Three of the largest MLSs in the country agreed to a settlement in one of the largest and highest-stakes lawsuits that specifically targeted MLS rules and practices, according to a court filing yesterday.
ThePLS.com v. National Association of REALTORS® et al was originally filed way back in 2020 by a pocket listing service startup, accusing the National Association of REALTORS® (NAR) and big MLSs of conspiring on rules that hindered competition. While touching on similar issues, the suit differs in several important ways from the cascade of Burnett copy-cat class actions filed in recent months.
The settlement agreement, according to a court filing yesterday, only includes the three MLSs named in the lawsuit—CRMLS in California, Bright MLS on the Atlantic coast, and Midwest Real Estate Data, or MRED, which serves the Chicago region. NAR, the only other defendant, has not settled the case, which is still ongoing.
Most notably, this lawsuit is not a class action, and is focused on “clear cooperation,” an NAR policy that requires agents to list properties on NAR-affiliated MLSs—something that is only an ancillary focus of the plaintiffs in Burnett and the copy-cats. Specifically, this suit claims that NAR conspired with the other defendants to monopolize listing services and stamp out competition through the policy, which was adopted in 2019.
Industry insiders have worried that this case—and a similar lawsuit filed by another listing service startup, known as TAN v. NAR—could upend real estate in even more fundamental ways than Burnett, directly targeting the relationship between NAR and the MLS industry.
Emails to representatives of Bright MLS, NAR and CRMLS were not immediately returned. A voicemail requesting comment left in the general mailbox for MRED was not immediately returned.
Emails sent to PLS.com attorneys were also not immediately returned.
ThePLS.com lawsuit was initially dismissed in 2021, but that decision was overturned on appeal and the case continued. The TAN suit was also dismissed, with a pending appeal before the Ninth Circuit.
Unlike PLS, TAN does not name any MLSs as defendants, instead targeting NAR and another local REALTOR® association.
A settlement by the MLSs—collectively representing close to 300,000 subscribers, with CRMLS and Bright being the first and second largest MLSs in the nation, respectively—would seem to indicate the MLS industry is taking a different approach to the lawsuits compared to NAR. Most of the commission class-action lawsuits, including Burnett, did not name any MLS as a defendant, though MLS practices, and the degree of influence NAR has on MLSs were key sticking points in the trial.
But because they weren’t defendants, the Burnett verdict did not have a direct effect on any MLSs, even the ones that plaintiffs named as “covered MLSs.” This case, however, has the potential to levy damages or force rule changes by the MLSs, specifically looking to nullify “clear cooperation.”
It was not immediately clear what the next steps were for the PLS.com suit. The filing refers to the agreement as a “settlement-in-principle,” and requested that the MLSs be excused from an upcoming conference before the court this Friday.
“The purpose of the request is to allow the settling parties to finalize the draft settlement agreement, to obtain necessary signatures, and to conserve judicial and party resources,” the filing claims.
This is a developing story. Check back with RISMedia for updates.