NAR Settlement: Timeline of Lawsuits and Key Changes for Real Estate Agents

The real estate industry is undergoing one of its biggest shakeups in decades, driven by landmark lawsuits and the NAR settlement over buyer broker commissions. Agents nationwide must now adapt to new rules, from mandatory written agreements to off-MLS compensation changes.

By Christian Hill 7 min read
NAR Settlement: Timeline of Lawsuits and Key Changes for Real Estate Agents

All agents have to complete real estate continuing education, but the best don’t stop there. Our industry is ever-changing, and one of the biggest recent changes comes from the National Association of REALTORS® (NAR) settlement over buyer broker commissions. Below, we break down the timeline of major lawsuits (like Burnett et al. v. National Association of REALTORS® and Gibson v. National Association of REALTORS®), the Department of Justice’s involvement, and what practice changes are now in effect. It’s vital for agents in all states to understand these developments – you might even see them covered in your next real estate CE course or license renewal exam!


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From Lawsuits to Settlement: How We Got Here

The issue came to a head with class-action lawsuits filed by home sellers. In Missouri, the Sitzer/Burnett case alleged that NAR and major brokerages conspired to inflate commissions that sellers pay (typically a ~6% commission split between listing and buyer agents) chicagoagentmagazine.com. In October 2023, a Missouri jury found NAR, Keller Williams, and HomeServices of America liable and awarded $1.78 billion in damages chicagoagentmagazine.com. This stunning verdict sparked a wave of similar suits. On the same day, a Gibson et al. v. NAR lawsuit was filed in federal court, aiming to represent home sellers nationwide rirealtors.org. Another suit on behalf of buyers (often called the Moehrl case in Illinois, with a new lead plaintiff) also emerged, targeting many of the same practices rirealtors.org. In short, multiple cases across the country challenged the longtime practice of sellers offering compensation to buyers’ agents through the MLS.

Meanwhile, the DOJ had its eyes on real estate commissions too. NAR had struck a settlement with the DOJ in 2020 agreeing to greater transparency (for example, making it clear to consumers that buyer agent services aren’t “free”) reuters.com. However, in July 2021 the DOJ withdrew from that agreement to pursue a broader antitrust investigation reuters.com. NAR fought this move, but by January 2025 the U.S. Supreme Court allowed the DOJ’s investigation to proceed reuters.com. In other words, the DOJ–NAR lawsuit angle remains alive, even as NAR simultaneously grappled with the private class actions.

Facing massive liability after the Burnett verdict, NAR and several brokerages opted to settle the class-action claims in late 2023 and early 2024 rather than continue to trial and appeals. On March 15, 2024, NAR announced a settlement agreement to end the nationwide home seller lawsuits nar.realtornar.realtor. NAR did not admit wrongdoing, but agreed to pay $418 million over roughly four years nar.realtor (other brokerages like Anywhere, RE/MAX, Keller Williams, and others also contributed hundreds of millions via related settlements). This proposed settlement would cover NAR, over a million Realtor® members, and most brokerages and MLSs, effectively resolving Burnett et al. v. NAR, the pending Moehrl/Gibson cases, and similar claims if approved nar.realtornar.realtor. It’s a huge deal – literally and figuratively.


Key Changes Under the NAR Settlement

Beyond the payouts, the settlement required practice changes that affect agents and brokers nationwide. NAR agreed to implement these changes by mid-late 2024, and many went into effect on August 17, 2024 nar.realtornar.realtor. Here are the major changes agents need to know:

  • No More Mandatory Offer of Compensation in MLS: NAR put in place a new rule prohibiting offers of broker compensation from being published on the MLS nar.realtor. In the past, a listing had to include a stated compensation offer (e.g. “3% to buyer’s agent”). Now, that’s no longer allowed on Realtor-affiliated MLS platforms. Sellers can still offer to pay a buyer’s agent, but it must be negotiated off the MLS (e.g. privately between brokers or as part of the purchase contract) nar.realtornar.realtor. Some MLSs simply removed the compensation fields entirely (Bright MLS, for example, eliminated them for all property types, including rentals) brightmls.com. This change aims to eliminate the “mandatory” nature of cooperative commissions.
  • Written Buyer-Broker Agreements Required: Agents who work with buyers must now use a written agreement before showing a property. This agreement must clearly specify how the buyer’s agent will be compensated, in a way that’s “objective and not open-ended,” and include a conspicuous note that commissions are negotiable nar.realtornar.realtor. In short, you and your buyer client need to agree on what you’ll be paid (e.g. a percentage, flat fee, etc.) and put it in writing up front. NAR has long encouraged buyer representation agreements, and many states (like Tennessee, among others) already required them, but now it’s a nationwide policy empirelearning.comnar.realtor.
  • No Getting Paid More Than Agreed: The written buyer agreement must also forbid the agent from taking compensation from any other source above the amount agreed with the buyer nar.realtor. That means if a seller (off-MLS) offers a higher commission than what you and your buyer arranged, you can’t simply pocket the extra. You’d have to amend your agreement and get the buyer’s consent to receive more stellarmls.comstellarmls.com – or else let the surplus benefit the buyer (such as via a closing cost credit). This ensures transparency and that the buyer’s broker compensation is essentially capped by what the buyer agreed to.
  • Seller Approval of Any Co-op Offers: If a seller or listing broker does decide to offer compensation to a buyer’s broker off-MLS, they must obtain the seller’s approval in writing for the specific amount or rate nar.realtornar.realtor. No automatic or blanket offers—sellers need to knowingly consent to any incentive paid to a buyer’s agent.
  • Increased Transparency to Consumers: The new rules reinforce that buyers and sellers should discuss and negotiate commissions. Agents are encouraged to explain their services and fees clearly. NAR now provides consumer guides and FAQs (see facts.realtor, NAR’s information hub on the settlement nar.realtor) to educate the public. The end goal is that consumers understand who pays the buyer’s agent, how much, and that everything is negotiable.

These changes represent a cultural shift. For decades, many buyers assumed the seller paid their agent and didn’t give it much thought (often hearing that the buyer’s agent is “free”). Now, buyers will directly confront the question of their agent’s compensation – and agents will need to be prepared to have that conversation in a transparent, positive way.


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Looking Ahead: Ongoing Litigation and What to Watch

Even with the settlement, this saga isn’t completely over. The class-action settlement had to be approved by the court, and as of late 2024 some class members filed objections and appeals, which could delay final payouts realestatecommissionlitigation.com. (Not everyone was satisfied with the terms – some sellers feel they deserve more, perhaps unsurprisingly when legal damages were initially set at $1.78 billion.) NAR’s President at the time emphasized that “this matter is not close to being final” until appeals are resolved chicagoagentmagazine.com. Burnett et al. v. NAR is essentially resolved pending settlement approval, but Gibson et al. v. NAR (the copycat case) and other spinoff cases will presumably be absorbed by the settlement if it holds. There was also a separate case filed on behalf of homebuyers (as opposed to sellers) that didn’t name NAR as a defendant – that one may continue against large brokerages, though its fate is unclear in light of the rule changes rirealtors.org.

On the regulatory front, the DOJ investigation into broker commission practices is ongoing. In fact, in early 2025 the Supreme Court declined to block the DOJ’s probe, meaning federal antitrust officials are free to scrutinize NAR’s policies further reuters.com. The DOJ could potentially bring its own case or require additional changes in the future. For example, one issue is that current regulations (like certain federal loan rules) prohibit financing a buyer agent’s commission through the mortgage nar.realtor – something that might need policy tweaks if buyers are to pay agents directly more often. NAR has been lobbying for clarity so that things like VA loans (which historically barred veterans from paying real estate commissions out-of-pocket) won’t disadvantage buyers in this new landscape nar.realtornar.realtor.

For real estate agents, the important thing is to stay educated and adaptable. If you’re a Realtor®, remember that your Code of Ethics (which you refresh in that NAR ethics class every few years) already calls for transparency and putting clients’ interests first. These new rules simply put that into practice regarding commissions. Make sure you understand your local MLS’s implementation of the changes, update your buyer and seller forms, and clearly communicate with clients. As the dust settles (no pun intended), savvy agents will seize this moment to differentiate themselves by knowledge and professionalism. After all, change is easier to navigate when you’ve done your homework – which is why keeping up with industry news and continuing education for real estate agents is more critical than ever.

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