Anywhere, Coldwell Banker Warburg Execs Analyze Sitzer

Anywhere Real Estate addressed agents last week to chart the course amid a growing stack of antitrust lawsuits targeting broker commissions.

Executives with the parent company of Corcoran, Coldwell Banker, Century21 and Sotheby’s International Realty doubled down on the firm’s move to propose a settlement shortly before the landmark Sitzer/Burnett antitrust lawsuit headed to trial.

Anywhere’s $84 million deal, which has to be confirmed by a judge, included language aimed at shielding it from future commission-related antitrust litigation. CEO Ryan Schneider said the move will allow the firm to capitalize on what it believes is a favorable position relative to its competitors.

The comments at a town hall event held for Coldwell Banker agents last week are the most detailed from the residential giant as the industry attempts to forecast the consequences of a wave of copycat antitrust litigation.

There’s a good chance the verdict that found the National Association of Realtors and two brokerages guilty of colluding to inflate commissions could be overturned during the appeals process, Anywhere’s senior vice president of litigation Lynette Carhart Gladdis said, and the settlement could take six to nine months to be approved.

Coldwell Banker Warburg president Frederick Peters offered agents a similar forecast in an internal document obtained by The Real Deal. Coldwell Banker Warburg was bought by Coldwell Banker in 2021.

“I worked in the industry before we shared listings and co-broked them with other firms in the marketplace,” said Peters. “The entire system was hit-or-miss.”

The jury’s verdict in the Sitzer/Burnett suit didn’t specify changes to the rules that shape commission arrangements, but industry players have taken turns issuing predictions for the fate of industry regulations as legal efforts proceed.

While executives may be happy they don’t have the burden of expensive copycat lawsuits in front of them, they’re hoping their competitors can do the heavy lifting for them and save the shared commission structure. Schneider said he supports keeping commissions coupled because many buyers can’t afford to pay for representation.

Peters concurred in his memo, adding that buyers may subtract the commission charge from their offer.

“Time and again buyers who at first wanted to go it alone come to agents after losing a property because they misread the circumstances or didn’t really understand the rules,” said Peters. “An unrepresented buyer is dealing with an agent who represents only the seller’s best interests … it’s the real estate equivalent of going into court pro se.”

Agents during the town hall were advised not to describe buy-side work as free. Anywhere will also be minimum client commission requirements at its owned-brokerages, according to a document it published on the settlement.

Coldwell Banker Warburg agreements will be changed to explain that brokers aren’t splitting commissions, Peters said, and instead that sellers are making offers directly to co-brokers who represent the buyer.

“Our RLS system, which usually offered co-brokers defined commissions, but was never required to and sometimes did not, will as we move forward transparently show what commissions are being paid to both sides in the event an offer to share commissions is made by the seller,” said Peters. “And life will go on.”