Plaintiffs in Batton, the largest commission-focused case filed by homebuyers, are seeking to delay approval of settlements that brokerages agreed to in cases filed by homesellers, according to a court filing today, claiming at least two companies are attempting to squeeze in immunity from buyer claims at the last minute.
With the final approval hearing scheduled for tomorrow, May 9, plaintiffs are asserting that RE/MAX and Keller Williams kept “clandestine” their intent to seek legal protection in cases that include people who both bought and sold at the same time—essentially excluding a huge swath of the potential buyer class.
“Only yesterday, Defendants revealed that they are actively seeking to enjoin Plaintiffs and the putative classes from pursuing their claims in this Court,” wrote the plaintiffs. “The fairness hearing for the Settlements at issue is in one day. Accordingly, an immediate injunction is necessary.”
The last-minute drama comes as brokerages hope to put at least one major chapter of the commission lawsuits behind them. Final approval of the settlements would ostensibly provide assurance against any other major financial blows or court-ordered practice changes—though the Department of Justice (DOJ) could also still intervene, and has the power to push for more regulation of real estate outside the bounds of the commission lawsuits.
Sources familiar with negotiations of the National Association of REALTORS® (NAR) settlement previously told RISMedia that the organization’s settlement did not cover buyer claims, though NAR’s settlement is very different in many ways from agreements struck by brokerages in these same lawsuits.
A representative from Keller Williams declined to comment on the filing. A spokesperson for RE/MAX said the company “has been committed to final approval” since first agreeing to the settlement in September of last year.
“We are hopeful that final approval is granted and we can move forward with full focus on supporting our affiliates and continuing to foster greater transparency in the industry,” the spokesperson said.
According to the Batton plaintiffs, the attempt to exclude members of the potential buyer class constitutes a circumvention of normal court procedure. They also claim that RE/MAX and Keller Williams had plenty of opportunities to make it clear that they would be seeking this broader immunity in the seller cases, but failed to disclose it—even when asked directly by plaintiffs in Batton.
Additionally, the settlement agreements themselves do not indicate that they offer immunity from buyer claims, according to the Batton plaintiffs, and lawyers representing this potential class had no input in the seller agreements.
“Homebuyers’ claims are live claims being actively litigated before this Court. The Proposed Order’s injunction and release of these meritorious claims without regard…to procedural safeguards clearly constitute irreparable harm,” they wrote.
The Batton plaintiffs are seeking a temporary restraining order and preliminary injunction on the proposed settlement approval. The hearing for the final settlement approval, which is also expected to include other companies who have agreed to settlements in the seller suits, is currently scheduled to take place in-person tomorrow in Kansas City.
The judge had not ruled on the plaintiffs’ motion at press time.
Editor’s note: this story was updated at 1:03 p.m. eastern with responses from Keller Williams and RE/MAX.
The whole case should have been thrown out. Sellers hire Brokers to sell their homes. The Brokers model of compensating, cooperating, staging and such is that firm’s business model. Commissions and fees have been negotiable all along in part due to compensation and also the cost of doing business. Are the attorneys handling this doing it on a commission basis? How much does attorney charge on an hourly basis and is that negotiable?
Absolutely.
Good Point and agree totally
Thank you
Totally agree