A Clear Victory for Cooperation
February 4, 2021
A federal district judge yesterday granted motions by the National Association of REALTORS® and three MLSs to dismiss an antitrust case brought by PLS.com LLC, a private listing network based in California.
PLS alleged that the association’s Clear Cooperation Policy violated federal antitrust law by discouraging listings on its service. In ruling against PLS, Judge John W. Holcomb of the U.S. District Court for the Central District of California, said that antitrust laws were enacted to protect competition, not competitors, and that PLS failed to allege any plausible facts that consumers were harmed.
Clear Cooperation requires listing brokers who are participants in a multiple listing service to submit their listing to the MLS within one business day of marketing the property to the public. The policy was approved by NAR’s board of directors 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 proposed the policy as a way to address the growing use of off-MLS listings, sometimes known as pocket listings. The advisory board concluded that leaving listings outside of the broader marketplace excludes consumers, undermining REALTORS®’ commitment to providing equal opportunity to all. The policy doesn’t prohibit brokers from taking office-exclusive listings. (See “NAR Passes Proposal to Strengthen Cooperation,” Nov. 11, 2019.)
“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 PLS 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 home buyers and sellers alike,” says 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.”