Judge approves commissions settlements for Anywhere, RE/MAX, KW
Despite a last-minute motion to delay the hearing, the proceedings went on as scheduled, ending buyer agent commissions litigation for the three brokerages.
Key points:
- The combined damages from the three settlements total $208.5 million.
- Final approval was granted despite objections from homebuilder Pulte and plaintiffs in the Batton cases.
- The settlements for NAR and seven additional brokerage firms are still awaiting final approval, with some scheduled for approval by late November.
A Missouri judge has given final approval to three settlements totaling $208.5 million in the buyer agent commissions lawsuits, marking the end of a years-long litigation process for Anywhere Real Estate, Keller Williams and RE/MAX.
In a hearing that lasted less than an hour, U.S. District Court Judge Stephen Bough approved the multimillion-dollar deals. Michael Ketchmark, lead attorney for the plaintiffs, confirmed all three settlements in a text message.
"What this means moving forward is these cases are resolved against those defendants and the practice changes are going to go into effect eliminating the requirement that home sellers pay buyers commissions," Ketchmark said.
Anywhere and RE/MAX were the first two companies to reach a settlement agreement with home sellers in Missouri, ahead of the Sitzer/Burnett trial, while Keller Williams announced its settlement three months after the jury reached its Oct. 31 verdict.
Darryl Frost, spokesperson for Keller Williams, said the company was satisfied with the outcome of the hearing. KW's settlement included $70 million in damages and changes to the firm's commissions practices.
"We will continue to focus on what we do best: Empowering real estate entrepreneurs so they can deliver exceptional value to their clients," Frost said.
In a company statement, RE/MAX was also pleased with the result, which releases all U.S. RE/MAX brokers/owners and affiliates from further litigation in the case.
"We are thrilled to be moving forward, maintaining our focus on supporting RE/MAX affiliates and continuing to foster greater transparency in the industry on behalf of homebuyers and sellers," the company said in its statement.
Ryan Schneider, CEO and president of Anywhere, called the approval "a significant milestone," adding that with the claims behind them, the company can better focus on helping homebuyers and sellers.
Objections, and an attempted delay
Several groups had objected to the approval and were each given five minutes to speak at the hearing. That included PulteGroup, one of the largest homebuilders in the U.S. In April, Pulte filed a document with the court arguing that the settlement system was too onerous for companies that sold multiple homes and that it lacked clarity about the award amount.
Before it even began, the settlement hearing almost hit a snag as homebuyers made a last-minute attempt to delay the proceedings. Plaintiffs in the Batton case filed a motion for an injunction and temporary restraining order on May 8, claiming the settling defendants didn't reveal their intention to include homebuyers who had also sold a home in the terms of the settlement — something which would be damaging to the Batton class.
U.S. District Judge Andrea Wood denied the motion later in the day, telling the plaintiffs they would have the opportunity to challenge the settlements during the final approval hearing.
11 settlements and counting
With today's ruling, here is the status of brokerages and organizations that have announced settlements in the commissions cases:
Finalized:
Anywhere Real Estate: $83.5 million
Keller Williams: $70 million
RE/MAX: $55 million
Recently announced or preliminarily approved:
National Association of Realtors: $418 million
HomeServices of America: $250 million
Compass: $57.5 million
Real Brokerage: $9.25 million
Realty ONE: Damage total not announced yet
@properties: Damage total not announced yet
Douglas Elliman: Up to $17.75 million
Redfin: $9.25 million
The National Association of Realtors, which announced its settlement on March 15, is scheduled to have a final approval hearing in November.
Five brokerages which announced settlement deals in March or April — Compass, Real Brokerage, Realty ONE Group, At World Properties and Douglas Elliman — will need to schedule a final approval hearing no later than Nov. 26.