Home brokerages Compass, Redfin and others must face buyers’ price-fixing lawsuit

By Mike Scarcella

WASHINGTON, March 25 (Reuters) - Major U.S. home real estate brokerages Compass COMP.N, eXp EXPI.O, Redfin and two others must face a lawsuit by buyers accusing them of conspiring to fix commissions and inflate home prices, a federal judge ruled on Tuesday.

In her order, U.S. District Judge LaShonda Hunt in Chicago allowed most of the claims brought by 32 homebuyers to proceed against the brokerages, which also include Weichert Realtors, and United Real Estate Group.

The plaintiffs, seeking to represent at least thousands of home buyers in a class action, contend that sellers are inflating home prices to offset the cost of commissions that the defendants require buyers to pay their agents, driving up the overall cost of buying a home.

Redfin in a statement said its goal is to save consumers in real estate fees and "there is a complete disconnect between our business model and the plaintiffs’ senseless claims in this case."

Compass, eXp, Weichert and United Real Estate did not immediately respond to requests for comment. The companies have denied any wrongdoing.

Lead attorneys for the buyers also did not immediately respond to requests for comment.

Hunt found the plaintiffs had plausibly alleged the companies were conspiring on commission requirements and were not independently following industry rules.

She also dismissed or trimmed some antitrust claims under the laws of Florida, Missouri, Tennessee and other states.

In February, U.S. real estate brokerage Keller Williams agreed to pay $20 million to settle claims against it in the lawsuit. Keller Williams, which markets itself as the largest real estate franchise by agent count, also said it would cooperate with the buyers.

The National Association of Realtors and some major brokerages have been hit with separate antitrust lawsuits by home sellers claiming damages in connection with commission fees. Many of those cases have resulted in settlements totaling hundreds of millions of dollars. The trade association denied any wrongdoing in that settlement.

The case is Mya Batton et al v. Compass et al, U.S. District Court for the Northern District of Illinois, No. 1:23-cv-15618.

For plaintiffs: George Zelcs and Randall Ewing Jr of Korein Tillery, and Vincent Briganti of Lowey Dannenberg

For Compass: Chahira Solh and Sima Namiri-Kalantari of Crowell & Moring

For eXp: James Morsch and Francis Riley III of Saul Ewing

For Redfin: Gerald Stein and Robert Maguire of Davis Wright Tremaine

For Weichert: Dylan Ballard and Adam Hudes of Vinson & Elkins

For United Real Estate: James Lawrence and Lindsay Sklar Johnson of Bryan Cave Leighton Paisner

Read more:

Compass dismisses lawsuit against Zillow after 'Zillow ban' ends

Home brokerage Keller Williams to settle homebuyer class action for $20 million