Filing follows recent $1.78 billion Missouri verdict based on similar claims

Two North Texas home sellers have filed a proposed class action lawsuit alleging an unlawful conspiracy between residential real estate companies and related associations in the state to inflate commissions and artificially drive up home prices for buyers. The proposed class is represented by The Pettit Law Firm in Dallas and co-counsel firms Lynn Pinker Hurst & Schwegmann and Kaplan Fox & Kilsheimer.

The lawsuit, filed under the Sherman Antitrust Act as well as the Texas Deceptive Trade Practices Act in federal court, names the Texas Association of Realtors and local realty boards in Austin, Dallas-Fort Worth, Houston and San Antonio as defendants. Also named among the more than 30 defendants are some of the state’s largest residential realty companies, including Ebby Halliday Real Estate, the Dave Perry-Miller Company and Keller Williams Realty.

According to the filing, restricting access to the Multiple Listing Service database of available homes results in an anticompetitive and inflated commission to the broker representing home sellers, a practice that violates federal antitrust regulations. This control over local real estate markets extends to an industry-recognized practice known as “steering,” in which homeowners are pressured into accepting inflated commission rates out of fear that otherwise their homes will not be effectively marketed to prospective buyers.

“The commission structure in Texas forces home sellers to pay the agents for both the buyer and the seller, enforces a single source for listings through MLS and creates a conspiracy of silence within the industry,” says Julie Pettit of The Pettit Law Firm in Dallas, representing the plaintiffs. “This corrupt system violates federal law and is frankly antiquated given the available technology and realities of buying a home today.”

The Texas lawsuit comes in the wake of a $1.78 billion verdict handed down by a jury in Missouri federal court in late October. That award would return financial damages to the sellers of more than 260,000 homes in Missouri, Kansas and Illinois.

Published reports indicate the average 6% commission in Texas is among the highest in the nation, and that Americans pay more than $100 billion in residential real estate commissions annually. According to the lawsuit, the U.S. Department of Justice is also investigating the residential real estate brokerage sector, with a focus on broker commissions and related practices.

In addition to The Pettit Law Firm, the plaintiffs in the proposed class action are represented by Michael K. Hurst of Lynn Pinker Hurst & Schwegmann and Laurence D. King, Frederic S. Fox, Jeffrey P. Campisi and Matthew P. McCahill of Kaplan Fox & Kilsheimer.

The case is captioned QJ Team LLC and Five Points Holdings LLC v. Texas Association of Realtors Inc. et al, No. 4:23-cv-01013, and was filed in the U.S. District Court for the Eastern District of Texas in Sherman.

If you would like a copy of the complaint or have questions about the lawsuit, your rights or interests, the lawyers representing the sellers and the proposed class can be contacted by phone, email, or by visiting their websites, and Ms. Pettit can be contacted at jpettit@pettitfirm.com.

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