BAM Key Details:

  • Tracy Kasper, president of the National Association of Realtors (NAR) posted a video on November 7th addressing the Sitzer/Burnett verdict.
  • Kasper expressed optimism about NAR’s future and addressed questions about the verdict, what it means for real estate agents, and what Realtors should tell clients who ask about the verdict or lawsuits

The president of the National Association of Realtors (NAR), Tracey Kasper, posted a video on Tuesday, November 7th, to address the Sitzer/Burnett verdict. 

Leading with “I was incredibly disappointed by the verdict,” Kasper went on to blame NAR’s defeat on the jury:

The jury reached an outcome that was neither supported by the law nor the facts that were presented in this case.

Tracy Kasper

NAR President

Is NAR’s defense to blame?

Kasper went on to address questions as to whether NAR’s legal team put on witnesses to shed light on why NAR’s cooperative compensation rule was the best solution, even if other countries took a different approach. 

I’ve heard questions on whether our team put on witnesses to help us to tell our story. And I want you to know we did. For example, our legal counsel put on independent Realtor and past president Sharon Millet, who shared her personal story about how NAR rules serve the best interest of our consumers, support market-driven pricing, and advance business competition. We also put on expert witnesses, including an economist who explained why our practices actually benefit sellers and buyers and promote competition. Unfortunately, as you all know, the jury did not rule in our favor.

Tracy Kasper

NAR President

In this week’s episode of The Real Word, Byron Lazine had this to say in response: 

One of the issues I had with the defense…you’ve got these plaintiff witnesses that have sold a home. And you didn’t have their specific agents… Tracy’s like, ‘I heard from a lot of people that said we didn’t have any agents. We did. We had so-and-so who was the ex-president of NAR over a decade ago’ …No, that’s not what I’m talking about, Tracy. I’m talking about the five witnesses for the plaintiffs. Where are those five agents that were in the business in these last five years?

Byron Lazine

Of course, Byron acknowledged the defense lawyers might know something he doesn’t but added that it seemed obvious, when you have a dispute between two parties, to let representatives from both sides speak. 

The plaintiffs had their moments on the stand. But no one spoke for the agents who assisted them in selling their homes. 

Instead, defense counsel called a former NAR president and a chief economist to the stand, neither of which were as likely to resonate with the jury as the plaintiffs themselves. 

A Complex Legal Situation

In the video, Kasper clearly stated “We plan to appeal the verdict.” But, as the process proceeds, which will likely be long and drawn out, new legal developments could arise. She noted the following examples:

  • “The plaintiffs in Missouri may ask the court to issue an order that changes the rules about cooperative compensation.”
  • “We may see additional plaintiffs come forward to make similar allegations in new cases.”

While NAR plans to move forward with an appeal, Kasper’s message did not include a clear set of next steps, but rather an admittance of not knowing what the process involves. 

We are working around the clock to evaluate the situation and get the very best advice about a path forward. 

I know a lot of us are wondering what does all of this mean for our businesses and how we serve our clients. And I understand your feelings at this point. We don’t have all the answers about how the future will pay out, but what I can do is offer guidance to help you as you continue to do business and to take care of your clients.

Tracy Kasper

NAR President

Her guidance, in short, is to remain transparent about your services, be clear that commissions are negotiable, share exactly how you get paid, and review all options available to consumers. 

NAR’s approach needs a makeover

NAR went into the Stizer/Burnett trial confident it would play out in their favor. But based on the federal jury’s quick decision, their defense doesn’t make the cut. 

Since 2019 until this blew up in NAR’s face, (they) said, ‘Don’t worry about it.’ (Their) defense during the trial was ‘This is ridiculous!’ That’s not a defense. That’s not good enough. That defense doesn’t cut it. And then you’re handed down this verdict and now it’s like, ‘Well, I don’t know where we go from here, but make sure everything is transparent.

Byron Lazine

Transparency will help, sure. But if NAR leadership can’t see where the plaintiffs are coming from and why their attorneys did a better job of persuading the jury, this won’t be the first time a verdict knocks them sideways. 

So, what can NAR do to uphold buyer agency and the commission structure in its appeal to Sitzer/Burnett and in trials for the Moehrl and Batton lawsuits?

It can start by getting people on the stand that the jury can actually relate to. The legal team for the defense should be brought up to speed on how to relate to regular people. Talking down to them, as Ethan Glass did during his closing argument for NAR, is not the move. 

Maybe they could do with a few pointers from Michael Ketchmark.