Top Agent Network, Inc. v. National Association of Realtors

Background

Top Agent Network asked the court to reconsider an earlier order dismissing claims based on the National Association of Realtors’ Clear Cooperation Policy. The order focuses on whether the complaint adequately alleged violations of federal and state antitrust laws and related unfair competition.

Court’s reasoning

The court relied on the Ninth Circuit’s decision in The PLS.com, LLC v. National Association of Realtors. That decision said the relevant market is the market for real estate listing services, where real estate agents subscribe to listing platforms and post listings, rather than the broader market for buying and selling homes.

The court held that Top Agent Network adequately alleged a per se group boycott under the Sherman Act. A per se group boycott is an alleged agreement or coordinated effort to prevent a competitor from obtaining needed supplies or access. The complaint alleged that the policy forced Top Agent Network and other listing services to compete for listings on unfavorable terms, making it difficult for new competitors to enter the market.

The court also held that Top Agent Network adequately alleged antitrust injury. It said the alleged injury flowed from the policy’s effects on competition among listing services because the policy allegedly restricted agents’ ability to post listings with Top Agent Network, thereby restricting Top Agent Network’s supply of listings.

The court rejected the view that Top Agent Network’s own potentially anticompetitive conduct completely barred its antitrust claims. It also said that, at this stage, it was inappropriate to compare the policy’s alleged anticompetitive and procompetitive effects. The court noted that later proceedings may determine whether the policy should be evaluated under the per se approach or the rule-of-reason approach, which requires a fact-specific assessment of market power, market structure, and the restraint’s actual effect on competition.

Ruling

Judge Vince Chhabria granted Top Agent Network’s motion for reconsideration. The Sherman Act claim can proceed because the complaint adequately alleged a group boycott and antitrust injury. The Cartwright Act claim can also proceed because it requires the same antitrust-injury showing. The unfair-competition claim can proceed because the complaint stated Sherman Act and Cartwright Act claims.

The order states that the dismissal of the intentional-interference-with-contractual-relations claim was unaffected. Discovery may proceed immediately, and the court scheduled a case-management conference for August 30, 2024, with a joint case-management statement due August 23, 2024.