Maurice Muhammad accuses the “autonomy” of NAR, the regional Realtor association and the local MLS that restricts competition, raises prices, and unfairly affects minority sellers and agents.
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A Pennsylvania real estate agent is suing the National Association of Realtors, the state Realtor association and his multiple listing service for $5.6 million over the requirement that he be a Realtor to access the MLS.
On October 16, Maurice Muhammad, the broker of record for Progressive Realty in Allentown, filed a lawsuit against NAR, the Pennsylvania Association of Realtors and the Greater Lehigh Valley MLS (GLVMLS) for “violations of federal human rights laws, practices of unlawful discrimination, violation of federal antitrust laws, breach of contract, and creating a monopoly system that compels membership.”
Muhammad filed the lawsuit “pro se,” meaning he is acting on his own, in the US District Court for the Eastern District of Pennsylvania.
“The mandatory membership requirement imposed by NAR, PAR, and GLVMLS creates an oppressive situation that disproportionately affects a minority of professionals who cannot afford the mandatory membership fees,” the complaint states.
“Defendants have used their power over MLS services to prevent the establishment of other trade associations, thereby preventing competition and strengthening their control over the real estate industry.”
Maurice Muhammad
Muhammad is not the only seller to object to the requirement that many MLSs have that they join the NAR in order to access the MLS. In August, two Michigan real estate agents and an agent filed a class-action antitrust lawsuit against the NAR, their state and local Realtor associations, and the state’s largest MLS, Realcomp II, challenging the requirement.
Muhammad’s complaint also alleges that NAR, PAR and GLVMLS discriminate against minority real estate professionals through “selective application of rules, disproportionate use of disciplinary measures, and exclusion of minority professionals from leadership positions.”
“Defendants require real estate professionals to join NAR, PAR, and GLVMLS in order to conduct business, even though many minority members receive little benefit from such membership and face discrimination within these organizations,” the complaint added.
Because many leadership positions in trade groups are filled by “non-minorities,” the complaint says trade group policies and rules “do not address the unique challenges faced by minority professionals” and the concerns raised by Muhammad and others. minority members “have been ignored by the Defendants, perpetuating a system of exclusion and discrimination.”
The complaint does not provide the specifics of this alleged discrimination, which Muhammad says he personally experienced, or the concerns raised by minority members. Reference is made to a “Community Legal Services of Lehigh Valley (CLCV) report” that allegedly “revealed systematic bias in how multi-professional real estate transactions and clients are handled,” but the report was not included in the complaint.
Inman requested this information from Muhammad and will update this story if a response is received.
The suit alleges civil rights violations, breach of contract, due process violations under the US Constitution, and antitrust violations under the Sherman Act and Clayton Act.
“Defendants violated federal antitrust laws, including the Sherman Act and the Clayton Act, by maintaining a monopoly over MLS services and forcing real estate professionals into mandatory membership with NAR, PAR, and GLVMLS, thereby they prevent illegal trade,” the complaint said.
“These practices have limited competition, high prices, and prevented the emergence of other MLS providers, all of which hurt both professionals and consumers.”
The complaint seeks a trial and asks the court to issue a permanent injunction requiring the trade groups to change their procedures to “ensure equal treatment of all members and eliminate mandatory membership requirements,” to authorize trade groups to conduct “alternative MLS Programs” that do not require membership in the NAR , PAR or GLVMLS, for an order requiring trade groups to restructure their jurisdiction to represent the majority, punitive damages and compensatory damages of “not less than $5,600,000,” among other things. .
GLVMLS declined to comment on the matter, citing counsel’s advice. PAR also declined to comment, citing pending cases.
Inman has reached out to NAR and will add any comments to this story if and when a response is received.
Read the complaint (reload the page if the document is not visible):
Email Andrea V. Brambila.
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