Michigan Real Estate Professionals File Antitrust Lawsuit Against NAR

Three Michigan real estate professionals filed a class-action antitrust lawsuit against the National Association of Realtors (NAR), the Michigan Association of Realtors (MAR), RealComp II and several local Realtor boards. 

The lawsuit, filed on August 12 in the U.S. District Court for the Eastern District of Michigan, alleges that the defendants’ mandatory membership requirements violate federal and state antitrust laws.

Plaintiffs Challenge Mandatory Membership Requirements

The plaintiffs—Douglas Hardy (broker-owner), Glenn Champion (primary broker), and Dylan Tent (real estate agent)—are all associated with Signature Sotheby’s International Realty in Southeastern Michigan. 

They argue that the requirement for brokers and agents to join NAR, MAR, and local Realtor associations to access the Multiple Listing Service (MLS) is a violation of their rights under antitrust laws. 

The complaint states that these requirements hinder real estate professionals’ ability to conduct business in a “fair and unencumbered manner,” causing ongoing damages to their business operations and financial earnings.

Allegations of Economic Coercion and Antitrust Violations

The lawsuit alleges that NAR, MAR, RealComp II, and local Realtor boards, including the Grosse Pointe Board of Realtors (GPBOR), the Greater Metropolitan Association of Realtors (GMAR), and the North Oakland County Board of Realtors (NOCBOR), mandate membership to access the MLS. The plaintiffs claim this practice deprives real estate professionals of free choice and impacts finances through mandatory membership fees.

In the complaint, the plaintiffs argue that the mandatory nature of these memberships “hold(s) hostage access to the MLS,” thereby monopolizing the MLS system.

Impact of NAR’s Settlement

The lawsuit is partly driven by recent changes resulting from NAR’s settlement in the Sitzer/Burnett case. Part of NAR’s settlement agreement—which goes into effect August 17, five days after the new lawsuit was filed—is to prohibit offers of compensation on the MLS. 

Plaintiffs argue this change “greatly diminished any value created by the compulsory membership requirement in their organizations as there is now no guarantee of broker commission associated with using the MLS.” The complaint further alleges that this shift “invites side negotiations, disharmony among agents and brokers and confusion for the consuming public,” potentially leading to discriminatory pricing practices, which could violate fair housing laws.

The plaintiffs also claim that Realcomp II, Michigan’s largest MLS provider, enacted a policy change on July 10, 2024, which made the NAR rule banning offers of compensation in the MLS effective as of July 16, 2024, a month earlier than NAR’s deadline. The plaintiffs argue that this decision “jeopardizes the agreed upon compensation for all pending transactions and will negatively affect those transactions.”

Seeking Class-Action Status and Relief

The plaintiffs are seeking class-action status for their lawsuit, representing all Michigan real estate agents and brokers who are required to be members of NAR, MAR, local Realtor boards, and those who must use Realcomp II to access the MLS. The complaint asserts that these actions have led to “a loss of all Plaintiffs’ earning potential as a collective group, a detriment to their businesses as a whole, and a mandatory requirement that they belong to these associations which no longer results in a financial benefit to them.”

The lawsuit calls for damages, injunctive relief, and a jury trial. The plaintiffs argue that a class action is the most efficient way to address these claims, as individual litigation would be “impracticable” and could result in “varying, inconsistent and contradictory judgments.”

Read the complaint in full below, and stay tuned for updates.