Compass sues Seattle-area listing database as battle over exclusive real estate listings escalates

This story originally appeared on Real Estate News.

The heated dispute between brokerage giant Compass and Kirkland, Wash.-based Northwest Multiple Listing Service over pre-marketing rules and private exclusive listings has now escalated to the courts. 

On April 25, Compass filed a lawsuit against NWMLS in U.S. District Court for the Western District of Washington alleging “monopolistic” and anticompetitive business practices, obstruction of seller choice, retaliation via a recent suspension of data services and other claims. 

The New York Times first reported the news of the filing. 

What Compass claims: The brokerage takes direct aim at several NWMLS policies, including rules against pre-marketing and office exclusives, which Compass lawyers say affect seller choice, hurt consumers and prevent the brokerage from implementing its 3-phase marketing strategy. 

Compass said it had spent months trying to work with NWMLS to implement rule changes that would allow office exclusives, but claimed NWMLS “simply refused” to do so.

“With NWMLS’s anticompetitive and tortious conduct, the only way a home seller in the Seattle area can effectively have the choice on how to market their home is to forgo using a professional real estate broker at all, because NWMLS has 100% of the real estate brokers in the Seattle area,” Compass lawyers wrote in the complaint, adding that NWMLS’ rules against pre-marketing and private exclusives “prevented meaningful competition from gaining traction.”

Filing follows weeks of attacks: Since March, Compass CEO Robert Reffkin has been making similar allegations against NWMLS via social media posts on Instagram and LinkedIn. Reffkin also attacked the NWMLS board, which he previously claimed was controlled by Windermere — a dominant brokerage in the region which has six affiliated agent members on the board. But in the April filing, Compass goes further, alleging that all brokerages who have member agents on the NWMLS board are “co-conspirators with each other and NWMLS.”

The filing also reveals insight into Tabata Perron, the lone Compass-affiliated board member who was appointed in January but left in recent weeks, saying that she had resigned “in protest of NWMLS’s anticompetitive and tortious conduct.”

How we got here: The feud began in late March after Compass launched private listings in the Seattle area in defiance of NWMLS rules — likely in an attempt to force the MLS to take action. Seattle-area market leader Windermere had also been pulled into the battle as Reffkin claimed Windermere and NWMLS had colluded to prevent Compass from pushing its 3-phase marketing strategy in the area without risk of steep fines and other penalties. Windermere CEO OB Jacobi responded by saying that Compass was playing “dirty.”

Despite the risks, Compass still planned and executed a private exclusives blitz in March, and Reffkin applauded each agent in separate social media posts as their listings went live. While Compass agents who spoke to Real Estate News about the pre-marketing campaign indicated that no fines had been levied — and confirmed that Compass would cover any fines they may incur — the dispute between the two parties continued, leading to a temporary two-day suspension of Compass’ IDX feed.

Litigation foreshadowed: Prior to the April 25 filing, Reffkin had hinted at possible legal action against NWMLS via an Instagram post with a quote from a law firm. And previously, Compass launched a website — “Washington Homeowner Rights” — which sought to collect contact information from Compass seller clients for a possible class action against the MLS.