Company agrees to fee transparency changes following class action suit
The Real Brokerage has struck a $9.25 million settlement in the Umpa class action lawsuit, which alleged anti-competitive practices related to real estate commissions.
The settlement, reached through mediation, will be paid within 30 days of preliminary court approval, according to a news release by the brokerage.
The Umpa case, filed in Missouri, was the only major suit directly naming Real as a defendant. The nationwide settlement, which has received preliminary court approval, resolves the case and protects the company from future lawsuits with similar allegations.
Acknowledging the settlement in a statement, The Real Brokerage clarified its intent “to direct our energy to our agent community.”
The lawsuit, filed by a seller in Ohio and Maryland, argued that real estate commissions lacked transparency and stifled competition. It mirrors a wider trend of lawsuits challenging traditional commission structures.
As part of the settlement, The Real Brokerage has agreed to clarify the negotiability of commissions, avoid claims that buyer agent services are free, and disclose listing broker compensation offers. The brokerage also plans to develop training materials to support these practice changes.
The Umpa case is among nine potential cases that could be consolidated into a single, large lawsuit. A panel of judges is currently deliberating a consolidation request filed by attorneys involved in the Umpa and Gibson cases.
Read more: NAR lawsuit outcome could cut out buyer’s agent entirely - CEO
Real joins several major players, including Anywhere Real Estate, RE/MAX, Keller Williams, Compass, and the National Association of Realtors, in reaching settlements in commissions lawsuits.
With sales exceeding $12 billion in 2022, Real was one of over 90 brokerages not covered by NAR’s settlement agreement. While Real could have pursued a streamlined settlement path outlined in the NAR agreement, the company ultimately chose mediation, resulting in the $9.25 million settlement.
“We are committed to continuing to invest in our platform to provide our agents with the tools, training and technology they need to deliver the best possible home buying and selling experience for their clients,” said Tamir Poleg, chairman and CEO of Real. “At the end of the day, we want to ensure that clients receive the best possible guidance when making one of the biggest financial decisions of their lives.”
Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.
