Federal panel eyes combining broker commission lawsuits

Asbestos injuries, ear plug defects and broker commissions now have one thing in common: consideration by the Judicial Panel on Multidistrict Litigation. 

The federal panel, known as the MDL, is weighing whether to combine nearly half of the antitrust cases filed in recent months targeting national and local residential brokers, according to a motion filed earlier this month. 

If approved, nine of the lawsuits targeting brokerages and industry groups would head to a single district for pre-trial discovery with just one judge supervising the process. The move is common when multiple class-action suits with similar claims are filed across several jurisdictions. 

Consolidating the cases “makes it easier for defendants because they can just do [discovery] once and get a ruling,” said antitrust attorney Dylan Carson. “It preserves some level of continuity and promotes efficiency for everyone.”

The move can also reduce litigation costs and speed up the process, according to Carson. Once the discovery phase is complete, and if a settlement isn’t already reached, the cases can return to their original jurisdiction for trial. 

The MDL’s consideration comes as the National Association of Realtors and two major brokerages are facing potentially $5 billion in damages after a jury ruled against them in the Sitzer/Burnett trial and as copycat litigation continues to stack up across the country. 

“It’s a great idea for the efficiency of the litigation,” said Michael Ketchmark, an attorney for the plaintiffs in the lawsuit known as Gibson. The lawsuit, which counts Compass, Douglas Elliman and Redfin among the defendants, is seeking over $200 billion in damages. 

Ketchmark filed a brief in support of the motion and said he’s working on drumming up support from the attorneys involved in other cases — a process he described as “trying to herd a pack of cats.”

If approved, the MDL would transfer the cases to the Western District of Missouri, the same district as Gibson and its predecessor, Sitzer/Burnett. 

Other attorneys were hesitant to endorse the move. Jonathan Palmer, who represents the plaintiffs in a North Georgia lawsuit, said he doesn’t know whether his team will support the transfer. 

Bruce Fox, an attorney for the plaintiffs in a Western Pennsylvania lawsuit, said he didn’t think consolidation was appropriate for all of the cases included in the motion. 

“It’s our position that the case should remain in [Pennsylvania],” Fox said. 

He added that most of the discovery in the lawsuit will likely focus specifically on activity and players in the state. 

“The claims are distinct,” he said. 

A spokesperson for NAR said the organization would respond to the filing at the appropriate time. Responses are due by Jan. 26. 

To make its decision, the panel will have to determine whether the facts in each case are common enough to warrant consolidation. It could choose to combine and transfer some and exclude others. 

Among the other lawsuits named in the motion is the Monty March case in the Southern District of New York, which includes the Real Estate Board of New York and 26 other residential firms as defendants. Two Texas-based lawsuits, one in California and another in South Carolina are also included in the motion. 

Read more

National

New scandal, same problems: NAR’s latest shakeup

Texas

Who’s behind the Texas lawsuit over broker commissions?

National

Meet the lawyer who crushed the brokerage industry