The National Association of Realtors faces increasing pressure as the Supreme Court allows the Department of Justice to resume its antitrust investigation, while also confronting potential legal challenges over its Clear Cooperation Policy.
At a Glance
- Supreme Court denied NAR’s petition to review an appellate court decision, allowing DOJ to resume its antitrust investigation
- NAR President Kevin Sears acknowledged the end of the appeals process after exhausting all legal options
- NAR is evaluating its Clear Cooperation Policy amid threats of additional legal action from plaintiffs in the Gibson commission lawsuit
- The Clear Cooperation Policy requires brokers to list properties on multiple listing services within one business day
- Decision on the future of the Clear Cooperation Policy expected soon as NAR works to rebuild partnership with DOJ
Supreme Court Rejects NAR’s Appeal
The National Association of Realtors (NAR) received a significant setback when the Supreme Court denied its petition to review an appellate court’s decision that allows the Department of Justice (DOJ) to resume its antitrust investigation. The investigation had previously been closed following a 2020 settlement agreement between the organizations. NAR filed its petition with the Supreme Court in October, seeking to enforce the settlement terms and prevent the DOJ from reopening its investigation into the real estate industry’s practices.
The Supreme Court’s rejection was not entirely unexpected, as the high court accepts only about 1% of petitions it receives. With this denial, the U.S. Court of Appeals for the D.C. Circuit’s decision stands firm, giving the DOJ the green light to proceed with its investigation into possible anticompetitive practices within the real estate industry. This development marks a critical moment for the relationship between NAR and federal regulators as they navigate complex antitrust issues.
Clear Cooperation Policy Under Scrutiny
While dealing with the DOJ investigation, NAR faces another critical decision regarding its Clear Cooperation Policy (CCP). Adopted in May 2020, this policy requires brokers to list properties on a multiple listing service (MLS) within one business day of signing a listing agreement. The policy was designed to prevent “pocket listings” – properties not advertised to the general public – but has become increasingly controversial, with supporters claiming it ensures fair housing opportunities and critics arguing it limits homeowners’ marketing rights.
The decision on whether to maintain, modify, or eliminate CCP is being closely monitored by Michael Ketchmark, lead plaintiffs’ counsel in the Gibson commission lawsuit. That lawsuit accused NAR and major real estate brokerages of conspiring to inflate agent commissions in violation of federal antitrust law. Although NAR has settled its part in the Gibson lawsuit, individual brokers could still face legal scrutiny depending on how NAR proceeds with CCP.
NAR’s Response and Path Forward
NAR President Kevin Sears has acknowledged the challenge ahead, indicating that the organization is committed to addressing these issues. While expressing disappointment with the Supreme Court’s decision, Sears confirmed that NAR continues to engage with the DOJ and is prioritizing this relationship. Additionally, the organization is nearing completion of its evaluation of the Clear Cooperation Policy, with a decision expected soon, though it remains unclear exactly who will vote on the matter.
“This remains a priority for the NAR leadership team, along with NAR’s ongoing evaluation of the Clear Cooperation Policy,” Sears says.
Critics of maintaining the CCP, including Ketchmark, argue that NAR’s fair housing justification is questionable and believe the free market should determine listing practices. Ketchmark maintains that repealing CCP would not lead to large brokerages withholding listings from platforms like Zillow and Realtor.com, as some supporters of the policy fear. The outcome of this decision will likely have significant implications for the real estate industry and could determine whether NAR faces additional legal challenges from plaintiffs in the Gibson case.