Just as you may have been getting comfortable with the new requirements for written buyer agency agreements, changes may be on the horizon!
The United States Department of Justice (“DOJ”) filed its Statement of Interest (“SOI”) on November 24th, two days before the final hearing for the Sitzer/Burnett settlement.
WHAT TO KNOW
- In its SOI, the DOJ reiterated that while it “did not participate in either this litigation or the proposed settlement, the proposed settlement does not limit the United States’ ability to enforce the antitrust laws, including to seek greater relief for the conduct at issue…”
- Specifically, the DOJ is taking aim at the provision in the proposed settlement that requires buyers enter into a written buyer brokerage agreement before the buyer tours any home.
- The DOJ asserts that this requirement will harm buyers and limit broker competition:
“[B]uyer brokers under the proposed rule may not show a house, even a no-obligation showing, without first obtaining a written agreement. Thus, the concerns remain that the broker agreement rule may limit how brokers compete, and there is no record available in the current posture addressing this concern. It is therefore important that any settlement not purport to preclude future antitrust scrutiny.”
DOJ PROPOSED SOLUTION
In its SOI, the DOJ requested that the court:
- Eliminate the buyer-agreement provision from the settlement entirely, OR
- Include a disclaimer that the settlement creates no immunity or defense under anti-trust laws, OR
- Clarify that approval of the settlement doesn’t provide any immunity or defense for the buyer-agreement provision.
The DOJ generally abstained from taking a position on whether the settlement, as a whole, satisfies legal requirements. Rather, the DOJ is requesting clarification of its position, namely that the settlement would not preclude it from taking further enforcement actions, seeking greater relief for said conduct, and scrutinizing potentially this and other anti-competitive practices in real estate.
WHAT DOES THIS MEAN?
If the DOJ continues to pursue this current course, then the requirement to obtain buyer broker agreements prior to touring a home will continue to be under scrutiny.
The landscape and new rules will continue to evolve and with DOJ leadership changing in a couple of weeks, it will certainly be interesting to see if they continue to look into these matters.
Questions? Comments?
For more information on this development or the NAR settlement, please reach out to:
Josh Wirth, Esq.
Managing Attorney
703-584-9828