– RE/MAX and Anywhere Real Estate have received preliminary approval of their settlement agreements in commission lawsuits.
– The settlement agreements require RE/MAX to pay $55 million and Anywhere to pay $83.5 million.
– Policy and practice changes are also required, including no longer requiring agents to be members of NAR or follow NAR’s Code of Ethics.
– The settlement agreements also outline changes in commission negotiations and cooperation with other brokers.
– Both companies are pleased with the court’s decision and anticipate final approval of the settlement next year.
– The parties must schedule a final approval hearing before December 22, 2023.
– It is unknown if the Department of Justice will get involved in the Sitzer/Burnett suit.
– The real estate industry remains in limbo as more lawsuits are expected and a final ruling is not expected until mid-to-late spring 2024.
RE/MAX and Anywhere Real Estate can breathe a sigh of relief. The two corporate brokerages have received preliminary approval of their settlement agreements in the Sitzer/Burnett, Moehrl and Nosalek commission lawsuits. Judge Stephen Bough, who oversaw the Sitzer/Burnett trial last month in Missouri’s Western District, granted the settlements preliminary approval Monday morning.
“The Court finds that the proposed Settlements with Anywhere and RE/MAX, as set forth in the Settlement Agreements, are fair, reasonable and adequate,” Bough wrote in his motion granting preliminary approval.
Some of these provisions include no longer requiring agents to be members of the National Association of Realtors or following NAR’s Code of Ethics or the MLS Handbook. Practice changes outlined in the settlement agreements include that the firms will require or encourage agents to make it clear to clients that commissions are negotiable, that agents will have the freedom to set or negotiate commissions as they see fit, and that agents will not be required to make offers of compensation or accept offers of compensation from cooperating brokers.
“We are pleased with the court’s decision to grant preliminary approval of the settlement,” Nick Bailey, the president and CEO of RE/MAX, LLC., said in a statement. “This development signifies progress in our ongoing efforts and commitment to a resolution – it’s a positive step forward in bringing these cases closer to the finish line.”
In an email, a RE/MAX spokesperson also noted that the firm anticipates the final approval of the settlement some time next year.
At Anywhere, CEO and president Ryan Schneider was equally as pleased.
“Our efforts to resolve these claims remove future uncertainty and legal expense for Anywhere, our franchisees, and affiliated agents as, together, we focus on serving home buyers and sellers as they move to what’s next,” Schneider said in a statement.
According to the order, the parties must contact the court prior to Dec. 22, 2023, to schedule final approval hearing.
While Bough’s motion answers one of the questions left by the jury verdict in the Sitzer/Burnett trial, much remains unknown. It is also yet to be seen if the Department of Justice will try to get involved in the Sitzer/Burnett suit as it has already done in the Nosalek lawsuit. Many analysts and observers expect the DOJ to get involved at some point.
Property Chomp’s Take:
The recent news surrounding RE/MAX and Anywhere Real Estate receiving preliminary approval of their settlement agreements brings relief to both corporate brokerages. These settlements are related to the Sitzer/Burnett, Moehrl, and Nosalek commission lawsuits. Judge Stephen Bough, who oversaw the Sitzer/Burnett trial, granted preliminary approval for the settlements.
The settlement agreements require RE/MAX to pay $55 million and Anywhere Real Estate to pay $83.5 million. Additionally, both companies are required to make policy and practice changes. These changes include no longer mandating agents to be members of the National Association of Realtors or follow their Code of Ethics. The firms will also ensure that agents have the freedom to negotiate commissions as they see fit and are not obligated to make or accept offers of compensation from cooperating brokers.
The granting of preliminary approval is seen as a positive step forward for both brokerages. Nick Bailey, the president and CEO of RE/MAX, expressed satisfaction with the court’s decision and stated that it brings the cases closer to resolution. RE/MAX anticipates the final approval of the settlement in the coming year. Anywhere Real Estate’s CEO and president, Ryan Schneider, also expressed relief, highlighting the removal of future uncertainty and legal expenses for the company and its affiliates.
While this development provides some clarity, many questions still remain unanswered. The final ruling is not expected until mid-to-late spring 2024, leaving the real estate industry in a state of uncertainty. It is also unknown whether the Department of Justice will intervene in the Sitzer/Burnett suit, as it has done in the Nosalek lawsuit. Analysts and observers anticipate the involvement of the Department of Justice at some point.
In the meantime, the real estate industry continues to face challenges, with copycat lawsuits mounting and the industry awaiting a final resolution. The
In conclusion, the recent news about the preliminary approval of settlement agreements for RE/MAX and Anywhere Real Estate brings a sense of relief to both brokerages. The