BAM Key Details: 

  • On Friday, April 26, 2024, HomeServices of America agreed to a settlement in Sitzer/Burnett, et al, for $250 million. 
  • After vowing to continue its legal fight against the Sitzer/Burnett verdict, and following an unfavorable decision by the U.S. Supreme Court, HomeServices agreed to the settlement amount, along with changes to its business practices. 
  • Michael Ketchmark, lead attorney for the Sitzer/Burnett plaintiffs, hailed the settlement while restating his intention to continue pursuing legal action against Berkshire Hathaway Energy, HomeServices’ parent company. 

Warren Buffet’s real estate brokerage, HomeServices of America, has just agreed to settle with the Sitzer/Burnett plaintiffs for $250 million. 

That’s less than 10% of the $4.7 billion demanded of them by the Sitzer/Burnett plaintiffs in a motion filed March 18th

HomeServices is the last of the defendants in Sitzer/Burnett to reach a settlement, following the National Association of Realtors (NAR), Keller Williams, Anywhere, and RE/MAX

Company leadership had previously vowed to continue fighting the verdict. But after the U.S. Supreme Court denied its petition to overturn the Sitzer/Burnett verdict, time was running out. 

Ultimately, a settlement for a sliver of that $4.7 billion sounds more palatable, even with the changes HomeServices has agreed to make to its business practices to settle Sitzer/Burnett, along with all related lawsuits posing a threat to the firm. 

Debra Kamin broke the news in a New York Times article. Here’s what we know so far. 

It’s not over for attorney Michael Ketchmark

Industry leaders have been waiting for HomeServices to cut its losses and agree to a settlement, especially after the National Association of Realtors (NAR) agreed to a $418 million settlement on March 15th. 

Michael Ketchmark, the lead attorney for the Sitzer/Burnett plaintiffs, who has been at the forefront of settlement negotiations, hailed the deal while restating his intention to continue pursuing legal claims against Berkshire Hathaway Energy—HomeServices’ parent company. 

The long-entrenched mandatory compensation rule is finally dead. A jury of ordinary Missourians spoke, and the industry heard their voice. This settlement allows us to continue to pursue our nationwide case against Berkshire Hathaway Energy and a handful of large corporate brokers.

Michael Ketchmark

Attorney for the Sitzer/Burnett plaintiffs

If approved by the court, the proposed settlement agreement with HomeServices won’t put to rest Mr. Buffet’s legal troubles within the real estate industry. Berkshire Hathaway Energy (BHE) is named in a separate large-scale lawsuit over real estate commissions. 

In March, three home sellers who filed the Gibson antitrust lawsuit last October, amended their claim to add BHE to a list of defendants that include Compass, Redfin, Douglas Elliman, and eXp World Holdings. 

Compass agreed to settle for nearly $58 million last month, but the remaining defendants have yet to follow suit. 

Meanwhile, adding Berkshire Hathaway Energy, part of Mr. Buffet’s multibillion-dollar empire, more than makes up for the relatively tiny payout Compass agreed to. 

Per the complaint, the lawsuit alleges BHE used Mr. Buffet’s reputation to grow its customer base, claiming home sellers working with BHE representatives in 2023 were defrauded by as much as $4.2 billion. 

Stay tuned as we keep you updated on the progress of the HomeServices settlement (among others).