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A commission-related antitrust lawsuit against Hanna Holdings has now gone from one named homebuyer plaintiff to 26 — several of whom are familiar names.
Homebuyer Scott Davis filed the suit, which seeks class-action status, on May 31, alleging Hanna conspired with other members of the National Association of Realtors to inflate buyer agent commissions, leading to inflated home prices paid by buyers.
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While nationwide settlements have been announced in major commission cases brought by homesellers such as Sitzer | Burnett and Moehrl, none cover buyer claims.
Hanna Holdings touts itself as “the largest family-owned and -operated real estate brokerage in the United States,” and is the parent company of the brokerage Howard Hanna Real Estate Services.
Davis’s counsel, Korein Tillery and Lowey Dannenberg, also represent plaintiffs in three other buyer commission suits known as Batton 1, Batton 2 and Lutz, after their lead plaintiffs. In March, the Batton 2 plaintiffs dismissed Howard Hanna from their suit without prejudice, meaning the claims could be filed at a later time.
On Monday, the firms filed an amended complaint against Hanna, adding 25 other named plaintiffs to the suit, including James Lutz (the sole named plaintiff in Lutz) and Mya Batton, Do Yeon Irene Kim, Daniel Parsons, Anna James, Aaron Bolton, Theodore Bisbicos, and James Mullis (seven out of the eight named plaintiffs in Batton 1 and six of the seven named plaintiffs in Batton 2).
Additional new plaintiffs against Hanna are Niall Adams, Jason Boomsma, Thomas Braun, Sabrina Clark, Ryan Eisner, Steven Ewald, John Garrett, Brennon Groves, Darin Hendry, Jordan Kullmann, Joshua Putt, John Sannar, Robert Sayles, Ben Shadle, Brent Strine, Christine Van Woerkon and Sherrie Wohl.
It is unclear why the newly named plaintiffs have been added, though it may have something to do with a motion to dismiss Hanna filed on Aug. 5. In that motion, Hanna asked the U.S. District Court for the Eastern District of Pennsylvania to toss the case “with prejudice” (meaning permanently) or to transfer it to the Western District of Pennsylvania, where Howard Hanna is based.
Davis, a North Carolina resident, bought a home in Greensboro in 2022 using a buyer broker from Hanna Holdings subsidiary Allen Tate Real Estate. Hanna’s motion to dismiss argued that Davis’s agreement with Allen Tate included a mediation clause that required him to try to settle disputes through mediation before filing suit.
The motion also argued that Davis did not have the right to sue under most state and federal antitrust laws because he only resided and was allegedly injured in one state — North Carolina — and because he is a homebuyer rather than a homeseller and therefore an “indirect purchaser” of buyer broker services and ineligible to sue under federal antitrust law.
The newly named plaintiffs are all still buyers, but they come from 21 states and the nation’s capital: Maine, Tennessee, Massachusetts, Florida, Wisconsin, North Carolina, Iowa, Illinois, West Virginia, Maryland, Missouri, Colorado, Minnesota, Nevada, New Mexico, Arizona, Virginia, South Carolina, Oregon, Connecticut, New York and Washington, D.C.
Other than the new plaintiffs, the amended complaint is nearly identical to the original complaint. The complaint alleges Hanna Holdings violated federal and state antitrust laws by participating “in the establishment, maintenance, and implementation” of several NAR rules alleged to be anti-competitive, including the trade group’s cooperative compensation rule, also known as the Participation Rule, which, until recently, required listing brokers to make an offer of compensation to buyer brokers in order to submit a listing to a Realtor-affiliated multiple listing service.
The suit does not name any other defendants but does list several parties as co-conspirators of Hanna, including Anywhere (formerly, Realogy), RE/MAX, Keller Williams, HomeServices of America, Compass, eXp World Holdings, Redfin, Weichert Realtors, United Real Estate Group, Douglas Elliman, NAR, local Realtor associations, Realtor-affiliated MLSs, and franchisees and brokers of Hanna Holdings.
“Defendant is jointly and severally liable for the acts of its coconspirators, whether named or not named as defendants in this Complaint,” the filing says.
The complaint notes that plaintiff’s counsel, Korein Tillery and Lowey Dannenberg, have “brought suit against these co-conspirators … in related litigations.” Those suits were filed in different venues, however. The Lutz suit was filed in the U.S. District Court for the Southern District of Florida while Batton 1 and 2 were filed in U.S. District Court for the Northern District of Illinois Eastern Division.
The Davis complaint seeks to represent two classes:
- “Nationwide Class: All persons who, since December 1, 1996, through the present, purchased in the United States residential real estate that was listed on a NAR MLS.
- Damages Class: All persons who, since December 1, 1996, through the present, purchased in the Indirect Purchaser States residential real estate that was listed on a NAR MLS.”
“Indirect purchaser states” refers to states that allow indirect purchasers — such as buyers who allegedly pay for buyer agents through commissions paid by sellers — to recover damages under their own antitrust laws. The amended complaint names 25 such states.
The complaint alleges violation of the federal Sherman Antitrust Act on behalf of the nationwide class, which is asking not for damages but for an order declaring that Hanna Holdings’ actions violated the law.
The complaint also alleges unjust enrichment and violation of state antitrust and consumer protection statutes on behalf of the damages class. The plaintiffs are asking the court for a jury trial and seek damages and/or restitution for the damages class, costs of the suit for the plaintiff, and a permanent injunction stopping Hanna Holdings “from establishing the same or similar rules, policies, or practices as those challenged in this action in the future.”
Inman has reached out to Hanna Holdings and to plaintiffs’ attorney George A. Zelcs of Korein Tillery for comment. We will update this story if and when responses are received.
Read the amended complaint (re-load page if having trouble seeing document):
Email Andrea V. Brambila.
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