BAM Key Details: 

  • On Wednesday morning, HomeServices of America formally filed a motion requesting a mistrial in the Sitzer/Burnett trial, arguing that a video played the day before by the plaintiffs’ attorney was an “ambush” that severely compromises the defendant’s chances at a fair trial. Attorneys for the National Association of Realtors (NAR) and Keller Williams likewise asked for a mistrial. Judge Stephen Bough denied the motion.
  • Defendants also complained about the plaintiff’s attorney encouraging jurors to check out Inman as a source of information on the trial. Judge Bough asked the jurors if they had read about the trial outside the courtroom. Every one of them answered, “No.”

On Day 8 of the Sitzer/Burnett trial, HomeServices of America continued its defense, calling three key witnesses to the stand for questioning on commission-based steering, cooperative compensation, and agent training. 

On Wednesday afternoon, attorneys for HomeServices filed a formal motion asking Judge Stephen R Bough to declare a mistrial, arguing that a video shown the day before by the plaintiffs’ attorney had severely compromised their chance at a fair trial. 

Read on for the highlights. 

Witnesses testify on commission-based steering and cooperative compensation

HomeServices continued its defense, calling key witnesses to the stand, including— 

  • Mike Frazier, president and CEO of HomeServices’ subsidiary ReeceNichols, and CEO of Berkshire Hathaway HomeServices Kansas City Realty and BHHS Alliance Realty
  • Krista Wilson, senior vice president of brokerage at ReeceNichols 
  • Gino Blefari, HomeServices CEO

Here’s what we learned: 

  • Both Frazier and Wilson testified that commission-based steering typically does not happen today because buyers can see available listings online. Frazier acknowledged, though, that lower commissions could potentially reduce buyer agents’ motivation to show a property. 
  • Asked about the lowest commission she’d ever charged a seller, Wilson replied with 2%, admitting that she usually still offered the buyer agent 3% because, in her words, buyer agents “work hard” and are just as important to a successful transaction as listing agents.
  • Regarding cooperative compensation, Wilson said she had no opinion as to whether it should be mandatory. She testified that ReeceNichols had commission guidelines in the past but that they did not come from HomeServices. 
  • Blefari testified about commission negotiations, clarifying that the commission is negotiable. He also said training is done independently, and cooperative compensation policy exists to make sure real estate agents work together in the best interest of their clients. 

Defendants file a motion requesting a mistrial

Attorneys for HomeServices of America formally filed a motion requesting a mistrial, arguing that a video shown the day before by the plaintiffs’ attorney amounted to an “ambush” that damaged the defendant’s chance at a fair trial. 

Attorneys for Keller Williams and the National Association of Realtors (NAR) also said they wanted Judge Bough to declare a mistrial. NAR attorney Ethan Glass went so far as to say he wants the case dismissed entirely. 

We are not asking for a new trial.

Ethan Glass

Attorney for NAR

Here’s what happened: 

  • On Tuesday, Michael Ketchmark, lead attorney for the plaintiffs, played a segment from a video of a Tom Ferry podcast interview with Allan Dalton, the senior vice president of Berkshire Hathaway Home Services and CEO of Real Living Real Estate. 
  • During that segment, Dalton compared real estate agents who agree to lower their commissions to “hookers” offering their services to “sailors.” For the record, Tom Ferry stated he did not recommend the script during the interview, which is no longer available online.
  • The video was recorded in September 2019, months after the Sitzer/Burnett case was filed.
  • Defense attorneys allege the video segment was not provided in discovery before the trial. It was not included on the plaintiffs’ list of exhibits. Defense attorneys went on to list other occurrences in and out of the courtroom that they argued should prompt Judge Bough to declare a mistrial and, at the very least, start over with a new jury. 

Plaintiffs’ ambush with the highly-prejudicial video is just the most recent event in a series of violative actions. Each and all of them result in the inescapable conclusion that this case has been mistried.

Robert MacGill

Attorney for HomeServices of America

  • It’s not unusual for attorneys in major cases to request a mistrial during the proceedings.
  • MacGill argued that defense attorneys should have been given the opportunity to review the video and depose Dalton and Ferry to gain context around Dalton’s statements—or even to have them testify during the trial. 
  • Judge Bough asked the plaintiffs’ attorneys (Ketchmark, et al) to respond in writing. 
  • Among MacGill’s other arguments in favor of a mistrial, he called out Ketchmark for referencing an Inman article when addressing the eight-member jury, alleging he had thereby encouraged the jurors to research the case outside the courtroom—which is pretty much the opposite of what the judge told them to do on Day One. 
  • Bough polled the jury panel on Wednesday morning to see whether any of them had indeed read any news articles (on Inman or anywhere else) about the case. Each of them replied, “No.” 
  • The judge then instructed them to “disregard any reference to Inman.” 

Ultimately, Judge Stephen Bough denied the motion for a mistrial but agreed to have the video stricken from the record, instructing the jurors to disregard it and reprimanding Ketchmark.  Jurors were also told to ignore any references to a DOJ investigation, which the parties had previously agreed not to discuss during this trial.  

Stay tuned for more as the trial continues.