Effective immediately, listing brokers and agents may submit listings for sale to the MLS without providing any compensation to the buyer’s agent for cooperation.
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A Multiple Listing Service owned by a large brokerage that caught the attention of the Justice Department is changing its rules related to commissions, even though the federal agency says they don’t go far enough.
On June 20, MLS Real Estate Information Network (MLS PIN) sent an email to its subscribers informing them that effective immediately, listing brokers and agents can submit homes for sale to its platform without providing a buyer’s agent. Compensation for any cooperation.
The change is part of a proposed settlement in a case filed by Nosalek home sellers in which MLS PIN is a defendant. The deal drew criticism from the Justice Department’s antitrust division because it continues to allow preemptive claims through the MLS and elsewhere. In a statement of interest in the case, antitrust enforcers called for “an injunction prohibiting sellers from providing commissions to buyer’s brokers.”
Plaintiffs and MLS PIN made multiple revisions to the settlement agreement to address the DOJ’s concerns, but after continued objections from the agency, MLS PIN pushed back in court, arguing that the DOJ’s proposal itself violated antitrust laws and First Amendment rights. Regulation. MLS PIN has also chosen not to accept a settlement agreement reached by the National Association of Realtors, which requires MLS PIN to rescind MLS’s compensation proposal.
“After careful review, MLS PIN has chosen not to join the proposed NAR settlement,” MLS PIN told subscribers in a June 20 email.
“Instead, MLS PIN has decided to move forward with its proposed settlement with the Nosalek plaintiffs. While the rule changes proposed by MLS PIN as part of the Boston settlement are still awaiting final court approval, MLS PIN has decided to begin implementing those rule changes immediately .
Just as the Federal Commission Suits Moehrl and Sitzer | Burnett and Nosalek seek a class-action lawsuit, claiming that sharing commissions between listing brokers and buyer’s brokers drives up sellers’ costs, is a conspiracy to restrain trade, and violates the X.C. Mann Antitrust Act. MLS PIN has 60 full-time employees and 44,600 subscribers in six New England states and New York.
On June 24, Judge Patti B. Saris of the U.S. District Court for the District of Massachusetts suspended the legal proceedings in the Nosalek case and postponed the trial of the case pending a fair hearing on November 26 to NAR. Ruling for final approval of settlement agreement. Sarris wrote that after the filing, the Justice Department “will have 90 days to review the settlement agreement” under the Class Action Fairness Act.
In a June 21 filing, the Justice Department noted that it has not yet obtained the full contents of the current MLS PIN settlement and asked Saris to “order the plaintiffs to provide the United States with all Part of their proposed agreement includes any confidentiality side agreements. Sarris’ subsequent order did not mention this requirement.
Regarding the MLS PIN rule changes, the first change is that property listings are no longer required to offer cooperative compensation.
“If your seller instructs you not to offer compensation, enter a value of 0 in the Compensation field [the] Songneng [MLS platform],” the email read.
“We would also like to remind all subscribers that the MLS PIN’s rules and regulations never prohibit sellers, buyers, listing brokers and cooperating brokers from negotiating and mutually agreeing to any compensation that differs from the MLS PIN value.”
MLS PIN also said it would roll out other changes under the proposed settlement “as soon as possible” but did not specify when and said it would keep subscribers “aware of this timeline.”
According to the MLS PIN flyer, these additional changes are:
- “If any, the seller will propose compensation. Commissions will no longer be divided between the listed securities firm and the cooperative securities firm.
- The listing agreement must disclose that the seller is neither required to provide compensation nor to agree to any request for compensation from a cooperating broker. The listing broker must disclose this to the seller before the seller signs the listing agreement.
- If the seller chooses to provide indemnification, the listing agreement must also state that the cooperating broker will be the intended third-party beneficiary of the agreement and have the authority to enforce the agreement.
- Before publishing listing information, the listing broker must certify in a checkbox designated for this purpose in Pinergy that the listing broker has informed the seller that the seller has the right not to provide compensation and not to accept the cooperating broker’s request for compensation.
MLS PIN reminded subscribers in an email that the court has not yet formally approved the settlement rule change.
“If the Boston court does not approve our settlement, we may need to further modify our rules and Pinergy or revert to our previous rules,” the email reads.
The MLS PIN also said it will provide education and training on the changes, including “further communications, videos, timelines and details in the coming weeks.”
Inman asked MLS PIN why it decided not to join the proposed NAR settlement, why it decided to implement the rule changes now, and how its subscribers would be affected if the MLS had to withdraw or otherwise modify those rule changes. MLS PIN declined to comment.
The U.S. Department of Justice also declined to comment.
Editor’s note: This article has been updated to note that the Justice Department declined to comment.
Send an email to Andrea V. Brambila.
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