Home brokerage Compass to pay $57.5 mln in antitrust settlement

Compass

22/03/2024 15:44

By Mike Scarcella
       March 22 (Reuters) - Home brokerage Compass  COMP.N  has
agreed to pay nearly $58 million as part of a settlement to
resolve claims that it conspired to overcharge U.S. home sellers
by billions of dollars on the commissions they pay to agents for
home buyers.
    Lawyers for the plaintiffs disclosed the proposed settlement
in Missouri federal court on Friday. The deal must be approved
by a judge.
    The nationwide agreement with New York-based Compass, which
did not admit wrongdoing, comes after the National Association
of Realtors (NAR) and several other large residential real
estate brokerages agreed this month to collectively pay more
than $626 million in related home-seller litigation over
commissions.
    Compass CEO Robert Reffkin in a statement said the company
was pleased to resolve claims against it and was settling to
“minimize distractions.”
    Mike Ketchmark, an attorney for the home-seller plaintiffs,
said “brokers around the country are continuing to join with NAR
in abandoning this broken system. We expect many more
settlements in the coming months.”
    Compass was among many large residential home brokerages
facing claims that they violated antitrust law through a
longstanding practice of requiring home sellers to pay a
commission to the buyer's agent in order to list their homes for
sale.  
    The commission, which is shared between the buyer's and
seller's agents, can run 5% to 6% of a home's sale price.
    A Kansas City, Missouri, jury in October had awarded $1.8
billion in damages to a class of Missouri-area home sellers in
the related case against the National Association of Realtors
and others. 
    Plaintiffs’ attorneys were expected soon to ask a U.S. judge
in Kansas City, Missouri, to preliminarily approve the recent
settlement in that case. In addition to paying $418 million, NAR
promised to eliminate any requirement that sellers offer
compensation to a buyer's broker.
    Seeking preliminary approval will kick off a months-long
process that includes an opportunity for individuals or groups
to object to the NAR agreement.
    The realtors association denied any wrongdoing as part of
its settlement.
    
    The cases are Gibson et al v. National Association of
Realtors et al, U.S. District Court for the Western District of
Missouri, No. 4:23-cv-00788-SRB; and Umpa et al v. National
Association of Realtors et al, same court, No.
4:23-cv-00945-SRB. 
    
    Read more:
    Home sellers say HomeServices owes $4.7 bln in real estate
commissions case
    Home buying costs could fall in big US real estate group
settlement
    Home brokerage Keller Williams to pay $70 mln in antitrust
settlement

 (Reporting by Mike Scarcella)
 ((Mike.Scarcella@thomsonreuters.com;))