Six MLSs Sue Compass to Defend Listing Cooperation Rules

What happened

Six MLSs filed a joint lawsuit against Compass on Oct. 21 in the U.S. District Court for the Southern District of New York: Arizona Regional Multiple Listing Service, BridgeMLS, Canopy MLS, Doorify MLS, Hive MLS and REcolorado. RealEstateNews.com reports that together they represent more than 120,000 real estate professionals.

The MLSs want the court to declare that their cooperation rules don't violate Section 1 of the Sherman Act or the antitrust laws of Arizona, California, Colorado and North Carolina. They also want an injunction that would permanently stop Compass from suing them over those rules. The suit answers demand letters Compass sent in September, which threatened to sue any MLS that fines agents for publicly marketing listings without submitting them to the MLS.

The complaint says Compass is "free riding" by using the shared database for its buyer clients while holding back its own listings. "If brokers could use the MLS database to find properties for their buyer-clients while simultaneously withholding their own listings, the database would become incomplete and lose its value," the lawsuit reads, according to RISMedia.

A Compass spokesperson replied that "only the law and the homeowner should tell agents how to publicly market a home, and these MLSs are neither the law nor the homeowner." The spokesperson also said MLSs serving more than 350,000 agents across 12 states already allow public off-MLS marketing.

Why it matters for agents

This is now a fight across several regions. Inman counts at least nine MLSs that have publicly rejected Compass' demands or gone to court. Together they report about 272,000 subscribers and users, though some agents belong to more than one MLS. Before this filing, CRMLS sued Compass on Oct. 5 and Compass sued CRMLS on Oct. 16. Unlock MLS and OneKey MLS have also refused the demands publicly.

If you belong to one of these MLSs, the current rules still apply while the cases continue. That includes fines for publicly marketing a listing without entering it. Some MLSs point out that sellers have other options. Canopy CEO AnneMarie DeCatsye said the MLS offers Coming Soon, Private Exclusive and Limited Exposure listings. She drew a line between keeping a property private and marketing it publicly while keeping it out of the MLS. REcolorado CEO Dana Bennett and DeCatsye both said the dispute is about MLS rules, not individual Compass agents.

Before you plan pre-marketing or office-exclusive strategies, check your own MLS's listing statuses and penalties. As RISMedia notes, the outcome is likely to shape how listings are shared across the industry.