The parent company of Howard Hanna Real Estate Services argued that the plaintiffs agreed to the mediation terms and, as buyers, lacked standing to sue under federal and state antitrust laws.
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Hanna Holdings Inc. is fighting back an antitrust lawsuit that accuses it of conspiring with other members of the National Association of Realtors to inflate buyer’s agent commissions, resulting in higher home prices for buyers.
On Aug. 5, the parent company of brokerage Howard Hanna Real Estate Services filed a motion to dismiss the lawsuit, one of several commission lawsuits filed by homebuyers. Settlements have been announced across the country despite major commission cases brought by home sellers such as Sitzer | Burnett and Mohr, neither covered buyer claims.
The filing asks the U.S. District Court for the Eastern District of Pennsylvania to either dismiss the case “with prejudice,” meaning permanently, or transfer it to Howard Hanna’s Western District of Pennsylvania.
“This is a case that should never have been brought, and if it had to be brought, it should not have been brought here,” the filing reads.
“The complaint is nearly identical to an amended complaint filed in another court by the same attorney (also representing the homebuyers), making the same claims and challenging National Association of Realtors (NAR) guidelines.”
Homebuyer Scott Davis filed the lawsuit on May 31, seeking class action status. . In March, Batton 2 plaintiffs had their Howard Hanna lawsuit dismissed without prejudice, meaning the claims could be filed later.
Davis, a North Carolina resident, purchased a home in Greensboro in 2022 through a buyer’s agent at Allen Tate Real Estate, a subsidiary of Hanna Holdings. Hanna’s motion to dismiss argued that Davis’ agreement with Allen Tate included a mediation provision that provided “[i]fa The dispute arises from or [is] Conduct related to this Agreement or a breach of this Agreement. . .The parties agree to first make a good faith attempt to resolve the Dispute through mediation before resorting to arbitration, litigation or other dispute resolution proceedings.
“Plaintiff has failed to fulfill its contractual requirement to mediate prior to filing suit,” and the lawsuit should be dismissed, the motion states.
The complaint alleges that Hanna Holdings violated federal and state antitrust laws by participating in the “formulation, maintenance and enforcement” of multiple NAR rules that are alleged to be anticompetitive, including the trade group’s cooperative compensation rule, also known as the “Engagement Rule.” .
Hanna’s motion to dismiss argued that Davis lacked standing to sue under those laws.
“Plaintiffs lack standing to bring substantially all state law claims because plaintiffs can only sue under the laws of the state in which they reside or were injured,” the motion states.
“Plaintiff sued under the laws of 35 states, but lived and purchased homes only in North Carolina. Therefore, all other state law claims must be dismissed.
“Plaintiffs also lacked antitrust standing to sue under the Sherman Act and many state laws, including North Carolina law, because, as the Patton court recognized, the homebuyers were not the buyers’ brokers who allegedly overpriced their properties. direct purchaser of human services.
“So not only are homebuyers unable to seek damages under the Sherman Act and many state laws…, they are also unable to obtain an injunction under the Sherman Act and cannot obtain an injunction under North Carolina’s countervailing law. Monopoly law (or its consumer protection law) recovers damages because the home seller plaintiffs are more effective enforcers of antitrust law…”
Hanna’s attorneys also argued that Davis “did not reasonably allege that there was an agreement between the defendants and the alleged co-conspirators and that there was no relevant antitrust market.” Davis’ indictment does not name any other defendants. But it does name several parties as Hanna’s co-conspirators, including Anywhere (formerly Realogy), RE/MAX, Keller Williams, HomeServices of America, Compass, eXp World Holdings, Redfin, Weichert Realtors, United Real Estate Group, Douglas Elliman, NAR, local REALTORS associations, REALTOR AFFILIATED MLS and Hanna Holdings franchisees and brokers.
The case is scheduled for a pretrial conference on August 20.
Inman has reached out to Carol O’Keefe of Korein Tillery, the plaintiffs’ attorney, for comment and will update this story when we hear back.
Read the motion to dismiss:
Send an email to Andrea V. Brambila.
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