Berkshire unit added to lawsuit over inflated real estate commissions

Agnt

04/03/2024 22:43

By Jonathan Stempel
       NEW YORK, March 4 (Reuters) - A unit of Warren Buffett's
Berkshire Hathaway  BRKa.N  was added on Monday to a lawsuit
accusing the National Association of Realtors and several
brokerages of conspiring to keep real estate commissions
artificially high nationwide.
    The complaint filed in a Kansas City, Missouri federal court
adds Berkshire Hathaway Energy as a defendant, joining Compass
 COMP.N , Douglas Elliman  DOUG.N , eXp World Holdings  EXPI.O ,
Redfin  RDFN.O , United Real Estate and Weichert Realtors.
    Berkshire Hathaway Energy owns HomeServices of America, in
addition to a variety of assets including utilities, pipelines
and renewable energy projects.
    HomeServices was among the defendants ordered last October
by a Kansas City jury to pay $1.78 billion, which a judge could
triple, in a similar antitrust lawsuit covering Missouri agents.
    Monday's complaint will not affect that verdict, which
HomeServices plans to appeal, but could increase Berkshire's
financial exposure from similar litigation.
    Berkshire Hathaway owns 92% of Berkshire Hathaway Energy,
and has the deepest pockets among the defendants, having ended
2023 with $167.6 billion of cash and equivalents.
    According to the complaint, Berkshire Hathaway Energy is
liable for HomeServices' conduct by "supporting and encouraging
the anticompetitive nature of its agents' activities" and
"accepting the ill-gotten gains of the conspiracy."
    Berkshire Hathaway Energy did not immediately respond to a
request for comment after business hours.
    The lawsuit is among several challenging a longstanding
industry practice of having home sellers pay the combined 5% to
6% commissions for their own agents and for buyers' agents.
    Critics say commissions should be lower, and sellers should
be able to list homes on various databases without paying
buyers' agents.
    Real estate generated $4.32 billion of operating revenue for
Berkshire in 2023. Overall revenue for the Omaha, Nebraska-based
conglomerate totaled $364.5 billion.
    The case is Gibson et al v National Association of Realtors
et al, U.S. District Court, Western District of Missouri, No.
23-00788.
    

 (Reporting by Jonathan Stempel in New York; Editing by Stephen
Coates)
 ((jon.stempel@thomsonreuters.com; +1 646 223 6317; Reuters
Messaging: jon.stempel.thomsonreuters.com@reuters.net))