Legal Action Funding Case Report - RPCTE 2014
Below are summaries of the case funding recommendations made by NAR's Legal Action Committee, which were subsequently approved by the Board of Directors at the 2014 REALTOR® Party Convention and Trade Expo, held in Washington, D.C. during May 2014.
NAR provided funding of $ 435,000 in six of the seven cases for which assistance was requested, as follows:
a) Heartland Apartment Association et al v. City of Mission. A coalition has filed a lawsuit challenging the City of Mission's (KS) "transportation utility fee" as an impermissible excise tax, which the town is prohibited from enacting under the state’s laws. The trial court found that the fee was a tax and not a utility fee, but also ruled that the tax was not a prohibited excise tax and therefore City had the authority to enact such a tax. This ruling is now being appealed to the Supreme Court of Kansas.
NAR will contribute to the coalition appealing the trial court’s judgment, matching similar contributions by the Kansas Association of REALTORS® and the Kansas City Regional Association of REALTORS®.
b) Property Disclosure Technologies, LLC v. JB Goodwin REALTORS® (TX). Brokerage firm JB Goodwin REALTORS® was sued by Property Disclosure Technologies, LLC for patent infringement. The lawsuit alleges that the patents cover the process of querying a database for properties listed for sale that meet certain user-specified criteria. The court has consolidated this case with 12 other real estate defendants who were also sued for infringement of the same patents.
NAR will match the contributions (up to a certain number) of the Texas Association of REALTORS® for the legal expenses incurred by JB Goodwin REALTORS®.
c ) Property Disclosure Technologies, LLC v. Better Homes and Gardens Real Estate, LLC and Winans, Inc. (TX) Better Homes and Gardens Real Estate, LLC and Winans, Inc. was sued by Property Disclosure Technologies, LLC for patent infringement. The lawsuit alleges that the patents cover the process of querying a database for properties listed for sale that meet certain user-specified criteria. The court has consolidated this case with 12 other real estate defendants who were also sued for infringement of the same patents.
NAR will match the contributions (up to a certain number) of the Texas Association of REALTORS® for the legal expenses incurred by Better Homes and Gardens Real Estate, LLC and Winans, Inc.
d) Thienes v. City Center Executive Plaza, LLC (AZ). A developer purchased a failed golf course development out of foreclosure. The golf course was surrounded by existing homes that are part of a homeowner’s association. The developer constructed an upscale RV park and "event tent" on parts of the golf course property after having reviewed the recorded permissible uses for the property and having acquired all necessary development approvals from the county. The homeowner's association sued to challenge the developer's right to operate the RV park and event facility. The court ruled that the developer had constructive notice of an implied restrictive covenant on the golf course, that operation of the RV park and event tent was a private nuisance, and on other grounds has enjoined operation of the RV park and uses of the property other than as a golf course. The developer is appealing that ruling.
NAR will file an amicus curiae brief with the appellate court supporting the developer, to be filed in coordination with the Arizona Association of REALTORS® after discussions about the most effective approach for such a brief.
e) Regional Multiple Listing Service of Minnesota, /nc. d/b/a NorthstarMLS v. American Home Realty Network, Inc. (MN). Regional Multiple Listing Service of Minnesota, Inc. (RMLS) sued American Home Realty Network, Inc. (AHRN), for copyright infringement of RMLS listing data, which appears on AHRN's "Neighborcity.com" website without a license or other permission from RMLS. AHRN filed a counterclaim alleging that RMLS has violated the antitrust laws by conspiring with NAR and others not to provide listing data to AHRN or adversely affecting AHRN in other ways.
NAR will contribute to the legal expenses incurred by the Regional Multiple Listing Service of Minnesota.
f) Monell, et al v. Boston PADS LLC, et al. (MA). A group of real estate agents for several Boston area real estate firms filed a class action lawsuit against their brokerage firms, alleging that under the Massachusetts general "independent contractor statute" they should have been classified as employees because of the control exercised over them by the brokers, and other factors. They sought protection under the state's wage and labor laws, which apply only to employees. Certain provisions of the state's license law permit real estate sales agents to be affiliated with brokers as independent contractors and paid on a commission-only basis, even though it is also required that they be subject to broker supervision. The court concluded that the license law provisions control classification of the salespeople as independent contractors and dismissed the lawsuit. The salespeople are appealing this ruling, and the case is now before the Massachusetts Supreme Court.
NAR will contribute one-third of the costs incurred in the preparation of an amicus curiae brief to be filed on behalf of the Massachusetts Association of REALTORS® and Greater Boston Real Estate Board in support of the broker.