money as before, and buyers agents might need to show why they’re worth their commission more than ever. It’s time to start thinking about how we can prepare for change and innovate new approaches in serving buyers and seller.
Well we were all speculating whether or not the DOJ would give any clear direction on how they picture compensation to be handled thru the MLS. The DOJ did, and it’s a whooper. Basically they don’t think reducing offers of compensation down to zero matter at all. They want the industry to make a full break from seller setting the buyers agent commission at all. And site “steering” as a concern. So, more like a commercial model. This is something listeners of Industry Relations have heard Rob Hahn echo since the beginning, that steering was the main issue.
In a huge surprise this “Statement of Interest” references the Industry Relations podcast and Rob, myself and Ed Zorn directly,
“Rob Hahn & Greg Robertson interviewing Ed Zorn (VP & General Counsel atCalifornia Regional MLS), Burnett v. NAR: The Lawsuit That Could Upend the Housing Market, Industry Relations (Oct. 18, 2023), starting at 43:40, www.youtube.com/watch?v=pw39NB3w_0o&t=11s (“You do realize under this system (of the seller paying the buyer’s agent directly inside the contract) you do realize a closing statement at a title company or an escrow company looks 100% identical as it does today. With both commissions on the seller side. Nothing changes. The only thing that changes is the number that shows up for the buyer’s agent in that closing statement was negotiated between the buyer directly and the buyer’s agent and had nothing to do with the seller or the listing agent. That’s the one thing that’s different.”
STATEMENT OF INTEREST OF THE UNITED STATES, Department of Justice (DOJ)
I’m not sure whether to be honored or scared shitless that the DOJ listens to our podcast!
For clarity I’ve embedded the YouTube video so that you can see what the DOJ was referencing on our podcast, I started it a bit earlier so you can get some context ( I also think this is good primer to understand what the DOJ is asking for.)
Rob and I record our Industry Relations podcast today at 10AM. Should be a good.
My thanks to REcore for sponsoring this month’s Vendor Alley.
REcore was created by MLS experts to provide modern, sophisticated offerings to MLSs and Associations. REcore has created both SaaS and data licensing solutions, providing simple ways for agents, brokers, and consumers to make quality real estate decisions using listing data and technology.
“REBNY and its technology vendor Perchwell were the first companies to be certified for implementing full-listing Add/Edit. NYC brokers and their vendors have their own listing interfaces that integrate with REBNY’s Residential Listing Service (RLS).
Companies like RESO members Lofty, RealPlus and RESoft send their brokers’ listings directly into the Add/Edit-equipped RLS. Allowing brokers to use whichever apps or systems work best for them to update RLS data greatly enhances product choice and competition.”
I’m a bit late to this but, if this can go mainstream it would be huge for the industry.
“If approved by the court, the settlement means Keller Williams will pay substantially less than it could have to resolve Sitzer | Burnett. On Oct. 31, in a historic verdict, a jury found that Keller Williams, RE/MAX, Anywhere, the National Association of Realtors, HomeServices of America and two of its subsidiaries, BHH Affiliates and HSF Affiliates, conspired to inflate broker commission rates paid by homesellers. The jury awarded $1.78 billion in damages to a class of approximately 500,000 Missouri homeowners. If that award stands, it would be trebled by law to more than $5.3 billion.
The deals leave NAR, HomeServices of America and two of its subsidiaries, BHH Affiliates and HSF Affiliates, as the remaining defendants in the case.”
I’ve been thinking about this for the last week and a couple things stand out. I guess you could say it was shrewd of KW to see if the case was won before settling (interesting to think of NAR and BHH/HSF through that lens). Hard to say if the settlement would have been lower if they had settled earlier. But $70M feels about right. BHH/HSF are probably talking longer due to their corporate structure.
That would leave NAR standing alone. People who would know tell me that their case for appeal is pretty strong based on upon the documents being filed by NAR. That may be true, but the genie is out of the bottle. More and more of people I meet and hear I’m “in real estate” ask me about being “over-charged” for commissions. I still think settling (and sooner than later) is the right move.
“The deal was supposed to give holders of Remine common stock 3 cents per share in cash and 61 cents of equity in the new company, according to the complaint. But shareholders were not paid directly; instead, their portion of the merger consideration was contributed to an operating fund of a company called RM Rollover Holdings LLC. Spinetto, Remine’s chief operating officer, secretary and director, was given control of the operating fund after the merger, the complaint says. Spinetto was given a new job post-closing and got a management bonus. The information statement said nothing about how many shares of common stock he owned, how much of his equity was rolled into the new company, his salary post-closing or the amount of his bonus, the complaint says. Schacknies — who served as Remine’s president, CEO, chief financial officer and a director at the time of the sale — resigned from his role as CEO when the acquisition took place and got a severance package at closing, the complaint says.”