Supreme Court Declines to Hear Realtors’ Appeal, DOJ Antitrust Probe Moves Forward

In a setback for the National Association of Realtors (NAR), the U.S. Supreme Court has declined to hear an appeal from the powerful real estate trade group, effectively allowing the Department of Justice (DOJ) to resume its antitrust investigation into the organization’s policies. The Supreme Court’s decision, released as part of a routine list of orders on Monday, came without comment, leaving in place a lower court ruling that permits the probe to proceed.

The case stems from a November 2020 settlement between the NAR and the Trump administration’s DOJ, which the group argued should shield it from further investigation. According to Bloomberg, NAR contended that the agreement was binding and precluded any future inquiries by the federal government into its practices. However, the Biden administration withdrew from the settlement in 2021 before it had been finalized and sought to renew its investigation into the group’s policies around broker commissions and competition.

The real estate association, which represents more than 1.5 million agents across the country, took legal action to block the DOJ’s renewed efforts. A federal district court initially sided with NAR, barring the DOJ from issuing an investigative demand for information. However, a federal appeals court overturned that ruling on a 2-1 vote, paving the way for the antitrust probe to continue. Per Bloomberg, that decision now stands following the Supreme Court’s refusal to intervene.

Read more: NAR Seeks Dismissal of Pennsylvania Antitrust Lawsuit Filed by Broker

At the heart of the matter is the 2020 settlement, which imposed new requirements on the NAR aimed at increasing transparency around agent commissions and fostering greater competition among brokers. As part of the agreement, the DOJ had closed its investigation into two of the trade group’s policies. However, in mid-2021, the Biden administration opted to abandon the settlement and revisit some of NAR’s other practices through a formal demand for additional information.

With the Supreme Court’s decision not to take up the case, the Justice Department now has a limited window to escalate its investigation before the next presidential administration takes office. While President Joe Biden is currently seeking re-election, former President Donald Trump is among the leading Republican candidates for the 2024 race. Should Trump win a second term, his administration could potentially halt or reverse any legal action taken by the DOJ against NAR.

The case, formally titled National Association of Realtors v. United States, has garnered significant attention in the real estate industry, given its potential to reshape longstanding practices around how agents disclose and negotiate commission rates.

Source: Bloomberg