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Six Cases Selected for Legal Action Funding

November 20, 2013

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 2013 Realtors® Convention and Expo, held in San Francisco, CA, during November 2013.

NAR provided funding of $363,667.55 in six cases for which assistance was requested, as follows:

  1. Regional Multiple Listing Service of Minnesota, Inc. d/b/a NorthstarMLS v. American Home Realty Network, Inc. (MN). The Regional Multiple Listing Service of Minnesota, Inc. (“RMLS”) sued American Home Realty Network, Inc. (“AHRN”) for copyright infringement of RMLS listing data and photos, which appears on AHRN's "Neighborcity.com" website without a license or other permission from RMLS. RMLS obtained a preliminary injunction prohibiting AHRN from displaying its MLS data. AHRN filed a counterclaim alleging that RMLS violated the antitrust laws by conspiring with NAR and others to withhold listings from AHRN or adversely affect AHRN in other ways. RMLS moved to dismiss that counterclaim but the motion was denied, which means that RMLS must defend that counterclaim on the merits. Discovery in the case is now proceeding.
  2. All Cities Realty, Inc. v. Brunet, et al. (CA).  The owner of the trademark "All Cities Realty" sued 1,200 real estate brokers and agents affiliated with Re/Max All Cities Realty for directly infringing Plaintiff's trademark. The firm name Re/Max All Cities Realty was registered with the California DRE and the affiliated brokers and agents used the firm name as required by California license law. The issue presented is whether agents can be held individually liable for trademark infringement where the firm's name includes a third party's registered trademark. The agents' motion to dismiss was granted by the trial court but the California Court of Appeals reversed and held that the plaintiff properly alleged a claim of direct infringement of its trademark by the agents. The agents' petition for review by the California Supreme Court is pending.
  3. Marin Association of REALTORS® v. California (CA). The California Association of REALTORS® and the Marin Association of REALTORS® were successful in getting the California Attorney General to set aside the 1978 "Final Judgment Granting Permanent Injunction and Imposition of Civil Penalty" that prohibited the Association's operation of its MLS that imposed onerous and restrictive requirements on the operation of its MLS. The Attorney General agreed to vacate that Final Judgment with a private agreement that permits MAR to differentiate between REALTORS® and MLS Only participants in the provision and cost of additional services.
  4. Key West Association of REALTORS® v. Allen (FL). Plaintiff Key West Association of REALTORS® (KWAR) operates Key West MLS. Defendant Allen owns and operates a commercial website at www.KeyWestMLS.com. At all times, that website consisted almost entirely of content, data, and images reproduced without authorization from Plaintiff's Key West MLS. Allen ignored KWAR's cease and desist letters and failed to respond to the copyright infringement action KWAR filed against Allen. The Court entered a default judgment in favor of KWAR and against Allen for copyright infringement and awarded KWAR damages of $2.7 million. The Court also awarded KWAR its attorneys' fees in an amount to be determined.
  5. The Land Man Realty, Inc. v. Weichert, Inc., Weichert REALTORS® Northeast Group, and Lorraine Conoby (NY). Plaintiff commenced this litigation against Weichert seeking a share of the commission paid to Weichert as listing broker on the sale, alleging breach of contract and a theory of "unjust enrichment." Since both plaintiff and defendant are Realtor® firms, Defendant responded that the breach of contract action was barred by the plaintiff's duty to arbitrate the claim pursuant to Article 17 of the Code of Ethics. The court concluded that "there was no contract between plaintiff and defendants in this case," and therefore the duty under Article 17 of the Code of Ethics to arbitrate "contractual or specific non-contractual disputes described in section 17-4" (of the Standards of Practice) did not apply to bar plaintiff's claim. The New York State Appellate Division affirmed the lower court's ruling. Weichert's request for a rehearing by the Court of Appeals was denied. Weichert has no further right to appeal.
  6. Sabo & Associates, Inc. v. American Associations, Inc. and Haney (MI). Defendant Haney seeks reimbursement for costs incurred in defending a lawsuit that resulted in the Michigan Court of Appeals affirming the trial court's decision upholding and enforcing the arbitration decision of the Flint Area Association of REALTORS®.