The Department of Justice (DOJ), through its Antitrust Division, initiated an investigation into NAR’s policies, which culminated in a settlement in November 2020. This settlement aimed to address four out of six policies identified by the DOJ as potentially anticompetitive. Crucially, it also included the issuance of a closing letter by the DOJ, indicating the closure of its investigation into two key NAR policies: the “Clear Cooperation Policy” and the “Participation Rule.” These policies relate to the operation of multiple-listing services (MLSs) and the commission structure within real estate transactions, respectively.
However, in a dramatic shift, the DOJ reopened its investigation into these policies in July 2021, leading to a legal challenge by NAR. NAR argued that the DOJ’s action breached the settlement agreement, which, in their view, included an implicit assurance against reopening the investigation into the specified policies.
The Appeals Court, in its decision, highlighted the legal nuances of the settlement agreement and the scope of the DOJ’s commitments. The court concluded that the settlement did not preclude the DOJ from reopening its investigation. This decision not only emphasizes the DOJ’s ongoing authority to regulate and scrutinize industry practices for anticompetitive behavior but also signals to real estate professionals the importance of adaptive compliance with evolving regulatory landscapes.
This ruling carries profound implications for the real estate industry, reinforcing the principle that regulatory oversight is a dynamic process, subject to revision and reassessment in light of new information or changing circumstances. For homebuyers and homesellers, the decision underscores the government’s commitment to ensuring fair and competitive practices within the real estate market, aiming to protect consumer interests and promote market transparency.
United States Court of Appeals Judgement – NAR vs United States of America
(click on image below to access entire judgment)
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