CREA & industry face class-action suit: Allegations of anti-competitive practices echo ‘Sunderland’ claim

Houses for sale in Ottawa

Last week, the Canadian Real Estate Association (CREA) sent industry board and association leadership information on the recent class-action suit, McFall v. CREA et al., filed on January 18.

The suit names CREA along with several board, association and corporate defendants (including specific brokerages and franchisors).

 

A ‘Canada-wide version of the Sunderland claim’

 

CREA goes on to describe the claim as “essentially a Canada-wide version of the ongoing class action in Sunderland v. CREA et. al. and was filed by the same legal counsel. The only association defendants named in the Sunderland claim are CREA and the Toronto Regional Real Estate Board (TRREB), while the new McFall claim names a number of boards and associations across Canada but does not include TRREB.”

Like Sunderland, the McFall claim was filed on behalf of anyone who sold property on any of the named defendant board and association’s MLS systems since March 11, 2010.

 

Allegation: Cooperating commission rules & defendants’ actions result in anti-competitive, price-fixing conspiracy

 

The communication states both claims allege that “rules requiring home sellers to offer a cooperating commission to prospective buyer brokerages when listing a property on an MLS system are anti-competitive and have harmed home sellers in the form of higher commissions, even though the cooperating commission is the subject of negotiation and the amount offered can be any amount except zero.

The allegation is that these rules, together with actions by the corporate defendants to implement and enforce those rules, amount to a conspiracy to fix and control buyer brokerage commissions and insulate them from competition, contrary to the Competition Act.”

 

“We consider the allegations to be without merit and will continue to vigorously defend against them”

 

CREA explains that “MLS systems, including the Cooperation Pillar, are efficient and effective cooperative marketplaces that bring together realtors acting on behalf of Canadian home sellers and buyers, and are both pro-competitive and pro-consumer.”

In a statement provided to REM, CREA spokesperson, Pierre Leduc, says this article “covered a number of important points in these lawsuits. Given that the courts haven’t heard any arguments, there isn’t much more we can add at this time. 

That said, we consider the rules that frame cooperation between members as well as MLS systems result in efficient and effective cooperative marketplaces that are both pro-competitive and pro-consumer. We consider the allegations to be without merit and will continue to vigorously defend against them.”

 

Defendants: CREA, several Canadian boards and associations, but not TRREB

 

Aside from CREA, the defendants listed in the McFall suit are:

 

Regional real estate board defendants

 

  1. Newfoundland and Labrador Association of REALTORS® 
  2. Prince Edward Island Real Estate Association 
  3. Nova Scotia Association of REALTORS® 
  4. Greater Moncton REALTORS® 
  5. Real Estate Board of the Fredericton Area, Inc.
  6. Saint John Real Estate Board 
  7. Québec Professional Association of Real Estate Brokers
  8. Bancroft and Area Association of REALTORS®
  9. Barrie and District Association of REALTORS®
  10. Brampton Real Estate Board 
  11. Brantford Regional Real Estate Association
  12. Cambridge Association of REALTORS®
  13. Central Lakes Association of REALTORS® 
  14. Chatham-Kent Association of REALTORS® 
  15. Cornwall and District Real Estate Board 
  16. Durham Region Association of REALTORS® 
  17. Guelph and District Association of REALTORS® 
  18. Huron Perth Association of REALTORS® 
  19. Kawartha Lakes Real Estate Association 
  20. Kingston and Area Real Estate Association 
  21. Kitchener-Waterloo Association of REALTORS® 
  22. Lakelands Association of REALTORS® 
  23. London and St. Thomas Association of REALTORS® 
  24. Mississauga Real Estate Board 
  25. Niagara Association of REALTORS® 
  26. North Bay Real Estate Board 
  27. The Northumberland Hills Association of REALTORS® 
  28. Oakville, Milton and District Real Estate Board 
  29. Ottawa Real Estate Board 
  30. Parry Sound and Area Association of Realtors® 
  31. Peterborough and the Kawarthas Association of REALTORS® 
  32. Quinte & District Association of REALTORS® Inc.
  33. REALTORS® Association of Grey Bruce Owen Sound
  34. REALTORS® Association of Hamilton-Burlington
  35. Renfrew County Real Estate Board 
  36. Rideau-St. Lawrence Real Estate Board
  37. Sarnia-Lambton Real Estate Board
  38. Sault Ste. Marie Real Estate Board
  39. Simcoe and District Real Estate Board
  40. Southern Georgian Bay Association of REALTORS®
  41. Sudbury Real Estate Board
  42. Thunder Bay Real Estate Board
  43. Tillsonburg District Real Estate Board
  44. Timmins, Cochrane & Timiskaming Districts Association of REALTORS®
  45. Waterloo Regional Association of REALTORS®
  46. Windsor-Essex County Association of REALTORS®
  47. Woodstock-Ingersoll & District Real Estate Board
  48. Brandon Area REALTORS®
  49. Winnipeg Regional Real Estate Board
  50. Saskatchewan REALTORS® Association
  51. Alberta West REALTORS® Association
  52. Calgary Real Estate Board
  53. Central Alberta REALTORS® Association
  54. Fort McMurray REALTORS®
  55. Grande Prairie & Area Association of REALTORS®
  56. Lethbridge & District Association of REALTORS®
  57. Medicine Hat Real Estate Board Co-operative Ltd.
  58. REALTORS® Association of Edmonton
  59. REALTORS® Association of Lloydminster & District
  60. REALTORS® Association of South-Central Alberta
  61. Association of Interior Realtors
  62. BC Northern Real Estate Board
  63. Chilliwack and District Real Estate Board
  64. Fraser Valley Real Estate Board
  65. Kamloops & District Real Estate Association
  66. Kootenay Association of REALTORS®
  67. Powell River Sunshine Coast Real Estate Board
  68. Real Estate Board of Greater Vancouver
  69. Vancouver Island Real Estate Board
  70. Victoria Real Estate Board
  71. Yellowknife Real Estate Board
  72. Yukon Real Estate Association

 

Brokerage defendants

 

73. CIR Realty
74. eXp Realty
75.
MacDonald Real Estate Group Inc.
76. Maxwell Capital Realty
77. Oakwyn Realty Ltd.
78. Real Estate Professionals Inc.
79. Royal Pacific Realty Corp.
80. Team 3000 Realty Ltd.

 

Franchisor defendants

 

81. Century 21 Canada Limited Partnership
82. Coldwell Banker Canada
83. Exit Realty Corp. International (Canada)
84. HomeLife Realty Services Inc.
85. Keller Williams Realty Canada
86. MacDonald Real Estate Group Inc.
87. Max Wright Real Estate Corporation (Sotheby’s)
88. RE/MAX Ontario-Atlantic Canada, Inc. o/a RE/MAX Integra
89. Residential Income Fund L.P.
90. Sutton Group Realty Services Ltd.

 

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