An Oregon law that bans real estate agents from delivering personal notes from bidders to sellers is being challenged on First Amendment grounds.
USA Today reported on Saturday that a lawsuit filed Friday afternoon by the Pacific Legal Foundation on behalf of Total Real Estate Group claims the state’s ban on so-called “love letters” violates buyers’ freedom of speech.
“This censorship is based on mere speculation that sellers might sometimes rely on information in these letters to discriminate based on a protected class,” the lawsuit states.
The Fair Housing Act forbids sellers from either accepting or rejecting offers based on race or religion — information that could be passed along in the letters sent to sellers in hopes of gaining an upper hand in negotiations.
When the new law was signed by Gov. Kate Brown in June, Oregon became the first state to ban the practice of detailing personal information in writing or providing pictures or videos of potential buyers. In-person communication between buyers and sellers is still allowed.
Backers of the law, which is set to take effect in January, say it does not impede free speech. Democratic Rep. Mark Meek, who sponsored the bill, told USA Today it simply ensures buyers and sellers do not break fair housing laws. Letters can reveal information about bidders, leading to discrimination, usually against bidders who do not send letters.
But Attorney Daniel Ortner of the Pacific Legal Foundation, called the law a blatant violation of the First Amendment, claiming no such examples of fair housing complaints have been made.
A study in 2019 showed that the letters did have an effect on sales during a bidding war: Love letters came in second to all-cash offers in helping win the battle, increasing a bidder’s odds by 59 percent.
Some realtors have come out against the practice. In July, Ohio Realtors president Seth Task told a Cleveland television station he no longer welcomed love letters and encourages other realtors to reject them as well.