According to Laurie Janik, general counsel for the NAR, the DOJ still isn't satisfied with the NAR's new Internet Listings Display policy, but never told her it had a problem with the policy's blanket opt out feature, which allows brokers to decline to put their listings online for other brokers to use. Even though the opt-out is reciprocal, the DOJ says it "obstructs real estate brokers who use innovative Internet-based tools to offer better services and lower costs to consumers."

The DOJ filed a civil antitrust lawsuit against the NAR yesterday in U.S. District Court in Chicago, saying that the NAR's policy "prevents consumers from receiving the full benefits of competition and threatens to lock in outmoded business models and discourage discounting."

"The purchase of a home is one of the most significant financial decisions a family can make, and NAR's policy stifles competition to advantage some of its members at the expense of home buyers and sellers across the country," said J. Bruce McDonald, Deputy Assistant Attorney General in the Department's Antitrust Division. "Consumers benefit when real estate brokers are free to compete vigorously by offering innovative services."

Although NAR today announced its adoption of a revised policy, the revised policy continues to discriminate against innovative brokers, and does not resolve the Department's concerns, said the DOJ.

The new policy, a hybrid of the broker reciprocity-based Internet Data Display (IDX) policy and the Virtual Office Website (VOW) broker opt-out-based policy allows brokers to share listings online through the MLS, but allows brokers to "blanket" opt-out of sharing their listings online. In fairness, if they do so, they won't be able to display other brokers' listings. However all brokers will be able to share individual listings with their clients, as they always have. All brokers would be able to share listings on an individual basis with clients, however, so any concern that the ILD prevents consumers from seeing the listings is disingenuous.

"It's a good policy," says Janik. "It's better than the other policies, but the Justice Department still has concerns with it."

According to Janik, the NAR showed the DOJ the policy, yet two days before it was announced to the membership, the DOJ told Janik that it had "concerns." Yet, she says, they would not specify what those concerns were.

When she showed them the ILD policy, "they indicated they intended to challenge it, but then again, that is what they told the Wall Street Journal last May about the 'old' policy," says Janik.

The DOJ did not respond to inquiries from Realty Times over whether the DOJ was happy with the ILD policy until after it had filed its suit. J. Bruce McDonald, the attorney who had been negotiating with the NAR, refused to talk to Realty Times, asking that Realty Times speak with Gina Talamona, spokesperson for the DOJ first. Ms. Talamona did not return calls until after the suit was filed.

The suit makes it clear that the concerns were about a "blanket" reciprocal opt-out option that enables brokers to prevent other brokers from posting their listings online to competitive websites, but by the same token, the noncooperating brokers can't post others' listings on their websites either.

"We've obviously been working with them since May," says Janik, "to create a policy that everyone likes, and it has always included a blanket reciprocal opt-out. We have diligently addressed the issues they raised which were selective opt-out, the referral fee restriction where there is no specific restriction on VOWs, and the 'clean page rule' about not putting advertising around the listings when you post them to your Website. Those were the three initial concerns, and it was the focus of all of our conversations for many months."

Then, the DOJ came back with details, that the NAR also diligently addressed, says Janik. "When a broker opts-out he has to opt out for a reasonable amount of time," says Janik, "so we determined that 90 days is reasonable. They wanted to make sure that when a broker got the feed that the broker knew which properties weren't in that feed, and again we put that provision in. We addressed co-branding on websites. They were concerned with the parity principle, that business can be conducted online as it is in brick and mortar locations, and we dutifully responded to that."

These provisions certainly suggest that the DOJ knew the NAR intended to include the blanket reciprocal opt-out in its policy.

So did the DOJ sandbag the NAR? Janik says no, the lawsuit wasn't a complete surprise.

"I'm disappointed," says Janik. "I thought this was something reasonable people could have agreed upon. We have one policy for our MLSs to administer, and they still had a concern and wouldn't tell us what it is, which is especially disappointing after we have gone through so many discussions."

The official response from the NAR is as follows:

"We believe the new ILD policy is fair, pro-consumer, pro-competitive and accommodates innovation. After months of negotiations, we are at a loss to understand why the Department of Justice would bring a legal action. Many of the changes incorporated in the new policy are in direct response to concerns they have raised over the course of the two year investigation."

"The policy will bring consumers more points of access to real estate information from multiple listing services than they have ever had before. For consumers, whether they are home buyers or sellers, this new policy is a win-win. Buyers will be able to find all the listings available for public display on the Web site of the broker of their choice and sellers will be able to work with the listing broker of their choice. The policy treats all MLS members equally yet respects the rights of property owners and their listing brokers to market a property as they see fit."

Published: September 9, 2005

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Blanche Evans is the award-winning senior editor of Realty Times, the Internet's leading independent real estate news service. She is featured daily on the Realty Times Video Network in the "Realty Viewpoint" segment. Blanche has been named one of the "25 Most Influential People In Real Estate" by REALTOR Magazine, and has been twice recognized as a "notable." In 2005, she was named "Top Reporter Covering the NAR" by Delahaye-Bacon's. Blanche is a renowned author of five real estate books. Her newest, Bubbles, Booms and Busts: Make Money In Any Real Estate Market, McGraw-Hill, was rave-reviewed by The New York Times. She was also selected from hundreds of real estate experts to contribute to Donald Trump's book, Trump: The Best Real Estate Advice I Ever Received: 100 Top Experts Share Their Strategies, Rutledge Hill Press, and is featured on page 68. Order Now Review - Honors In 2006, Blanche was selected among scores of candidates to author two consumer real estate guidebooks for the National Association of Realtors: The NAR Guide to Home Buying, and The NAR Guide to Home Selling, Wiley & Sons. She is currently planning two new books for the NAR and its members.       Known for her keen insight into real estate industry issues and for her ability to make complex subjects easy to understand, Blanche is a sought-after keynote and continuing education speaker. Real estate organizations from MLSs, to brokerages, to franchisors, to associations hire her to provide up-to-the-minute analysis of real estate industry news and advice on how to improve revenues. Her passionate delivery, peppered with stinging wit, is a huge hit with audiences and fans. Don Klein, CEO Greater Nashville Association of Realtors, Blanche Evans, Richard Courtney, president 2007, GRAR "The GNAR membership meeting last week featured Blanche Evans as the keynote speaker. Her comments and insights resonated extremely well with those in attendance and we have had many requests for copies of her PowerPoint Presentation. She was a terrific part of the membership meeting and convention program!" - Don Klein, CEO Greater Nashville Association of Realtors Coverage from WSMV, Nashville - 8-14-2007 That Interview Guy - Get Inside The Head Of Today's Generation 2007 AE Institute Session - To purchase 2006 AE Institute Session - Parts 1 2 3 4 5 6 7 8 9 HouseValues Mastermind call - Parts 1 2 Blanche's fireside chat with Jeremy Conaway, HAR - Click here. To contact Blanche, email her at . For more articles by Blanche, click here.