In the face of a copycat commission lawsuit, the Real Estate Board of New York has vowed to fight. In an email blast sent to REBNY members, the New York City real estate agent trade group said it would “vigorously defend the litigation.”
Originally filed in early November, the commission lawsuit known as the March suit, after its lead plaintiff, takes aim at a REBNY Listing Service rule called the Buyer Broker Commission Rule, which states that the brokers “shall each be paid an equal share of the commission as specified in the Exclusive Listing.” The complaint alleges that due to this rule, home sellers in Manhattan paid inflated broker commissions.
In addition to REBNY, the lawsuit names 25 brokerages, including Christie’s International Real Estate, Coldwell Banker, Compass, The Corcoran Group , Douglas Elliman, Elegran, Engel & Volkers, Homesnap, Keller Williams NYC , The Agency, Nest Seekers International, RE/MAX, SERHANT., Sloane Square, and Sotheby’s International Realty Affiliates.
In its email, REBNY said that complaint is “laden with numerous inaccuracies regarding the RLS, the Universal Co-Brokerage Agreement, and the business of real estate.”
The group reassured members that the lawsuit is not currently impacting the agent’s day-to-day work.
“You can continue to use the RLS, rely on the UCBA, engage clients, and transact business as you normally would,” the email read. “The work you do as agents and brokers moves New York City forward. REBNY remains deeply committed to supporting and protecting your work.”
In mid-October, REBNY announced changes to its rules, including a rule preventing listing agents from paying or offering to pay buyers’ agents compensation. Instead, if a seller wishes to compensate the buyer’s agent, they must pay the agent themselves. It is not required for a seller to compensate a buyer’s agent. The rule goes into effect on Jan. 1, 2024.
The March suit is just one of several copycat commission lawsuits that have been filed since the jury verdict in the Sitzer/Burnett suit in late October, which found the real estate industry liable for colluding to artificially inflate real estate agent commissions. In its email, REBNY claimed that the verdict in the Sitzer/Burnett suit and the damages awarded to the plaintiffs likely inspired this and some of the other copycat lawsuits.
