New homebuyer commission suit hits the court docket
While
the
Clear
Cooperation
Policy
is
the
current
hot
topic
in
the
real
estate
industry,
homebuyer
commission
lawsuits
—
which
were
not
part
of
the
numerous
nationwide
settlement
agreements
reached
late
last
month
—
still
persist.
Last
week,
Kevin
Cwynar,
an
Illinois-based
homebuyer,
filed
an
antitrust
lawsuit
against
The
Real
Brokerage,
Real
Broker
LLC,
Realty
ONE
Group,
Realty
ONE
Group
Excel,
Vanguard
Properties
and
The
Agency.
Cwynar
claims
that
policies
the
National
Association
of
Realtors
(NAR)
had
in
place
prior
to
its
settlement
business
practice
changes
going
into
effect
in
August
2024
resulted
in
buyers
paying
inflated
commissions.
NAR
is
not
named
as
a
defendant
in
the
suit.
Rather,
the
trade
group
along
with
“NAR
MLSs,
NAR-affiliated
brokerages
and
Realtor
associations”
are
named
as
co-conspirators.
Additionally,
the
suit
alleges
that
the
defendants
are
all
“heavily
intertwined
with
NAR.”
“NAR
frequently
names
brokers
from
large
residential
real
estate
firms
such
as
Defendants
and
their
co-conspirators
to
serve
in
leadership
positions
concurrently
with
their
position
as
real
estate
brokers.
For
example,
Vanguard’s
Nina
Dosanjh
serves
as
a
Director
for
the
NAR
and
has
chaired
the
NAR’s
Federal
Technology
Policy
Committee,”
the
filing
states.
“Similarly,
Defendants’
brokers
frequently
serve
in
leadership
roles
in
REALTOR
associations
in
Illinois.”
Cwynar
is
being
represented
by
Colin
Primo
Cuscraini,
an
attorney
at
McGuire
Law
PC.
This
is
the
first
homebuyer
commission
suit
not
filed
by
attorneys
at
either
Freed
Kanner
London
&
Millen
or
Korein
Tillery.
According
to
the
complaint,
which
was
filed
in
U.S.
District
Court
in
Chicago,
the
brokerage
defendants
engaged
in
and
facilitated
“a
conspiracy
that
has
perpetuated
anticompetitive
measures
in
the
real
estate
broker
services
market
within
Illinois
and
nationwide.”
“Defendants
and
their
co-conspirators
adopted
and
implemented
anticompetitive
practices
that
harmed
consumers
and
homebuyers
by,
among
other
things,
increasing
and
artificially
sustaining
the
commissions
paid
to
real
estate
brokers
as
part
of
residential
real
estate
transactions,”
the
complaint
states.
Prior
to
the
NAR
settlement
business
practice
changes
going
into
effect
last
year,
Cwynar
claims
that NAR’s
Participation
Rule
and
other
stipulations
“prohibited
buyer-agents
from
making
purchase
offers
contingent
upon
a
reduction
of
the
buyer-agent’s
commission.”
He
also
claims
there
was
a
prohibition
on
“the
disclosure
to
buyers
of
the
commission
to
be
paid
to
buyer-agents.”
“The
result
is
that
the
amounts
of
buyer-agents’
commissions
became
artificially
elevated,
and
this
fact
was
opaque
and
ill-understood
by
the
homebuyers
whose
home
purchases
funded
those
commissions,”
the
complaint
states.
“These
anti-competitive
rules
have
permitted
Defendants
and
their
co-conspirators
to
sustain
buyer-agent
fees
at
artificially
high
levels
which
would
not
exist
in
a
competitive
marketplace.”
The
complaint
also
alleges
that
agents
routinely
steered
clients
to
properties
offering
higher
commissions
as
NAR-affiliated
MLSs
allowed
agents
to
filter
searches
for
properties
by
commission
amounts.
“Naturally,
this
conflict
of
interest
led
to
buyer-agents
promoting
properties
that
would
maximize
their
commission,
which
lowered
demand
for
properties
that
offered
lower
commissions
and
thus
eliminated
competition
from
discount
brokers,”
the
complaint
states.
“This
harmed
homebuyers,
who
received
diminished,
biased
services
from
buyer-agents
who
steered
homebuyers
toward
purchasing
homes
that
offered
high
commissions.”
The
Real
Brokerage
and
Realty
ONE
Group,
each
of
which
have
settled
the
home
seller
commission
lawsuits,
declined
to
comment
when
reached
by
HousingWire.
The
suit’s
other
defendants
did
not
return
requests
for
comment.
The
suit
is
seeking
class-action
status.
Cwynar
is
demanding
a
jury
trial,
damages
and
a
permanent
injunction
enjoining
“the
defendants
from
maintaining
or
reestablishing
the
same
or
similar
anti-competitive
rules,
policies,
or
practices
as
those
challenged
in
this
action
in
the
future.”