The National Association of Realtors (NAR) is facing yet another lawsuit related to its three-way membership agreement, which requires Realtors to join their local, state and national associations.
The suit was filed Nov. 1 in U.S. District Court in Los Angeles by John Diaz, a broker at UHOO Real Estate Services, who is representing himself pro se. The defendants include NAR, the California Association of Realtors (CAR), the Lodi Association of Realtors (LAR) and MetroList MLS. The antitrust suit seeks damages, injunctive relief and a jury trial.
The suit claims that the defendants “have established an exclusionary practice, requiring brokers to join multiple associations (NAR, CAR, and LAR) to gain access to MLS services provided by MetroList, which are essential for conducting real estate transactions.” It goes on to state that the membership requirement “constitutes an unlawful tying arrangement,” as brokers and agents “must ‘purchase’ association memberships they may not need or want to obtain MLS services.”
According to Diaz, the three-way membership agreement has “created an anti-competitive monopoly over MLS services, limiting the market’s ability to support alternative trade organizations, thereby stifling competition in violation of the Sherman Act.” The plaintiff also claims that he has “experienced a significant financial burden” due to the membership dues and MLS fees, which he said have “diminished his revenue and impeded his business.”
Additionally, Diaz claims that the defendants have breached their contractual obligations by failing to “provide equitable value and service proportional to the fees paid by Plaintiff.”
“Defendants have violated the implied covenant of good faith and fair dealing by imposing excessive fees and forced memberships that serve no legitimate business purpose for Plaintiff,” the complaint states.
None of the defendants returned HousingWire‘s requests for comment.
NAR currently faces two other antitrust suits — Hardy and Muhammad — that involve similar allegations. Additionally, the Alabama Association of Realtors sent a letter to NAR asking it to end the three-way agreement.
But earlier this week, in a speech in front of NAR members and its board, trade association CEO Nykia Wright sought to quiet any discontent over the policy.
“We are here to make sure that those rumblings subside,” she said, “because it is our duty to make sure that people understand what happens at the local level, the state level, the national level, and really make sure that people understand that there is no cannibalization of services, but it’s really working together to make things work.”
