NAR’s Clear Cooperation Policy Wins First Court Case
A federal judge dismissed the case, saying NAR’s Clear Cooperation Policy, which limits pocket listings, isn’t an antitrust issue. PLS.com, a pocket-listing service, alleges that NAR designed a stricter pocket-listing policy to damage its business model and discourage listings.
CHICAGO – A federal district judge granted motions by the National Association of Realtors® (NAR) and three MLSs to dismiss an antitrust case brought by PLS.com LLC, a private listing service network based in California. The case is The PLS.com, LLC v. The National Association of Realtors et al.
PLS alleged that the NAR’s Clear Cooperation Policy violated federal antitrust law by discouraging listings on its service, which focused on pocket listings. However, the judge ruling in the case, Judge John W. Holcomb of the U.S. District Court for the Central District of California, said in his case ruling that antitrust laws were enacted to protect competition, not competitors. Holcomb said that PLS failed to allege any plausible facts showing consumers were harmed.
The Clear Cooperation policy requires listing brokers who participate in a multiple listing service (MLS) to submit a new listing to the MLS within one business day of marketing the property to the public. NAR’s board of directors approved the policy in November 2019, and NAR-affiliated MLSs were required to implement the policy by May 1, 2020.
NAR’s MLS Technology and Emerging Issues Advisory Board first proposed the policy as a way to address the growing use of off-MLS listings, sometimes known as pocket listings. The advisory board decided that pocket listings outside the broader marketplace excluded consumers and undermined Realtors’ commitment to providing equal opportunity to all. The policy doesn’t prohibit brokers from taking office-exclusive listings.
“On its face, the Clear Cooperation Policy does not preclude real estate professionals from offering pocket listing services, nor does it preclude them from marketing their listings on PLS,” the court said in dismissing the case. “Furthermore, there is no plausible inference from the alleged facts that the Clear Cooperation Policy has any such restrictive effect on the output of brokerage services to consumers.”
In fact, the court said, Clear Cooperation “has some plainly pro-competitive aspects, which underscore that PLS cannot allege a plausible connection between harm to its business and harm to competition and consumers.”
“This outcome further emphasizes that the MLS system creates competitive, efficient markets that benefit homebuyers and sellers alike,” adds Katie Johnson, NAR General Counsel. “Cooperation among brokers via the MLS ensures the greatest availability to accurate property information for all consumers.”
NAR is fighting a similar lawsuit in California, filed by Top Agent Network. “This suit is ongoing,” Johnson says, “and we’re confident we’ll prevail again.”
Source: National Association of Realtors® (NAR)
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