New York-based OneKey MLS joined California Regional Multiple Listing Service (CRMLS) as a plaintiff in its federal lawsuit against Compass Tuesday, with the MLSs filing an amended complaint in Manhattan federal court asking a federal judge to declare their “clear cooperation” rules lawful. The complaint escalates the MLSs’ legal fight with Compass, the nation’s largest real estate brokerage.
According to the complaint filed with the Southern District of New York, Compass sued CRMLS in federal court in California on Oct. 16, after the MLS preemptively sued the brokerage in New York earlier this month. The MLSs want an injunction barring Compass from suing over their listing rules, in addition to a declaration affirming that their listing rules are not anticompetitive.
The latest filing includes an email chain spanning several months between Compass CEO Robert Reffkin and OneKey CEO Richard Haggerty.
In those emails, Reffkin threatened to take the MLS to court months before sending a demand letter in September over the MLSs’ “clear cooperation” rule. The rule requires that listings be submitted to the MLS within one business day of public marketing under an exclusive agreement. Meanwhile, he also said Compass “deeply values” the MLS.
“It’s almost as if CRMLS and One(Key) MLS are asking people to ignore the evidence that proves their claims aren’t true,” a Compass International Holdings spokesperson told RISMedia. “For years, 7 of the top 25 MLSs, covering 340,000 agents across 12 states, have allowed agents to publicly market ‘office exclusives’ without fines, and none of the problems they warn about have happened. If what we are asking for is so bad, why has it worked for years in nearly 30% of the country?”
Compass sued CRMLS on Oct. 16, making good on public threats to haul MLSs into court that fined its agents for marketing listings outside of the listing service. In a March 21 email to Haggerty, Reffkin called the MLS an “unregulated monopoly” and said membership is a “requirement of trade.”
Reffkin also argued that agents have a fiduciary duty to follow sellers’ instructions, so MLS fines force them to choose between the law and their sellers’ wishes. He wrote that Compass was “on a clear path” to treble damages and that “litigation is likely to start next month.”
The brokerage argues that the fines violate antitrust laws and restrain competition. However, CRMLS and OneKey assert they offer sellers multiple options
In one of the emails, Reffkin asked OneKey to adopt the policies of other MLSs, such as removing days-on-market and price history from listings, removing limits on Coming Soon periods and decoupling cooperation with the MLS from feed distribution.
The plaintiffs say that Reffkin’s chain of emailed litigation threats, along with Compass’s Sept. 30 demand letter and eventual lawsuit filing, show a pattern of escalation, which they argue justifies their initial lawsuit filing.
Haggerty in a response email pushed back against Reffkin’s claims, noting that OneKey offers sellers several marketing options. He also made it clear that he preferred to use the governance process rather than email to discuss policies.
The amended complaint notes that sellers can still keep a home off the MLS through “no cooperation” or “office exclusive” listings, use non-exclusive agreements or indicate a Coming Soon status. The MLS rules prevent agents from publicly marketing a home on the MLS while simultaneously withholding it from the rest of the market in a private listing network.
“This case raises questions that extend far beyond any one company or market,” said Richard Haggerty, CEO of OneKey MLS in a statement released Tuesday. “It goes to the core of how homes for sale are shared, how everyday buyers access that information, and how we protect a fair, equal housing market for everyone. We believe these issues demand clarity from the court, and joining CRMLS gives OneKey a direct, active voice in securing it.”
“I’m looking forward to working alongside OneKey MLS in the fight to protect the open marketplace and keep real estate fair and transparent for brokers, agents, and consumers alike,” said Art Carter, CEO of CRMLS in the statement.
In the filing, the plaintiffs accuse Compass of wanting to “have its cake and eat it too.” The complaint also notes that a federal judge denied Compass’s bid for a preliminary injunction against Zillow in February (Compass later dropped the case), and noted the brokerage’s suit against Northwest MLS was settled with the submission requirement intact.
In a recent letter, a Compass lawyer asked a federal judge to move the CRMLS case to California, citing “clear ties” to the state. On Oct. 21, six more MLSs filed suit against Compass to block its lawsuits and affirm their rules.
This is a breaking story. Stay tuned to RISMedia for updates.
