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Based on comments at this year’s NAR NXT conference, it appears the National Association of Realtors (NAR) is intent on gambling with its members again. We discussed this in another article, but let’s revisit two obvious lawsuits that members may face.
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Possibility of class action lawsuit No. 1
Five years ago, NAR introduced a Clear Cooperation Policy (CCP) to “level the playing field,” requiring properties to be shared with multiple listing services (MLS) within 24 to 48 hours. While the intent was to ensure fair access for all members, this policy forces homeowners into a one-size-fits-all approach, except for office use only.
As I predicted last year, the era of the Chinese Communist Party is coming to an end, and change has already begun. This is why NAR needs to pay attention to the writing on the wall if it wants to avoid multiple class action lawsuits in 2025.
Why is it necessary to abolish a clear cooperation policy?
Explicit cooperation policies have recently come under increased scrutiny, particularly for their potential to violate seller rights and violate antitrust laws. This rule, which forces some homeowners to share their properties with other members regardless of their wishes, oversteps its bounds and undermines the legitimate interests of sellers who prioritize privacy and exclusivity. It excludes options.
The current Department of Justice (DOJ) has emphasized antitrust concerns surrounding the Chinese Communist Party, and major companies such as Anywhere Real Estate and Compass are calling for the policy to be repealed or at least significantly changed.
NAR avoided the topic at the recent NXT conference, indicating that they are still in “move on” mode. Their inaction could very well make us the target of the next class action lawsuit. This isn’t just a fight over industry practices; it’s about getting power back to homeowners.
I know what some of you are thinking. It is possible that the incoming presidential administration and the new Department of Justice decide to stop pursuing NAR.
While that may be true, clear cooperation policies remain ripe for class action litigation because class action lawyers are not worried about the Justice Department. Their interest is in recruiting plaintiffs. That could end up costing NAR and its members hundreds of millions of dollars more (and more headaches) than they have experienced to date.
The exclusion of the Chinese Communist Party has already begun in some local markets. Park City Board of Realtors Example: In October, Utah’s Park City Board of Realtors informed its members that it would no longer enforce NAR’s explicit cooperation policy. This decision marked a significant departure from NAR’s guidelines and allowed local MLSs to operate without following specific national association mandates.
The bottom line is that sellers should have the freedom to choose how they want to market their property, whether through the MLS, exclusive brokerage, or other methods. Protecting their rights is important not only for antitrust compliance but also for industry trust and credibility.
Agents need to pivot
The abolition of the Chinese Communist Party will significantly change the way agents operate. Buyer’s agents have relied on this rule for years to easily access listings through the MLS. Once the rules are gone, that access may shrink.
I predict that 20 percent of the listings, a significant portion, will remain exclusive and never appear on the MLS. For agents who rely heavily on viewing other agents’ lists, this change will feel like a wake-up call. What is the solution? Pivot now.
Master the list side of your business. Going public is where control, influence, and long-term stability in this industry is determined. Invest in building the skills and strategies you need to excel as a listing agent.
For now, make this your main focus. Your future business depends on it.
Possibility of class action lawsuit No.2
Another prediction I made last year is coming true. That is the separation of MLS and NAR. Let me explain why this is the next class action lawsuit.
Forcing agents to join NAR in order to access MLS services is a classic example of illegal “tying” under antitrust law. This approach bundles two separate products: NAR membership and MLS access, and agents must purchase one to obtain the other.
Such arrangements stifle competition by excluding non-NAR agents from important industry tools, creating a monopoly-like scenario. Courts have long held that tying agreements that limit freedom of choice and restrict competition violate antitrust laws such as the Sherman Act and the Clayton Act.
Several multiple listing services (MLS) have recently announced that their policies differ from local or NAR policies arising from commission litigation settlement provisions. Some notable examples are:
Bright MLS: Bright MLS, serving the Mid-Atlantic region, has added an option to indicate in a listing whether a seller is willing to provide a buyer’s agent commission. California Regional MLS (CRMLS): One of the nation’s largest MLSs, CRMLS will indicate in mid-2024 whether sellers are willing to consider concessions and, if so, what they intend to offer. announced the decision to allow the listing. Northwest MLS (NWMLS): NWMLS, which covers the Pacific Northwest, has chosen to opt out of the NAR settlement, stating that the “settlement agreement eliminates transparency of compensation to buyers and allows sellers to make compensation offers through the MLS. “By prohibiting such activities, it restricts sellers’ choices.” ”
Why is this happening? With a growing number of lawsuits, including the most recent Tripartite Membership Agreement lawsuit filed in California, NAR has become a liability for MLSs. There is. This latest lawsuit was filed by John Diaz, an agent with UHOO Real Estate Services.
The lawsuit, filed in U.S. District Court in Los Angeles, names NAR, the California Association of Realtors, the Lodi Association of Realtors, and Metrolist MLS as defendants. The case adds to the growing legal challenge to the necessity and legality of requiring real estate agents to join multiple associations just to access the MLS.
This is not an isolated incident. Similar lawsuits have been filed in Michigan, Illinois (later dropped with plans to refile the case), and Pennsylvania. The Alabama Association of Realtors also expressed concerns and urged NAR to make membership voluntary. This series of lawsuits highlights how associations and MLSs are reevaluating their relationships with NAR to avoid getting dragged into legal trouble.
The writing on the wall says, “More MLS will follow.” This means that it is important for agents to quickly adapt to these changes. Focus on building a strong, publicly traded business, stay informed about the evolving legal landscape, and invest in ongoing training to stay ahead.
Three things to pay attention to now
A year ago, I said this was coming, and now the collapse of the Chinese Communist Party and the separation of MLS from NAR could be unfolding before our eyes.
Here’s what you should do now to stay ahead of the curve.
Step up your listing game: Listings are the foundation of success in this new era, giving you the opportunity to control, leverage, and succeed. Stay informed: Stay aware of evolving NAR policies, ongoing litigation, and how these changes impact the market. Knowledge is power. Invest in training and resources: Agents who adapt fastest will lead the pack. Focus on building the skills you need to stay competitive and relevant.
This is your chance to pivot and build your strategy to position yourself as a leader in changing times.
call to action
This is a moment of transformation in our industry, and we have the choice to adapt or retreat. Don’t wait for the market to decide your future. Take control.
Because in this business, agents who adapt win. Will you be one of them?
