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Keller Williams Settles Agent Commission Lawsuits for $70 Million

Keller Williams Settles Agent Commission Lawsuits for $70 Million

One of the nation’s largest real estate brokerages, Keller Williams Realty Inc., has proposed a settlement to resolve over a dozen lawsuits nationwide concerning agent commissions, agreeing to pay $70 million. The agreement, filed in federal courts overseeing cases in Illinois and Missouri, focuses on enhancing transparency regarding commissions for homebuyers and sellers, aiming to address claims that major real estate brokerages engage in practices leading to artificially inflated agent commissions during home sales.

Michael Ketchmark, an attorney representing the plaintiffs, sees the proposed settlement as a significant victory for homeowners and homebuyers, providing relief and stability for Keller Williams amid ongoing litigation. In October, a Missouri federal jury found that the National Association of Realtors and several major brokerages, including Keller Williams, conspired to require home sellers to pay homebuyers’ agent commissions in violation of antitrust laws, resulting in a $1.8 billion damages order, potentially rising to over $5 billion with treble damages.

To remove Keller Williams from the litigation and offer nationwide release from similar agent commission lawsuits, the company, based in Austin, Texas, has taken steps toward the proposed settlement. Among the terms, Keller Williams commits to making clear to clients that commissions are negotiable, dispelling any set minimum payment requirement, and ensuring disclosure of compensation structures for agents working with prospective homebuyers. Additionally, Keller Williams agents may no longer be obligated to be members of the National Association of Realtors or follow its guidelines, subject to court approval.

Last year, two other major real estate brokerages, Anywhere Real Estate Inc. and Re/Max, agreed to similar settlement terms, with Anywhere Real Estate Inc. agreeing to pay $83.5 million, and Re/Max agreeing to pay $55 million.

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