HomeServices of America is one step closer to moving on from the home seller commission lawsuits. On Thursday, Judge Stephen R. Bough — who is overseeing the Sitzer/Burnett and Gibson/Umpa commission cases — granted preliminary approval to the brokerage firm’s settlement agreement.
“The Court finds that the proposed Settlement with HomeServices, as set forth in the Settlement Agreement, is fair, reasonable and adequate, the class representatives have adequately represented the class, the Settlement Agreement was negotiated at arm’s-length by experienced counsel acting in good faith, and the Settlement Agreement was reached as a result of those negotiations; there has been adequate opportunity for discovery and for experienced counsel to evaluate the claims and risks at this stage of the litigation; and the Court will likely be able to approve the Settlement pursuant to Rule,” Bough wrote in his order.
HomeServices of America announced in late April that it had reached a settlement agreement with the Sitzer/Burnett plaintiffs, agreeing to pay $250 million as part of the deal.
The final approval hearing for the settlement is set for Nov 26, 2024, which is the same date as the final approval hearing for the settlement agreement reached by the National Association of Realtors (NAR).
“We were very pleased, in cooperation with the plaintiffs’ representatives, to file our executed settlement and to receive preliminary approval from the Court,” Chris Kelly, executive vice president of HomeServices of America, told HousingWire in an email.
“Our companies and agents have put in tremendous effort to update our forms and practices in anticipation of the business practice changes taking effect later this month. We are confident that the buyers and sellers we serve will have a smooth and positive experience as the industry adapts to these changes.”
In October 2023, a jury in Kansas City, Missouri, determined that NAR and brokerages conspired to inflate or stabilize commissions via NAR’s Participation Rule, which required listing agents to make an offer of compensation to a buyer’s agent. The jury verdict came to $1.76 billion, which could have been trebled to $5.4 billion in damages. It spurred dozens of copycat cases filed in other states and resulted in a series of settlements during the winter and spring.
HomeServices of America is the third-largest brokerage in the country by transaction sides at 235,861 in 2023, according to the latest RealTrends Verified rankings. The Minnesota-headquartered firm had $133.8 billion in sales volume last year, trailing only Compass, Anywhere Advisors and eXp Realty.
