Real Estate Professionals in California Hit with New Lawsuit Alleging Collusion and Inflated Commissions

SACRAMENTO, California – Real estate professionals in California are facing yet another commission lawsuit. On Thursday, Willsim Latham, LLC. filed a lawsuit in U.S. District Court in Sacramento, alleging collusion among real estate industry players to artificially inflate real estate agent commissions.

The lawsuit targets MetroList Services, the area’s Multiple Listing Service (MLS), as well as various local Realtor associations and brokerages including RE/MAX, Anywhere, Keller Williams, eXp World Holdings, NorCal Gold, Williams L. Lyon & Associates, Guide Real Estate, Paul M. Zagaris Real Estate, and Century 21 Select Real Estate franchise.

MetroList, unlike other MLSs, is not exclusively owned or operated by Realtor associations affiliated with the National Association of Realtors (NAR). Instead, it is owned and operated by local Realtor associations and California Real Estate Brokers, Inc.

The lawsuit alleges that MetroList adopted a rule similar to NAR’s Participation Rule, which requires listing agents to offer compensation to buyers’ brokers in order to list a property on the MLS. The complaint states that by adopting this rule, the defendants participated in a conspiracy to restrain trade and artificially inflate commissions.

The lawsuit seeks class action status for all individuals in the U.S. who paid a buyer broker commission in connection with the sale of residential real estate listed on MetroList MLS between Jan. 18, 2020, and the present. The plaintiffs are demanding a jury trial, damages, and a permanent injunction preventing sellers from paying the buyer broker.

Both eXp and Keller Williams are facing multiple similar commission lawsuits. In response, eXp stated that it has been monitoring the situation and is confident in its ability to defend itself. Keller Williams, which was found liable for colluding in a previous trial, is focused on post-trial motions in that case.

RE/MAX, Anywhere, and Century 21 Select Real Estate are part of settlement agreements in previous commission lawsuits. The other defendants in the current suit did not provide comments.

The lawsuit highlights the ongoing scrutiny of real estate industry practices, particularly regarding commission structures. The outcome of these cases could potentially impact how real estate professionals conduct business and negotiate commissions moving forward in California.