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Open MLS Initiative Just Getting Started, Says NAR Nemesis Barry

Written by Posted On Thursday, 03 August 2006 17:00

Long-time nemesis of NAR, San Francisco anti-trust attorney David Barry has failed in his recent attempt to put an open-to-the-public statewide MLS on California's November ballot. Barry had filed a ballot initiative with the California Attorney General Bill Lockyer, claiming that a public MLS would end the real estate industry's monopoly on home listings.

He needed 373,000 signatures to get the initiative on the ballot. There are 23 states, including California and Maine, that allow voters to create law by proposing initiatives. That's Barry's strategy, to get voters to create initiatives that demand state MLSs, which one day will turn into a national MLS.

"People want one source to find information," he says.

Only if it's handed to them on a silver platter and they don't have to do anything.

According to a release by the California Association of Realtors , Barry "failed to gather even a modicum of support in its efforts to qualify for the November ballot, according to information provided by the California secretary of state's office today. Barry reportedly was unable to secure a single supportive reported signature for the "Open MLS" initiative during his statewide collection efforts over the past several months."

"It was a trial balloon," shrugs Barry, "It would cost millions to fund signature-gathering."

For those who are wondering, Barry's Open MLS initiative is designed to create a statewide multiple listing service for sales and rentals to be operated by a private firm that would bid to obtain its charter to operate from the state, much like cable companies receive monopolistic charters from municipalities. The site would charge approximately $20 per listing no matter who submits it, agent or seller, but would be free to anyone who wants to peruse the listings or use the listings in their business model.

There's one caveat. Professionals would be subject to specific rules that could get them into trouble if they don't adhere to them, while sellers wouldn't be held to the same standard.

"Barry's failed ballot initiative effort was his latest attempt to monopolize the MLS and compel real estate licensees to subscribe to and deliver listings to the service," huffs C.A.R. President Vince Malta. "The initiative also permitted unscrupulous shake-down lawyers to sue licensees even if there were no damages."

Barry fires back, "Monopolize? I wasn't trying to monopolize anything, and it wouldn't force real state agents to do anything. It gives power to sellers to place listings in an open MLS. In fact, CAR has an initiative that they'd like to own a statewide MLS. There is nothing in the initiative that addresses unscrupulous lawyers."

Malta is referring to Barry's proposed rule that agents must submit their listings within 24 hours of obtaining the listing contract, or suffer the consequences of pocketing listings.

"There was a mechanism that dealt with people bent on undermining the law," explains Barry, "and cure wide-spread violation of the law, but the enforcement wasn't as effective as it could be. Litigation is slow and cumbersome."

So, Barry has tinkered with the Open MLS initiative with hopes of having better luck in Maine, where he only needs 50,000 signatures to get on the ballot.

According to the Maine initiative, ownership of the listing does not belong to the broker/agent, but to the client. Brokers must list with the Open MLS if the client requires it, even if it means the broker must pay a subscriber fee. And there's no guarantee of getting paid if the client decides a rule has been broken. "A real estate brokerage agency may not collect compensation on any real estate transaction in which the offer leading to the transaction was made at a time when the real estate brokerage agency was in violation of its duty to list the property with the Open MLS."

"The enforcement is through the seller to combat the practice of pocket listings," says Barry. "There is no litigation remedy in Maine, there might be other remedies if an agent is disloyal, all they know is, if the listing wasn't fully exposed, it might have brought a better price or cleaner offer."

In July 2006, The Open MLS Institute director, Stavros Mendros, filed an initiative with the Maine Secretary of State. Barry says the Institute should hear back within the next week whether they have the go-ahead to pursue signature-gathering for the November ballot.

"If you have success in Maine," says Barry, "it will spread to the rest of the U.S."

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