San Francisco anti-trust attorney David Barry has lost another court ruling in favor of the California Association of Realtors in his quest to use the courts to dismantle real estate industry associations and MLSs.

The California Association of Realtors® (C.A.R.) is suing Barry for malicious prosecution and has announced that the Court of Appeal, Fourth Appellate District, Division One has again ruled in favor of C.A.R. in its malicious prosecution complaint against attorney David Barry and plaintiff Arleen Freeman. Barry, on behalf of Freeman, had originally sued Sandicor, a southern California MLS for alleged antitrust violations and price-fixing. The case was thrown out when it was discovered that Freeman, by taking part in the MLS, broke her agreement not to sue the MLS as an association member. Barry and Freeman lost on summary judgment, and the U.S. Court of Appeals upheld C.A.R.'s dismissal. Yet, Freeman and Barry refiled the suit in the same federal court and also sued the attorneys in the case.

C.A.R. says it filed the malicious prosecution action against Arleen Freeman and her attorney David Barry in September 2005 whereupon Barry filed a motion to strike C.A.R.’s malicious prosecution complaint, which the San Diego Superior Court denied in February 2006, agreeing with C.A.R.’s position that no reasonable attorney could think there could be another lawsuit on the same matter that had already been dismissed by the Federal District Court and the Federal Court of Appeals. The February 2006 court decision found that no reasonable attorney would file this suit and that C.A.R. demonstrated sufficient evidence of malice to go forward with the case against Barry.

Barry's remarkable persistence backfired against him more than once. He has almost single-handedly confronted the industry about practices he believes should be halted, from the NAR's servicemark control of the words Realtor and Realtors, to MLS "price-fixing," to associations forcing licensees and others to join the board in order to gain access to the board's MLS database.

According to C.A.R., Barry has "brought more than a dozen legal actions against C.A.R. and organized real estate for more than two decades, yet in these cases his clients have never obtained a judgment against associations of Realtors® except in one case on a narrow legal issue pursuant to a settlement to avoid the costs of trial."

That puts C.A.R. in an unforgiving mood.

"The courts ruling is a solid win that puts C.A.R. in a very favorable position for the next phase of the litigation: discovery and then trial," said C.A.R. President Colleen Badagliacco. "We are very pleased with these results.

"Lawyers are required to have some legal basis for pressing a suit," she said. "State law prohibits malicious prosecution such as when litigants re-file the same matter against the same defendants, causing the defendants to incur attorneys’ fees and costs to get it dismissed. At some point, litigation is supposed to be conclusive."

What presiding Justice Benke of the Court of Appeal, Fourth Appellate District, Division One had to say in his ruling , "Here, any reasonable attorney would have recognized the claims asserted in Freeman III were fatally defective on a whole host of grounds. No reasonable attorney, conversant on any level with the holding in Freeman II, would construe these cases as in any manner supporting the notion that prior litigation conduct, including discovery abuses, itself amounts to a restraint on trade."

"In the end, it is the volume of fatal defects in the claims asserted in Freeman III which bring it within that narrow class of cases which all reasonable lawyers would agree lack merit," Justice Benke ruled. "From this circumstance a reasonable trier of fact could infer the principal purpose of Freeman III was to consume C.A.R. resources that might otherwise be available to other antitrust defendants or compel a settlement from all the defendants, including C.A.R. This inference of a collateral purpose would of course be supported by the complete lack of merit in Freeman III. Here, however, there is a great deal more which suggests malice towards C.A.R."

"C.A.R. was able to show a probability of success on each element of its malicious prosecution claim," Benke concluded.

"The case against both Arleen Freeman and David Barry and Barry and Associates will now proceed," Badagliacco said. "We expect to continue to prevail."