Court issues opinion on DOJ lawsuit against NAR

WASHINGTON – Nov. 29, 2006 – A judge rejected a National Association of Realtors® (NAR) motion to dismiss the Department of Justice (DOJ) lawsuit against its Internet use policy, and on Monday issued a 29-page report explaining why he ruled that the case should continue.

The current move to dismiss favored DOJ because, according to the ruling, the “courts must accept as true all material allegations of the complaint, and must construe the complaint in favor of the complaining party.”

Consequently, NAR considered its request to dismiss the case a long shot, but one worth pursuing. And NAR General Counsel Laurie Janik says that there’s nothing surprising in U.S. District court Judge Mark Filip’s report, noting that he was “careful in his wording” and that the report did not say anything significant about the case.

The DOJ complaint, NAR’s response and the judge’s comments delve deeply into technical legal issues, but the main point of contention focuses on NAR’s two Internet-display policies for property listings. The original VOW policy (Virtual Office Web site) was pulled at the time DOJ filed its complaint, and was replaced by the ILD (Internet Listing Display) policy that is now on hold pending the results of the DOJ case. The DOJ generally views both policies as NAR attempts to limit competition, creating an antitrust issue.

NAR disagrees, saying the VOW policy no longer exists and the ILD is an unbiased set of rules to govern the use of brokers’ listings.

NAR wanted the VOW policy removed from the lawsuit because it no longer exists. The DOJ, however, claims that the VOW and then the ILD policy are “part of a continuing conspiracy among NAR and its member brokers to restrain competition.” Filip’s report calls this DOJ opinion “not implausible” because NAR “changed its policy (VOW) under immediate threat of suit and the United States has pleaded that the allegedly illicit motivation behind the initial VOW Policy also motivated” the ILD policy.

DOJ also alleges that the VOW policy still affects competition even though it’s no longer used, claiming that some Internet companies were forced out of business while the VOW policy was in effect. The judge’s report says this allegation is “sufficient to establish continuing alleged adverse effects.”

The complete report issued by the court can be downloaded in PDF format at http://www.usdoj.gov/atr/cases/f219800/219889.pdf

© 2006 FLORIDA ASSOCIATION OF REALTORS®

Questions, comments or suggestions on this article? Have a news tip? Send a letter to the editor to: Newseditor@floridarealtors.org.