Summary Judgment Affirmed By Sixth Circuit In Broker Commission Price-Fixing Litigation

On November 13, 2014, the Sixth Circuit Court of Appeals upheld the dismissal of price-fixing claims against two home brokerage service firms in Kentucky, McMahon Co. and HomeService of America, Inc. Hyland, et al. v. HomeServices of America Inc., et al., case number 12-5947. The plaintiffs, a class of Kentucky brokers, alleged that the defendants conspired to raise the price of broker commission fees in violation of Section 1 of the Sherman Act. The plaintiffs supported their claims by alleging that public comments made by McMahon Co. regarding not cutting fees in the face of competition from internet brokers showed a unity of purpose amongst the defendants. They also pointed to the fact that defendant companies typically set their listing commission fee at six percent. The defendants, on the other hand, argued that the fee was not set through agreement between brokers and that commission fees could be negotiated for specific transactions. The Western District of Kentucky granted summary judgment for the defendants, and the plaintiffs appealed.

The appellate court affirmed, determining that there was no direct evidence of an agreement and insufficient circumstantial evidence for the plaintiffs' claims to defeat summary judgment. Citing the Supreme Court's precedent in Matsushita Electrical Industrial Co. v. Zenith Radio Corp., 475 U.S. 574 (1986) and the Sixth Circuit decision in Re/Max, Int'l, Inc. v. Realty One, Inc., 173 F.3d 995 (6th Cir...