DOJ to sue NAR for antitrust

May 9, 2005

Federal agency eyes group's policy for online listings display

Inman News

The U.S. Justice Department is preparing to sue the National Association of Realtors over policies the federal agency believes will illegally restrict competition and harm online competitors, the Wall Street Journal reported today.

The Justice Department is expected to charge that NAR, in its pending bylaw governing virtual office Web sites, illegally adopted policies that aim to restrict Internet-based competition and discount brokers, according to the Wall Street Journal report, which cites lawyers close to the case.

The NAR rule, which is expected to take effect in July, would enable broker members to withhold property listings from online brokers. The date of implementation for the rule has been delayed several times since the association first adopted in nearly two years ago.

NAR is the largest trade association for real estate companies and agents, and has more than 1 million members.

In May 2003, NAR adopted a policy to govern how brokers could display each other's for-sale listings on virtual office Web sites, or VOWs.

The Justice Department's investigation of the policy, which opened in late 2003, has focused on a provision of NAR's policy that permits brokers to opt out listings from other brokers' VOWs on a blanket or selective basis, according to NAR's legal department. The Department also has been interested in a provision that restricts the use of names and contact information collected through a VOW in connection with referrals of business to companies other than real estate brokers.

VOWs are an easy way for brokers to display for-sale listings online, and some companies are using the technology to gather buyer leads on the Web. But some brokers strongly oppose their listings being displayed on their competitors' Web sites.

The DOJ's efforts aim to protect home buyers and sellers and could help contain high real estate costs, according to the WSJ report.

Copyright 2005 Inman News

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