If you are curious how attorney Mike Ketchmark and his team After winning a landmark $1.8 billion class-action lawsuit over price fixing against the National Association of Realtors, Keller Williams and HomeServices of America, you’re going to love this podcast episode.
It really was a David Vs. Goliath moment that will change the real estate industry forever. Both home buyers and home sellers should benefit from lower commissions for this ruling.
As I wrote in my Real Estate Collusion post, in 2017, I couldn’t believe I was paying 2.5% to a buyer’s agent when she was trying to hit me on my asking price. The commission incentive structure is misaligned.
But my selling agent argued that we would have a hard time getting buyers if we didn’t pay their agents 2.5%. Looked sketchy to me! But I paid an overall commission rate of 4.5% because my son was born in 2017 and I wanted to make life easier.
Maybe I should ask for a partial refund now that Catchmark has proven price fixing and collusion.
Mike Ketchmark’s earlier case
I have a new respect for lawyers who deal with contingency fees. Catchmark and his team don’t charge anything until their clients win. Can you imagine working on a case for years and spending millions of dollars only to lose? Talk about taking big risks for what you believe in!
Before the brokerage case, Ketchmark was best known for a 2002 lawsuit involving pharmacist Robert Courtney. Courtney dispensed 98,000 chemotherapy prescriptions for more than 4,200 cancer patients in the Kansas City area. Representing victims, Ketchmark sued drug maker Eli Lilly and others. He claims they were negligent in not uncovering Courtney’s scheme.
Ketchmark won a $2.2 billion civil judgment against the companies. However, they ultimately settled on just $72.1 million.
Most recently, Ketchmark represented a Kansas City doctor who received an award $26 million In 2021. The doctor claims an ER staffing company fired him after raising concerns about patient safety. Specifically, he took issue with having only one doctor covering both the regular and pediatric ER departments at the hospital where he worked.
My Conversation with Mike Ketchmark, the Attorney Who’s Destroying the Real Estate Cartels
If you own a home and/or rental property, I encourage you to share this episode with everyone you know. The more we can spread the word, the more pressure we will put on the real estate industry to properly align the commission structure.
Finally, if you enjoyed the episode, I’d appreciate a review! It takes hours for you to interview and edit each episode. Subscribe so you never miss a new episode.
Mike shows notes on pricing with catchmarks
- 501(c)(6) nonprofit corporation Avoid paying taxes and government lobbying (4:30)
- Steering is the process by which real estate agents steer their clients away from homes where the commission is not high enough (13:39).
- The real estate industry uses tactics to scare home sellers into paying commission fees. Unlike buying and selling cars, the typical home owner can only sell twice in their lifetime (15:00).
- Why have we allowed prices to be fixed for so long?
- In other countries there is no such thing as a buyer’s agent. Don’t have internet in Missouri?
- Real estate commission takes huge amounts of equity built up by homeowners (19:00)
- Agents train buyers to tell their service is “free.”
- NAR and other real estate brokers fear buyers will pay buyers’ agents (22:20)
- Missouri “Housing Development Commission” Pushed by Housing Advocates – $140,000 < 4% of a $4000,000 home value for married couple, first time buyer, must hold for seven years
- When Mike Thinks Real Estate Commissions Will Start Coming Down Materially (28:10)
- In 10-15 years Mike doesn’t believe there will be buyers agents
- its strength 7th Amendment (37:30) Forming a jury of private citizens to stand up to the most powerful people in real estate.
- Where did the Department of Justice and Anti-Trust Department give this rule? Have they failed us? (38:40)
- The Economics of Being a Trial Lawyer on Contingency Fees (41:46)
- The first bill from expert witnesses is $1.7 million (44:10), then you commit
- Law firm process actually pays after a win (46:45)
- Working together as a family to sustain one another (48:57)
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