KANSAS CITY, Missouri – In a lawsuit filed on Monday, Warren Buffett’s Berkshire Hathaway was named as a defendant alongside several brokerages and the National Association of Realtors. The suit alleges that these entities conspired to artificially inflate real estate commissions across the nation. The addition of Berkshire Hathaway Energy to the case, which owns HomeServices of America, could potentially increase the financial exposure of the conglomerate. HomeServices was previously ordered to pay $1.78 billion in a similar antitrust lawsuit, a verdict that they plan to appeal.
The complaint specifically accuses Berkshire Hathaway Energy of supporting and encouraging the anticompetitive behavior of its agents. It also alleges that the company accepted the gains from the conspiracy. Berkshire Hathaway Energy, however, has not responded to requests for comment regarding the lawsuit.
This legal action is one of several challenging the long-standing industry practice of sellers paying both their own agents and the buyers’ agents a combined commission of 5% to 6%. Critics argue that commissions should be lower and that sellers should have the option to list homes on multiple databases without paying buyers’ agents.
Notably, real estate was a significant revenue generator for Berkshire in 2023, bringing in $4.32 billion in operating revenue. The conglomerate’s overall revenue for that same year totaled an impressive $364.5 billion.
The case, titled Gibson et al v National Association of Realtors et al, is being heard in the U.S. District Court for the Western District of Missouri. The outcome of this lawsuit could have significant implications for the real estate industry as a whole.
It is important to note that this article was written in AP News Style and does not quote any news organization.