Washington v. Tacoma-Pierce: Washington State Attorney General May Challenge Membership-Based Access to MLS
In Washington v. Tacoma-Pierce, Tri-City, & Spokane Bd. of REALTORS®, the Supreme Court of Washington addressed the State's challenge to restrictions on MLS access based on membership in a local Board of REALTORS® (Board). The court held that the State Attorney General could bring an antitrust action challenging that restriction under the state Consumer Protection Act (CPA).
The state filed separate antitrust actions against three associations alleging violations of the CPA by restricting access to the MLS. The allegations were based on RCW 19.86.020 (unfair methods of competition and unfair acts or practices) and RCW 19.86.030 (conspiracy in restraint of trade). The specific act alleged to violate the CPA was to deny brokers who are not members of the Board access to the MLS. The effects of the violations were claimed to be: (1) to suppress and eliminate competition by non-members; (2) to create artificial entry barriers into the trade; (3) to deny consumers the benefits of free and open competition; and (4) to artificially increase the commissions paid by consumers. The trial courts dismissed the Tacoma-Pierce and Tri-City claims and granted summary judgment to the Spokane Board. The cases were consolidated for consideration by the Supreme Court of Washington.
The Supreme Court of Washington reversed the dismissals and summary judgment granted by the trial courts. The supreme court held that the defendants' actions did not fall within an exception to the CPA which provides that actions specifically permitted by a regulatory board or commission shall not be considered to be a violation of chapter 19.86 RCW. The defendants urged that the Department of Licensing or Real Estate Commission had approved their restrictions on access to MLS, but the court found that no specific permission was granted.
The Supreme Court of Washington also noted that RCW 18.85.400 states "in no event shall the real estate commission approve any entrance requirements which shall be more restrictive on the person applying to join a real estate multiple listing association than the requirements listed in the statutes." The court found that the Department of Licensing or Real Estate Commission did not have the authority to approve the restrictions on participation in a MLS which were required by the defendants, e.g., that one maintain membership in a local Board of REALTORS®. After the case was remanded, however, the State later voluntarily dismissed the case without resolution of the issue of whether the membership rule did violate the CPA.
Washington v. Tacoma-Pierce, Tri-City, & Spokane Bd. of REALTORS®, 95 Wash. 2d 280, 622 P.2d 1190 (1980).