MiRealSource, Inc.; Analysis of Agreement Containing Consent Order To Aid Public Comment, 6566-6570 [E7-2305]
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Federal Register / Vol. 72, No. 28 / Monday, February 12, 2007 / Notices
registration information. Additionally,
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Dated: February 5, 2007.
Drusilla Hufford,
Director, Stratospheric Protection Division,
Office of Air and Radiation, U.S.
Environmental Protection Agency.
[FR Doc. E7–2308 Filed 2–9–07; 8:45 am]
BILLING CODE 6560–50–P
FEDERAL HOUSING FINANCE BOARD
Sunshine Act Meeting Notice;
Announcing a Closed Meeting of the
Board of Directors
A closed meeting of the
Board of Directors is scheduled to begin
at 10 a.m. on Wednesday, February 14,
2007.
TIME AND DATE:
Board Room, First Floor, Federal
Housing Finance Board, 1625 Eye Street
NW., Washington DC 20006.
PLACE:
The meeting will be closed to
the public.
STATUS:
MATTERS TO BE CONSIDERED AT THE
MEETING: Periodic Update of
Examination Program Development and
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CONTACT PERSON FOR MORE INFORMATION:
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Shelia Willis, Paralegal Specialist,
Office of General Counsel, at 202–408–
2876 or williss@fhfb.gov.
By the Federal Housing Finance Board.
Dated: February 7, 2007.
Neil R. Crowley,
Acting General Counsel.
[FR Doc. 07–624 Filed 2–7–07; 4:38 pm]
BILLING CODE 6725–01–P
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FEDERAL RESERVE SYSTEM
Formations of, Acquisitions by, and
Mergers of Bank Holding Companies
The companies listed in this notice
have applied to the Board for approval,
pursuant to the Bank Holding Company
Act of 1956 (12 U.S.C. 1841 et seq.)
(BHC Act), Regulation Y (12 CFR Part
225), and all other applicable statutes
and regulations to become a bank
holding company and/or to acquire the
assets or the ownership of, control of, or
the power to vote shares of a bank or
bank holding company and all of the
banks and nonbanking companies
owned by the bank holding company,
including the companies listed below.
The applications listed below, as well
as other related filings required by the
Board, are available for immediate
inspection at the Federal Reserve Bank
indicated. The application also will be
available for inspection at the offices of
the Board of Governors. Interested
persons may express their views in
writing on the standards enumerated in
the BHC Act (12 U.S.C. 1842(c)). If the
proposal also involves the acquisition of
a nonbanking company, the review also
includes whether the acquisition of the
nonbanking company complies with the
standards in section 4 of the BHC Act
(12 U.S.C. 1843). Unless otherwise
noted, nonbanking activities will be
conducted throughout the United States.
Additional information on all bank
holding companies may be obtained
from the National Information Center
website at www.ffiec.gov/nic/.
Unless otherwise noted, comments
regarding each of these applications
must be received at the Reserve Bank
indicated or the offices of the Board of
Governors not later than March 9, 2007.
A. Federal Reserve Bank of Atlanta
(Andre Anderson, Vice President) 1000
Peachtree Street, N.E., Atlanta, Georgia
30309:
1. TIB Financial Corp, Naples,
Florida; to acquire 100 percent of the
voting shares of the Bank of Venice,
Venice, Florida.
2. FMCB Holdings, Inc., Senoia,
Georgia; to acquire 100 percent of the
voting shares of First Choice
Community Bank, Dallas, Georgia (in
organization).
3. FBG Holding Corporation, Tampa,
Florida; to become a bank holding
company by acquiring 100 percent of
the voting shares of Florida Bank Group,
Inc., and thereby indirectly acquire
Bank of St. Petersburg, both of Tampa,
Florida.
4. FBG Holding Corporation, Tampa,
Florida; to acquire 100 percent of the
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voting shares of The Bank of
Tallahassee, Tallahassee, Florida.
B. Federal Reserve Bank of Dallas
(W. Arthur Tribble, Vice President) 2200
North Pearl Street, Dallas, Texas 752012272:
1. First Texas BHC, Fort Worth, Texas;
to become a bank holding company by
acquiring 100 percent of Community
Bank of Texas, National Association,
Grand Prairie, Texas.
2. Farmers and Merchants
Bancshares, Inc., Houston, Texas; to
acquire 100 percent of Texas Premier
Bank, National Association, Brookshire,
Texas.
Board of Governors of the Federal Reserve
System, February 7, 2007.
Robert deV. Frierson,
Deputy Secretary of the Board.
[FR Doc. E7–2377 Filed 2–9–07; 8:45 am]
BILLING CODE 6210–01–S
FEDERAL TRADE COMMISSION
[File No. 061 0266]
MiRealSource, Inc.; Analysis of
Agreement Containing Consent Order
To Aid Public Comment
Federal Trade Commission.
Proposed consent agreement.
AGENCY:
ACTION:
SUMMARY: The consent agreement in this
matter settles alleged violations of
federal law prohibiting unfair or
deceptive acts or practices or unfair
methods of competition. The attached
Analysis to Aid Public Comment
describes both the allegations in the
draft complaint and the terms of the
consent order—embodied in the consent
agreement—that would settle these
allegations.
DATES: Comments must be received on
or before March 7, 2007.
ADDRESSES: Interested parties are
invited to submit written comments.
Comments should refer to
‘‘MiRealSource, Inc., File No. 061
0266,’’ to facilitate the organization of
comments. A comment filed in paper
form should include this reference both
in the text and on the envelope, and
should be mailed or delivered to the
following address: Federal Trade
Commission, Office of the Secretary,
Room 135–H, 600 Pennsylvania
Avenue, NW., Washington, DC 20580.
Comments containing confidential
material must be filed in paper form,
must be clearly labeled ‘‘Confidential,’’
and must comply with Commission
Rule 4.9(c). 16 CFR 4.9(c) (2005).1 The
1 The comment must be accompanied by an
explicit request for confidential treatment,
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Federal Register / Vol. 72, No. 28 / Monday, February 12, 2007 / Notices
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FTC is requesting that any comment
filed in paper form be sent by courier or
overnight service, if possible, because
U.S. postal mail in the Washington area
and at the Commission is subject to
delay due to heightened security
precautions. Comments that do not
contain any nonpublic information may
instead be filed in electronic form as
part of or as an attachment to e-mail
messages directed to the following email box: consentagreement@ftc.gov.
The FTC Act and other laws the
Commission administers permit the
collection of public comments to
consider and use in this proceeding as
appropriate. All timely and responsive
public comments, whether filed in
paper or electronic form, will be
considered by the Commission, and will
be available to the public on the FTC
Web site, to the extent practicable, at
https://www.ftc.gov. As a matter of
discretion, the FTC makes every effort to
remove home contact information for
individuals from the public comments it
receives before placing those comments
on the FTC Web site. More information,
including routine uses permitted by the
Privacy Act, may be found in the FTC’s
privacy policy, at https://www.ftc.gov/
ftc/privacy.htm.
FOR FURTHER INFORMATION CONTACT:
Patrick Roach (202/326–2793), Bureau
of Competition, 600 Pennsylvania
Avenue, NW., Washington, DC 20580.
SUPPLEMENTARY INFORMATION: Pursuant
to section 6(f) of the Federal Trade
Commission Act, 38 Stat. 721, 15 U.S.C.
46(f), and § 2.34 of the Commission
Rules of Practice, 16 CFR 2.34, notice is
hereby given that the above-captioned
consent agreement containing a consent
order to cease and desist, having been
filed with and accepted, subject to final
approval, by the Commission, has been
placed on the public record for a period
of thirty (30) days. The following
Analysis to Aid Public Comment
describes the terms of the consent
agreement, and the allegations in the
complaint. An electronic copy of the
full text of the consent agreement
package can be obtained from the FTC
Home Page (for February 5, 2007), on
the World Wide Web, at https://
www.ftc.gov/os/2007/02/index.htm. A
paper copy can be obtained from the
FTC Public Reference Room, Room 130–
H, 600 Pennsylvania Avenue, NW.,
Washington, DC 20580, either in person
or by calling (202) 326–2222.
including the factual and legal basis for the request,
and must identify the specific portions of the
comment to be withheld from the public record.
The request will be granted or denied by the
Commission’s General Counsel, consistent with
applicable law and the public interest. See
Commission Rule 4.9(c), 16 CFR 4.9(c).
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Public comments are invited, and may
be filed with the Commission in either
paper or electronic form. All comments
should be filed as prescribed in the
ADDRESSES section above, and must be
received on or before the date specified
in the DATES section.
Analysis of Agreement Containing
Consent Order To Aid Public Comment
The Federal Trade Commission has
accepted for public comment an
agreement containing consent order
with MiRealSource, Inc.
(‘‘MiRealSource’’ or ‘‘Respondent’’).
Respondent is a corporation owned by
real estate brokers in Southeastern
Michigan that operates a multiple listing
service (‘‘MLS’’) designed to facilitate
real estate transactions. The agreement
settles charges that Respondent violated
Section 5 of the Federal Trade
Commission Act, 15 U.S.C. 45, through
particular acts and practices of the MLS.
The proposed consent order has been
placed on the public record for 30 days
to receive comments from interested
persons. Comments received during this
period will become part of the public
record. After 30 days, the Commission
will review the agreement and the
comments received, and will decide
whether it should withdraw from the
agreement or make the proposed order
final.
The purpose of this analysis is to
facilitate comment on the proposed
consent order. This analysis does not
constitute an official interpretation of
the agreement and proposed order, and
does not modify their terms in any way.
Further, the proposed consent order has
been entered into for settlement
purposes only, and does not constitute
an admission by Respondent that it
violated the law or that the facts alleged
in the complaint (other than
jurisdictional facts) are true.
I. The Respondent
MiRealSource is a Michigan
corporation. Its shareholders are real
estate brokers doing business in
Southeastern Michigan, and they are
generally referred to as ‘‘members’’ of
the Respondent. MiRealSource has
approximately 7,000 members, and
these members supply real estate
brokerage services to home sellers in
Southeastern Michigan and to
prospective purchasers seeking homes
in that area. One of the primary tools
utilized by members to carry out their
business efficiently is the MiRealSource
MLS. This service facilitates the process
of matching sellers and buyers for a
large number of individual properties. It
functions as a clearinghouse through
which members regularly and
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systematically exchange information on
property listings.
II. Industry Background
A Multiple Listing Service, or ‘‘MLS,’’
is a cooperative venture by which real
estate brokers serving a common local
market area submit their listings to a
central service, which in turn
distributes the information, for the
purpose of fostering cooperation among
brokers in real estate transactions. The
MLS facilitates transactions by putting
together a home seller, who contracts
with a broker who is a member of the
MLS, with prospective buyers, who may
be working with other brokers who are
also members of the MLS. Typically, the
MLS rules establish criteria for
membership, including the requirement
that brokers and agents must be licensed
by the applicable state regulatory agency
to engage in real estate brokerage
services.
Prior to the late 1990s, the listings on
an MLS generally were directly
accessible only to real estate brokers
who were members of a local MLS. At
that time, the MLS listings typically
were made available through books or
dedicated computer terminals, and
generally could only be accessed by the
public by physically visiting a broker’s
office or by receiving a fax or hand
delivery of selected listings from a
broker.
Information from an MLS is now
typically available to the general public
not only through the offices of real
estate brokers who are MLS members,
but also through three principal
categories of internet Web sites. First,
information concerning many MLS
listings is available through
Realtor.com, a national Web site run by
the National Association of Realtors
(‘‘NAR’’). Realtor.com contains listing
information from many local MLS
systems around the country and is the
largest and most-used internet real
estate Web site. Second, information
concerning MLS listings is often made
available through a local MLS-affiliated
Web site. Third, information concerning
MLS listings is often made available on
the internet sites of various real estate
brokers, who choose to provide these
Web sites as a way of promoting their
brokerage services to potential clients
(home buyers and sellers). Most of these
various Web sites receive information
from an MLS pursuant to a procedure
known as Internet Data Exchange
(‘‘IDX’’), which is typically governed by
MLS policies. The IDX policies allow
operators of approved Web sites to
display MLS active listing information
to the public.
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Federal Register / Vol. 72, No. 28 / Monday, February 12, 2007 / Notices
Today the internet plays a crucial role
in real estate sales. According to a 2006
survey by the National Association of
Realtors (‘‘NAR’’), 80 percent of home
buyers used the internet to assist in
their home search, with 59 percent
reporting frequent internet searches.
Twenty-four percent of respondents first
learned about the home they selected
from the internet, the second most
common means behind learning about a
home from a real estate agent (36
percent).2 In all, 73 percent of home
buyers found the internet to be a ‘‘very
useful’’ source of information, and a
total of 98 percent found the internet to
be either ‘‘very useful’’ or ‘‘somewhat
useful.’’ 3 Moreover, the NAR Survey
makes clear that the overwhelming
majority of Web sites used nationally in
searching for homes contain listing
information that is provided by local
MLS systems.4
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A. Types of Real Estate Brokerage
Professionals
A typical real estate transaction
involves two real estate brokers. These
are commonly referred to as a ‘‘listing
broker’’ and a ‘‘selling broker.’’ The
listing broker is hired by the seller of the
property to locate an appropriate buyer.
The seller and the listing broker agree
upon compensation, which is
determined by written agreement
negotiated between the seller and the
listing broker. In a common traditional
listing agreement, the listing broker
receives compensation in the form of a
commission, which is typically a
percentage of the sales price of the
property, payable if and when the
property is sold. In such a traditional
listing agreement, the listing broker
agrees to provide a package of real estate
brokerage services, including promoting
the listing through the MLS and on the
internet, providing advice to the seller
regarding pricing and presentation,
fielding all calls and requests to show
the property, supplying a lock-box so
that potential buyers can see the house
with their agents, running open houses
to show the house to potential buyers,
reviewing offers, negotiating with
buyers or their agents on offers, assisting
with home inspections and other
arrangements once a contract for sale is
executed, and attending the closing of
the transaction.
The other broker involved in a typical
transaction is commonly referred to as
2 E.g., Paul C. Bishop, Harika Bickicioglu, and
Shonda D. Hightower, The 2006 National
Association of Realtors Profile of Home Buyers and
Sellers (hereinafter, ‘‘NAR Study’’) at 3–3, 3–4, 3–
6.
3 Id. at 3–5.
4 NAR Study at 3–19.
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the selling broker. This selling broker
will identify and discuss the properties
that may be of interest to the buyer,
accompany the buyer to see various
properties, try to arrange a transaction
between buyer and seller, assist the
buyer in negotiating the contract, and
help in further steps necessary to close
the transaction. In a traditional
transaction, the listing broker offers the
selling broker a fixed commission, to be
paid from the listing broker’s
commission when and if the property is
sold. Real estate brokers typically do not
specialize as only listing brokers or
selling brokers, but often function in
either role depending on the particular
transaction.
B. Types of Real Estate Listings
The relationship between the listing
broker and the seller of the property is
established by agreement. The two most
common types of agreements governing
listings are Exclusive Right to Sell
Listings and Exclusive Agency Listings.
An Exclusive Right to Sell Listing is the
traditional listing agreement, pursuant
to which the property owner appoints a
real estate broker as his or her exclusive
agent for a designated period of time, to
sell the property on the owner’s stated
terms, and agrees to pay the listing
broker a commission if and when the
property is sold, whether the buyer of
the property is secured by the listing
broker, the owner or another broker.
An Exclusive Agency Listing is a
listing agreement pursuant to which the
listing broker acts as an exclusive agent
of the property owner or principal in the
sale of a property, but under which the
property owner or principal reserves a
right to sell the property without
assistance of the listing broker, in which
case the listing broker is paid a reduced
or no commission when the property is
sold.
Some real estate brokers have
attempted to offer services to home
sellers on something other than the
traditional full-service basis. Many of
these brokers, often for a flat fee paid at
the inception of the listing contract and
not contingent on whether the home
sells during the term of that contract,
will offer sellers access to the MLS’s
information-sharing function as well as
a promise that their listing will appear
on the most popular real estate Web
sites. Under such arrangements, the
listing broker does not offer additional
real estate brokerage services as part of
the flat fee package, but allows sellers to
purchase additional services if sellers so
desire. These non-traditional
arrangements often are structured using
Exclusive Agency Listing contracts.
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There is a third type of real estate
transaction that does not involve a real
estate broker or the services of the MLS,
and it is known as a ‘‘For Sale By
Owner’’ or ‘‘FSBO’’ transaction. With a
FSBO transaction, a home owner will
attempt to sell a house without the
involvement of any real estate broker
and without paying any compensation
to such a broker, by advertising the
availability of the home through
traditional advertising mechanisms
(such as a newspaper) or FSBO-specific
Web sites.
There are two critical distinctions
between an Exclusive Agency Listing
and a FSBO for the purpose of this
analysis. First, the Exclusive Agency
Listing employs a listing broker for
access to the MLS and popular Web
sites providing MLS listing information
open to the public; a FSBO transaction
does not. Second, an Exclusive Agency
Listing sets terms of compensation to be
paid to a selling broker, while a FSBO
transaction often does not.
III. The Conduct Addressed by the
Proposed Consent Order
The complaint in this matter, issued
on October 10, 2006,5 alleges that
MiRealSource has violated the FTC Act
by adopting rules or policies that limit
the publication and marketing of certain
sellers’ properties, but not others, based
solely on the terms of their respective
listing contracts. The complaint alleges
that Respondent favored Exclusive Right
to Sell Listings and disfavored Exclusive
Agency Listings through, among other
things, the adoption of a rule excluding
the latter listings entirely from the MLS.
The allegations explain that
Respondent also adopted a series of
further rules to stifle competition from
real estate brokers using alternative
business models to provide brokerage
services in Southeastern Michigan.
These rules include: (1) The ‘‘Web Site
Policy,’’ which limits the publication of
certain residential real estate listings on
popular real estate Web sites; (2) the
‘‘Listing Broker Policy,’’ which requires
a Listing Broker to perform a minimum
set of services; (3) the ‘‘Physical Office
Policy, which requires each member to
have an office in the state of Michigan;
(4) the ‘‘FSBO Policy,’’which restricts
how and where home sellers can
advertise and market their homes; and
(5) the ‘‘Co-Mingling Policy,’’ which (for
a time) restricted MiRealSource listing
information from being searched on
public Web sites along side listing
information from other sources.
5 See https://www.ftc.gov/os/adjpro/d9321/
061012admincomplaint.pdf.
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Such rules limit the acceptance,
publication, and marketing of certain
residential real estate listing contracts,
thereby limiting home sellers’ ability to
choose a listing type that best serves
their specific needs. The complaint
alleges that the conduct was collusive
and exclusionary, because in agreeing to
keep non-traditional listings off the MLS
and from public Web sites, the brokers
enacting the rules were, in effect,
agreeing among themselves to limit the
manner in which they compete with one
another, and withholding valuable
benefits of the MLS from real estate
brokers who did not go along. In
addition, the complaint alleges that
MiRealSource actively enforced the
anticompetitive rules and policies
through violation letters to members
and substantial fines.
Some of the conduct at issue in this
matter also is similar to the conduct
addressed by the Commission in its
recent consent orders involving real
estate boards and associations operating
MLSs in Texas, New Hampshire, New
Jersey, Virginia, Wisconsin and
Colorado.6 As in those matters, certain
rules or policies of Respondent
challenged in the complaint preclude
information about properties from being
made available on popular real estate
Web sites because the listing contracts
do not follow the traditional format
approved by the MLS. These rules or
policies prevent properties with nontraditional listing contracts from being
displayed on a broad range of public
Web sites, including the national
‘‘Realtor.com’’ web site operated by the
National Association of Realtors, the
local web site operated by
MiRealSource, and individual members’
Web sites.
A. The Respondent Has Market Power
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MiRealSource serves residential real
estate brokers in Southeastern Michigan.
These professionals compete with one
another to provide residential real estate
brokerage services to consumers.
6 In the Matter of Austin Bd. of Realtors, Docket
No. C–4167 (Final Approval, Aug. 29, 2006); In the
Matter of Northern New England Real Estate
Network, Inc., Docket No. C–4175 (Final Approval,
Nov. 22, 2006); In the Matter of Monmouth County
Association of Realtors, Inc., Docket No. C–4176
(Final Approval, Nov. 22, 2006); In the Matter of
Williamsburg Area Association of Realtors, Inc.,
Docket No. C–4177 (Final Approval, Nov. 22, 2006);
In the Matter of Realtors Association of Northeast
Wisconsin, Inc., Docket No. C–4178 (Final
Approval, Nov. 22, 2006); In the Matter of
Information and Real Estate Services, LLC, Docket
No. C–4179 (Final Approval, Nov. 22, 2006). The
ABOR consent order was published with an
accompanying Analysis To Aid Public Comment at
71 Fed. Reg. 41023 (July 19, 2006). The other five
consent orders were published at 71 Fed. Reg.
61474 (October 12, 2006).
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Membership in the MiRealSource MLS
is necessary for a broker to provide
effective residential real estate brokerage
services to sellers and buyers of real
property in this area.7 By virtue of broad
industry participation and control over
a key input, MiRealSource has market
power in the provision of residential
real estate brokerage services to sellers
and buyers of real property in the
MiRealSource Service Area.
B. Respondent’s Conduct
Non-traditional forms of listing
contracts, including Exclusive Agency
Listings, are used by listing brokers to
offer lower-cost real estate services to
consumers. The series of rules and
policies adopted by Respondent were
joint action by a group of competitors to
withhold distribution of listing
information from rivals who did not
contract with their brokerage service
customers in a way that the group
wished. This type of conduct was
condemned by the Commission 20 years
ago. In the 1980s and 1990s, several
local MLS boards banned Exclusive
Agency Listings from the MLS entirely.
The Commission investigated and
issued complaints against these
exclusionary practices, obtaining several
consent orders.8 The complaint alleges
that, in addition to following these past
practices, MiRealSource also extended
its exclusionary rules to the more
modern method of distributing listing
information publicly via the internet.
C. Competitive Effects of the
Respondent’s Rules and Policies
The MiRealSource rules and policies
have prevented its members from
offering or accepting Exclusive Agency
Listings. Thus, the rules impede the
provision of unbundled brokerage
services, and may make it more difficult
and costly for home sellers to market
7 As noted, the MLS provides valuable services
for a broker assisting a seller as a listing broker, by
offering a means of publicizing the property to other
brokers and the public. For a broker assisting a
buyer, it also offers unique and valuable services,
including detailed information that is not shown on
public web sites, which can help with house
showings and otherwise facilitate home selections.
8 See, e.g., In the Matter of Port Washington Real
Estate Bd., Inc., 120 F.T.C. 882 (1995); In the Matter
of United Real Estate Brokers of Rockland, Ltd., 116
F.T.C. 972 (1993); In the Matter of Am. Indus. Real
Estate Assoc., Docket No. C–3449, 1993 WL
13009648 (F.T.C. Jul. 6, 1993); In the Matter of
Puget Sound Multiple Listing Serv., Docket No. C–
3390 (F.T.C. Aug. 2, 1990); In the Matter of
Bellingham-Whatcom County Multiple Listing
Bureau, Docket No. C–3299 (F.T.C. Aug. 2, 1990);
In the Matter of Metro MLS, Inc., Docket No. C–
3286, 1990 WL 10012611 (F.T.C. Apr. 18, 1990); In
the Matter of Multiple Listing Serv. of the Greater
Michigan City Area, Inc., 106 F.T.C. 95 (1985); In
the Matter of Orange County Bd. of Realtors, Inc.,
106 F.T.C. 88 (1985).
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their homes. The Respondent’s rules
and policies have caused some brokers
to exit from the real estate business in
Southeastern Michigan, or to refrain
from offering non-traditional brokerage
services in that market or to not enter
at all. Furthermore, the rules have
caused home sellers to switch away
from Exclusive Agency Listings to other
forms of listing agreements.
By preventing Exclusive Agency
Listings from being included in the MLS
and transmitted to public-access real
estate Web sites, the MiRealSource rules
and policies have adverse effects on
home sellers and home buyers. When
home sellers switch to full service
listing agreements from Exclusive
Agency Listings that often offer lowercost real estate services to consumers,
the sellers may purchase services that
they would not otherwise buy. This, in
turn, may increase the commission costs
to consumers of real estate brokerage
services. In particular, the rules deny
home sellers choices for marketing their
homes and deny home buyers the
chance to use the internet easily to see
all of the houses listed by real estate
brokers in the area, making their search
less efficient.
D. There Is No Competitive Efficiency
Associated With the Web Site Policy
The Respondent’s rules at issue here
advance no legitimate procompetitive
purpose. As a theoretical matter, if
buyers and sellers could avail
themselves of an MLS system and carry
out real estate transactions without
compensating any of its broker
members, an MLS might be concerned
that those buyers and sellers were freeriding on the investment that brokers
have made in the MLS and adopt rules
to address that free-riding. But this
theoretical concern does not justify the
rules or policies adopted by
MiRealSource. Exclusive Agency
Listings are not a credible means for
home buyers or sellers to bypass the use
of the brokerage services that the MLS
was created to promote, because a
listing broker is always involved in an
Exclusive Agency Listing, and other
provisions in the MiRealSource rules
ensure that a selling broker—a broker
who finds a buyer for the property—is
compensated for the brokerage service
he or she provides.
Under existing MLS rules that apply
to any form of listing agreement, the
listing broker must ensure that the home
seller pays compensation to the
cooperating selling broker (if there is
one), and the listing broker may be
liable himself for a lost commission if
the home seller fails to pay a selling
broker who was the procuring cause of
E:\FR\FM\12FEN1.SGM
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6570
Federal Register / Vol. 72, No. 28 / Monday, February 12, 2007 / Notices
sroberts on PROD1PC70 with NOTICES
a completed property sale. The
possibility of sellers or buyers using the
MLS but bypassing brokerage services is
already addressed effectively by the
Respondent’s existing rules that do not
distinguish between forms of listing
contracts, and does not justify the series
of exclusionary rules and policies
adopted by MiRealSource. It is possible,
of course, that a buyer of an Exclusive
Agency Listing may make the purchase
without using a selling broker, but this
is true for traditional Exclusive Right to
Sell Listings as well.
IV. The Proposed Consent Order
The proposed order is designed to
ensure that the Respondent does not
misuse its market power, while
preserving the procompetitive
incentives of members to contribute to
the MLS.
The proposed order prohibits
MiRealSource from adopting or
enforcing any rules or policies that deny
or limit the ability of MLS members to
enter into Exclusive Agency Listings, or
any other lawful listing agreements,
with sellers of properties. More
specifically, the proposed order
prohibits MiRealSource from preventing
its members from offering or accepting
Exclusive Agency Listings or other
lawful listing agreements; cooperating
with Listing Brokers or agents that offer
or accept Exclusive Agency Listings or
other lawful listing agreements;
publishing Exclusive Agency Listings or
other lawful listing agreements on the
MLS and approved Web sites;
publishing their information concerning
listings on public real estate Web sites,
including but not limited to https://
www.FSBO.com; requiring members to
have a physical office; and offering
unbundled real estate brokerage
services, including but not limited to
requiring MiRealSource Shareholders to
provide a minimum set of real estate
brokerage services. The proposed order
also prohibits MiRealSource from
denying or restricting the services of the
MLS to Exclusive Agency Listings or
other lawful listings in any way that
such services of the MLS are not denied
or restricted to Exclusive Right to Sell
Listings; or treating Exclusive Agency
Listings, or any other lawful listings, in
a less advantageous manner than
Exclusive Right to Sell Listings,
including but not limited to, any policy,
rule or practice pertaining to the
transmission, downloading, or
displaying of information pertaining to
such listings.
In addition to these substantive
provisions, the proposed order states
that, within forty-five days after it
becomes final, Respondent shall have
VerDate Aug<31>2005
19:52 Feb 09, 2007
Jkt 211001
conformed its rules to the substantive
provisions of the order. Respondent is
further required to notify its members of
the applicable order through its usual
business communications and its Web
site. The proposed order requires
notification to the Commission of
changes in the respondent’s structure,
and periodic filings of written reports
concerning compliance. The relief in the
proposed consent order ensures that the
Respondent cannot revert to the old
rules or policies, or engage in future
variations of the challenged conduct.
The proposed order applies to
MiRealSource and entities it owns or
controls, including its respective MLS
and any affiliated Web site it operates.
The order does not prohibit members, or
other independent persons or entities
that receive listing information from
Respondent, from making independent
decisions concerning the use or display
of such listing information on member
or third-party Web sites, consistent with
any contractual obligations to
Respondent.
The proposed order will expire in 10
years.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. E7–2305 Filed 2–9–07; 8:45 am]
BILLING CODE 6750–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Disease Control and
Prevention
[60Day-07–0527]
Proposed Data Collections Submitted
for Public Comment and
Recommendations
In compliance with the requirement
of Section 3506(c)(2)(A) of the
Paperwork Reduction Act of 1995 for
opportunity for public comment on
proposed data collection projects, the
Centers for Disease Control and
Prevention (CDC) will publish periodic
summaries of proposed projects. To
request more information on the
proposed projects or to obtain a copy of
the data collection plans and
instruments, call 404–639–5960 or send
comments to Joan F. Karr, CDC Reports
Clearance Officer, 1600 Clifton Road,
MS–D74, Atlanta, GA 30333 or send an
email to omb@cdc.gov.
Comments are invited on: (a) Whether
the proposed collection of information
is necessary for the proper performance
of the functions of the agency, including
whether the information shall have
PO 00000
Frm 00054
Fmt 4703
Sfmt 4703
practical utility; (b) the accuracy of the
agency’s estimate of the burden of the
proposed collection of information; (c)
ways to enhance the quality, utility, and
clarity of the information to be
collected; and (d) ways to minimize the
burden of the collection of information
on respondents, including through the
use of automated collection techniques
or other forms of information
technology. Written comments should
be received within 60 days of this
notice.
Proposed Project
Human Exposure to Cyanobacterial
Toxins in Water (OMB No. 0920–
0527)—Reinstatement—National Center
for Environmental Health (NCEH),
Centers for Disease Control and
Prevention (CDC).
Background and Brief Description
Cyanobacteria (blue-green algae) can
be found in terrestrial, fresh, brackish,
or marine water environments. Some
species of cyanobacteria produce toxins
that may cause acute or chronic
illnesses (including neurotoxicity,
hepatotoxicity, and skin irritation) in
humans and animals (including other
mammals, fish, and birds). A number of
human health effects, including
gastroenteritis, respiratory effects, skin
irritations, allergic responses, and liver
damage, are associated with the
ingestion of or contact with water
containing cyanobacterial blooms.
Although the balance of evidence, in
conjunction with data from laboratory
animal research, suggests that
cyanobacterial toxins are responsible for
a range of human health effects, there
have been few epidemiologic studies of
this association.
During August 2006, we conducted
our first study to assess exposure to
microcystins in recreational waters with
a bloom of Microcystis aeruginosa. We
recruited 104 people who gave informed
consent to participate. Ninety seven
people did their recreational activities
on Lake 1, which had a confirmed M.
aeruginosa bloom, and 7 others did their
activities on Lake 2, which had no
bloom. Study participants completed a
pre-activity questionnaire, a postactivity questionnaire, provided a 10-ml
blood sample, and completed a
telephone symptom survey 7–10 days
after exposure. The concentrations of
microcystins in Lake 1 ranged from 2 to
5 ug/L and in Lake 2 were all below the
limit of detection (LOD). When we
designed the study, we calculated that
a person exposed to recreationallygenerated aerosols from water
containing 10 ug/L of microcystins
should have levels of microcystins in
E:\FR\FM\12FEN1.SGM
12FEN1
]]>Agencies
[Federal Register Volume 72, Number 28 (Monday, February 12, 2007)]
[Notices]
[Pages 6566-6570]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-2305]
=======================================================================
-----------------------------------------------------------------------
FEDERAL TRADE COMMISSION
[File No. 061 0266]
MiRealSource, Inc.; Analysis of Agreement Containing Consent
Order To Aid Public Comment
AGENCY: Federal Trade Commission.
ACTION: Proposed consent agreement.
-----------------------------------------------------------------------
SUMMARY: The consent agreement in this matter settles alleged
violations of federal law prohibiting unfair or deceptive acts or
practices or unfair methods of competition. The attached Analysis to
Aid Public Comment describes both the allegations in the draft
complaint and the terms of the consent order--embodied in the consent
agreement--that would settle these allegations.
DATES: Comments must be received on or before March 7, 2007.
ADDRESSES: Interested parties are invited to submit written comments.
Comments should refer to ``MiRealSource, Inc., File No. 061 0266,'' to
facilitate the organization of comments. A comment filed in paper form
should include this reference both in the text and on the envelope, and
should be mailed or delivered to the following address: Federal Trade
Commission, Office of the Secretary, Room 135-H, 600 Pennsylvania
Avenue, NW., Washington, DC 20580. Comments containing confidential
material must be filed in paper form, must be clearly labeled
``Confidential,'' and must comply with Commission Rule 4.9(c). 16 CFR
4.9(c) (2005).\1\ The
[[Page 6567]]
FTC is requesting that any comment filed in paper form be sent by
courier or overnight service, if possible, because U.S. postal mail in
the Washington area and at the Commission is subject to delay due to
heightened security precautions. Comments that do not contain any
nonpublic information may instead be filed in electronic form as part
of or as an attachment to e-mail messages directed to the following e-
mail box: consentagreement@ftc.gov.
---------------------------------------------------------------------------
\1\ The comment must be accompanied by an explicit request for
confidential treatment, including the factual and legal basis for
the request, and must identify the specific portions of the comment
to be withheld from the public record. The request will be granted
or denied by the Commission's General Counsel, consistent with
applicable law and the public interest. See Commission Rule 4.9(c),
16 CFR 4.9(c).
---------------------------------------------------------------------------
The FTC Act and other laws the Commission administers permit the
collection of public comments to consider and use in this proceeding as
appropriate. All timely and responsive public comments, whether filed
in paper or electronic form, will be considered by the Commission, and
will be available to the public on the FTC Web site, to the extent
practicable, at https://www.ftc.gov. As a matter of discretion, the FTC
makes every effort to remove home contact information for individuals
from the public comments it receives before placing those comments on
the FTC Web site. More information, including routine uses permitted by
the Privacy Act, may be found in the FTC's privacy policy, at https://
www.ftc.gov/ftc/privacy.htm.
FOR FURTHER INFORMATION CONTACT: Patrick Roach (202/326-2793), Bureau
of Competition, 600 Pennsylvania Avenue, NW., Washington, DC 20580.
SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal
Trade Commission Act, 38 Stat. 721, 15 U.S.C. 46(f), and Sec. 2.34 of
the Commission Rules of Practice, 16 CFR 2.34, notice is hereby given
that the above-captioned consent agreement containing a consent order
to cease and desist, having been filed with and accepted, subject to
final approval, by the Commission, has been placed on the public record
for a period of thirty (30) days. The following Analysis to Aid Public
Comment describes the terms of the consent agreement, and the
allegations in the complaint. An electronic copy of the full text of
the consent agreement package can be obtained from the FTC Home Page
(for February 5, 2007), on the World Wide Web, at https://www.ftc.gov/
os/2007/02/index.htm. A paper copy can be obtained from the FTC Public
Reference Room, Room 130-H, 600 Pennsylvania Avenue, NW., Washington,
DC 20580, either in person or by calling (202) 326-2222.
Public comments are invited, and may be filed with the Commission
in either paper or electronic form. All comments should be filed as
prescribed in the ADDRESSES section above, and must be received on or
before the date specified in the DATES section.
Analysis of Agreement Containing Consent Order To Aid Public Comment
The Federal Trade Commission has accepted for public comment an
agreement containing consent order with MiRealSource, Inc.
(``MiRealSource'' or ``Respondent''). Respondent is a corporation owned
by real estate brokers in Southeastern Michigan that operates a
multiple listing service (``MLS'') designed to facilitate real estate
transactions. The agreement settles charges that Respondent violated
Section 5 of the Federal Trade Commission Act, 15 U.S.C. 45, through
particular acts and practices of the MLS. The proposed consent order
has been placed on the public record for 30 days to receive comments
from interested persons. Comments received during this period will
become part of the public record. After 30 days, the Commission will
review the agreement and the comments received, and will decide whether
it should withdraw from the agreement or make the proposed order final.
The purpose of this analysis is to facilitate comment on the
proposed consent order. This analysis does not constitute an official
interpretation of the agreement and proposed order, and does not modify
their terms in any way. Further, the proposed consent order has been
entered into for settlement purposes only, and does not constitute an
admission by Respondent that it violated the law or that the facts
alleged in the complaint (other than jurisdictional facts) are true.
I. The Respondent
MiRealSource is a Michigan corporation. Its shareholders are real
estate brokers doing business in Southeastern Michigan, and they are
generally referred to as ``members'' of the Respondent. MiRealSource
has approximately 7,000 members, and these members supply real estate
brokerage services to home sellers in Southeastern Michigan and to
prospective purchasers seeking homes in that area. One of the primary
tools utilized by members to carry out their business efficiently is
the MiRealSource MLS. This service facilitates the process of matching
sellers and buyers for a large number of individual properties. It
functions as a clearinghouse through which members regularly and
systematically exchange information on property listings.
II. Industry Background
A Multiple Listing Service, or ``MLS,'' is a cooperative venture by
which real estate brokers serving a common local market area submit
their listings to a central service, which in turn distributes the
information, for the purpose of fostering cooperation among brokers in
real estate transactions. The MLS facilitates transactions by putting
together a home seller, who contracts with a broker who is a member of
the MLS, with prospective buyers, who may be working with other brokers
who are also members of the MLS. Typically, the MLS rules establish
criteria for membership, including the requirement that brokers and
agents must be licensed by the applicable state regulatory agency to
engage in real estate brokerage services.
Prior to the late 1990s, the listings on an MLS generally were
directly accessible only to real estate brokers who were members of a
local MLS. At that time, the MLS listings typically were made available
through books or dedicated computer terminals, and generally could only
be accessed by the public by physically visiting a broker's office or
by receiving a fax or hand delivery of selected listings from a broker.
Information from an MLS is now typically available to the general
public not only through the offices of real estate brokers who are MLS
members, but also through three principal categories of internet Web
sites. First, information concerning many MLS listings is available
through Realtor.com, a national Web site run by the National
Association of Realtors (``NAR''). Realtor.com contains listing
information from many local MLS systems around the country and is the
largest and most-used internet real estate Web site. Second,
information concerning MLS listings is often made available through a
local MLS-affiliated Web site. Third, information concerning MLS
listings is often made available on the internet sites of various real
estate brokers, who choose to provide these Web sites as a way of
promoting their brokerage services to potential clients (home buyers
and sellers). Most of these various Web sites receive information from
an MLS pursuant to a procedure known as Internet Data Exchange
(``IDX''), which is typically governed by MLS policies. The IDX
policies allow operators of approved Web sites to display MLS active
listing information to the public.
[[Page 6568]]
Today the internet plays a crucial role in real estate sales.
According to a 2006 survey by the National Association of Realtors
(``NAR''), 80 percent of home buyers used the internet to assist in
their home search, with 59 percent reporting frequent internet
searches. Twenty-four percent of respondents first learned about the
home they selected from the internet, the second most common means
behind learning about a home from a real estate agent (36 percent).\2\
In all, 73 percent of home buyers found the internet to be a ``very
useful'' source of information, and a total of 98 percent found the
internet to be either ``very useful'' or ``somewhat useful.'' \3\
Moreover, the NAR Survey makes clear that the overwhelming majority of
Web sites used nationally in searching for homes contain listing
information that is provided by local MLS systems.\4\
---------------------------------------------------------------------------
\2\ E.g., Paul C. Bishop, Harika Bickicioglu, and Shonda D.
Hightower, The 2006 National Association of Realtors Profile of Home
Buyers and Sellers (hereinafter, ``NAR Study'') at 3-3, 3-4, 3-6.
\3\ Id. at 3-5.
\4\ NAR Study at 3-19.
---------------------------------------------------------------------------
A. Types of Real Estate Brokerage Professionals
A typical real estate transaction involves two real estate brokers.
These are commonly referred to as a ``listing broker'' and a ``selling
broker.'' The listing broker is hired by the seller of the property to
locate an appropriate buyer. The seller and the listing broker agree
upon compensation, which is determined by written agreement negotiated
between the seller and the listing broker. In a common traditional
listing agreement, the listing broker receives compensation in the form
of a commission, which is typically a percentage of the sales price of
the property, payable if and when the property is sold. In such a
traditional listing agreement, the listing broker agrees to provide a
package of real estate brokerage services, including promoting the
listing through the MLS and on the internet, providing advice to the
seller regarding pricing and presentation, fielding all calls and
requests to show the property, supplying a lock-box so that potential
buyers can see the house with their agents, running open houses to show
the house to potential buyers, reviewing offers, negotiating with
buyers or their agents on offers, assisting with home inspections and
other arrangements once a contract for sale is executed, and attending
the closing of the transaction.
The other broker involved in a typical transaction is commonly
referred to as the selling broker. This selling broker will identify
and discuss the properties that may be of interest to the buyer,
accompany the buyer to see various properties, try to arrange a
transaction between buyer and seller, assist the buyer in negotiating
the contract, and help in further steps necessary to close the
transaction. In a traditional transaction, the listing broker offers
the selling broker a fixed commission, to be paid from the listing
broker's commission when and if the property is sold. Real estate
brokers typically do not specialize as only listing brokers or selling
brokers, but often function in either role depending on the particular
transaction.
B. Types of Real Estate Listings
The relationship between the listing broker and the seller of the
property is established by agreement. The two most common types of
agreements governing listings are Exclusive Right to Sell Listings and
Exclusive Agency Listings. An Exclusive Right to Sell Listing is the
traditional listing agreement, pursuant to which the property owner
appoints a real estate broker as his or her exclusive agent for a
designated period of time, to sell the property on the owner's stated
terms, and agrees to pay the listing broker a commission if and when
the property is sold, whether the buyer of the property is secured by
the listing broker, the owner or another broker.
An Exclusive Agency Listing is a listing agreement pursuant to
which the listing broker acts as an exclusive agent of the property
owner or principal in the sale of a property, but under which the
property owner or principal reserves a right to sell the property
without assistance of the listing broker, in which case the listing
broker is paid a reduced or no commission when the property is sold.
Some real estate brokers have attempted to offer services to home
sellers on something other than the traditional full-service basis.
Many of these brokers, often for a flat fee paid at the inception of
the listing contract and not contingent on whether the home sells
during the term of that contract, will offer sellers access to the
MLS's information-sharing function as well as a promise that their
listing will appear on the most popular real estate Web sites. Under
such arrangements, the listing broker does not offer additional real
estate brokerage services as part of the flat fee package, but allows
sellers to purchase additional services if sellers so desire. These
non-traditional arrangements often are structured using Exclusive
Agency Listing contracts.
There is a third type of real estate transaction that does not
involve a real estate broker or the services of the MLS, and it is
known as a ``For Sale By Owner'' or ``FSBO'' transaction. With a FSBO
transaction, a home owner will attempt to sell a house without the
involvement of any real estate broker and without paying any
compensation to such a broker, by advertising the availability of the
home through traditional advertising mechanisms (such as a newspaper)
or FSBO-specific Web sites.
There are two critical distinctions between an Exclusive Agency
Listing and a FSBO for the purpose of this analysis. First, the
Exclusive Agency Listing employs a listing broker for access to the MLS
and popular Web sites providing MLS listing information open to the
public; a FSBO transaction does not. Second, an Exclusive Agency
Listing sets terms of compensation to be paid to a selling broker,
while a FSBO transaction often does not.
III. The Conduct Addressed by the Proposed Consent Order
The complaint in this matter, issued on October 10, 2006,\5\
alleges that MiRealSource has violated the FTC Act by adopting rules or
policies that limit the publication and marketing of certain sellers'
properties, but not others, based solely on the terms of their
respective listing contracts. The complaint alleges that Respondent
favored Exclusive Right to Sell Listings and disfavored Exclusive
Agency Listings through, among other things, the adoption of a rule
excluding the latter listings entirely from the MLS.
---------------------------------------------------------------------------
\5\ See https://www.ftc.gov/os/adjpro/d9321/
061012admincomplaint.pdf.
---------------------------------------------------------------------------
The allegations explain that Respondent also adopted a series of
further rules to stifle competition from real estate brokers using
alternative business models to provide brokerage services in
Southeastern Michigan. These rules include: (1) The ``Web Site
Policy,'' which limits the publication of certain residential real
estate listings on popular real estate Web sites; (2) the ``Listing
Broker Policy,'' which requires a Listing Broker to perform a minimum
set of services; (3) the ``Physical Office Policy, which requires each
member to have an office in the state of Michigan; (4) the ``FSBO
Policy,''which restricts how and where home sellers can advertise and
market their homes; and (5) the ``Co-Mingling Policy,'' which (for a
time) restricted MiRealSource listing information from being searched
on public Web sites along side listing information from other sources.
[[Page 6569]]
Such rules limit the acceptance, publication, and marketing of
certain residential real estate listing contracts, thereby limiting
home sellers' ability to choose a listing type that best serves their
specific needs. The complaint alleges that the conduct was collusive
and exclusionary, because in agreeing to keep non-traditional listings
off the MLS and from public Web sites, the brokers enacting the rules
were, in effect, agreeing among themselves to limit the manner in which
they compete with one another, and withholding valuable benefits of the
MLS from real estate brokers who did not go along. In addition, the
complaint alleges that MiRealSource actively enforced the
anticompetitive rules and policies through violation letters to members
and substantial fines.
Some of the conduct at issue in this matter also is similar to the
conduct addressed by the Commission in its recent consent orders
involving real estate boards and associations operating MLSs in Texas,
New Hampshire, New Jersey, Virginia, Wisconsin and Colorado.\6\ As in
those matters, certain rules or policies of Respondent challenged in
the complaint preclude information about properties from being made
available on popular real estate Web sites because the listing
contracts do not follow the traditional format approved by the MLS.
These rules or policies prevent properties with non-traditional listing
contracts from being displayed on a broad range of public Web sites,
including the national ``Realtor.com'' web site operated by the
National Association of Realtors, the local web site operated by
MiRealSource, and individual members' Web sites.
---------------------------------------------------------------------------
\6\ In the Matter of Austin Bd. of Realtors, Docket No. C-4167
(Final Approval, Aug. 29, 2006); In the Matter of Northern New
England Real Estate Network, Inc., Docket No. C-4175 (Final
Approval, Nov. 22, 2006); In the Matter of Monmouth County
Association of Realtors, Inc., Docket No. C-4176 (Final Approval,
Nov. 22, 2006); In the Matter of Williamsburg Area Association of
Realtors, Inc., Docket No. C-4177 (Final Approval, Nov. 22, 2006);
In the Matter of Realtors Association of Northeast Wisconsin, Inc.,
Docket No. C-4178 (Final Approval, Nov. 22, 2006); In the Matter of
Information and Real Estate Services, LLC, Docket No. C-4179 (Final
Approval, Nov. 22, 2006). The ABOR consent order was published with
an accompanying Analysis To Aid Public Comment at 71 Fed. Reg. 41023
(July 19, 2006). The other five consent orders were published at 71
Fed. Reg. 61474 (October 12, 2006).
---------------------------------------------------------------------------
A. The Respondent Has Market Power
MiRealSource serves residential real estate brokers in Southeastern
Michigan. These professionals compete with one another to provide
residential real estate brokerage services to consumers. Membership in
the MiRealSource MLS is necessary for a broker to provide effective
residential real estate brokerage services to sellers and buyers of
real property in this area.\7\ By virtue of broad industry
participation and control over a key input, MiRealSource has market
power in the provision of residential real estate brokerage services to
sellers and buyers of real property in the MiRealSource Service Area.
---------------------------------------------------------------------------
\7\ As noted, the MLS provides valuable services for a broker
assisting a seller as a listing broker, by offering a means of
publicizing the property to other brokers and the public. For a
broker assisting a buyer, it also offers unique and valuable
services, including detailed information that is not shown on public
web sites, which can help with house showings and otherwise
facilitate home selections.
---------------------------------------------------------------------------
B. Respondent's Conduct
Non-traditional forms of listing contracts, including Exclusive
Agency Listings, are used by listing brokers to offer lower-cost real
estate services to consumers. The series of rules and policies adopted
by Respondent were joint action by a group of competitors to withhold
distribution of listing information from rivals who did not contract
with their brokerage service customers in a way that the group wished.
This type of conduct was condemned by the Commission 20 years ago. In
the 1980s and 1990s, several local MLS boards banned Exclusive Agency
Listings from the MLS entirely. The Commission investigated and issued
complaints against these exclusionary practices, obtaining several
consent orders.\8\ The complaint alleges that, in addition to following
these past practices, MiRealSource also extended its exclusionary rules
to the more modern method of distributing listing information publicly
via the internet.
---------------------------------------------------------------------------
\8\ See, e.g., In the Matter of Port Washington Real Estate Bd.,
Inc., 120 F.T.C. 882 (1995); In the Matter of United Real Estate
Brokers of Rockland, Ltd., 116 F.T.C. 972 (1993); In the Matter of
Am. Indus. Real Estate Assoc., Docket No. C-3449, 1993 WL 13009648
(F.T.C. Jul. 6, 1993); In the Matter of Puget Sound Multiple Listing
Serv., Docket No. C-3390 (F.T.C. Aug. 2, 1990); In the Matter of
Bellingham-Whatcom County Multiple Listing Bureau, Docket No. C-3299
(F.T.C. Aug. 2, 1990); In the Matter of Metro MLS, Inc., Docket No.
C-3286, 1990 WL 10012611 (F.T.C. Apr. 18, 1990); In the Matter of
Multiple Listing Serv. of the Greater Michigan City Area, Inc., 106
F.T.C. 95 (1985); In the Matter of Orange County Bd. of Realtors,
Inc., 106 F.T.C. 88 (1985).
---------------------------------------------------------------------------
C. Competitive Effects of the Respondent's Rules and Policies
The MiRealSource rules and policies have prevented its members from
offering or accepting Exclusive Agency Listings. Thus, the rules impede
the provision of unbundled brokerage services, and may make it more
difficult and costly for home sellers to market their homes. The
Respondent's rules and policies have caused some brokers to exit from
the real estate business in Southeastern Michigan, or to refrain from
offering non-traditional brokerage services in that market or to not
enter at all. Furthermore, the rules have caused home sellers to switch
away from Exclusive Agency Listings to other forms of listing
agreements.
By preventing Exclusive Agency Listings from being included in the
MLS and transmitted to public-access real estate Web sites, the
MiRealSource rules and policies have adverse effects on home sellers
and home buyers. When home sellers switch to full service listing
agreements from Exclusive Agency Listings that often offer lower-cost
real estate services to consumers, the sellers may purchase services
that they would not otherwise buy. This, in turn, may increase the
commission costs to consumers of real estate brokerage services. In
particular, the rules deny home sellers choices for marketing their
homes and deny home buyers the chance to use the internet easily to see
all of the houses listed by real estate brokers in the area, making
their search less efficient.
D. There Is No Competitive Efficiency Associated With the Web Site
Policy
The Respondent's rules at issue here advance no legitimate
procompetitive purpose. As a theoretical matter, if buyers and sellers
could avail themselves of an MLS system and carry out real estate
transactions without compensating any of its broker members, an MLS
might be concerned that those buyers and sellers were free-riding on
the investment that brokers have made in the MLS and adopt rules to
address that free-riding. But this theoretical concern does not justify
the rules or policies adopted by MiRealSource. Exclusive Agency
Listings are not a credible means for home buyers or sellers to bypass
the use of the brokerage services that the MLS was created to promote,
because a listing broker is always involved in an Exclusive Agency
Listing, and other provisions in the MiRealSource rules ensure that a
selling broker--a broker who finds a buyer for the property--is
compensated for the brokerage service he or she provides.
Under existing MLS rules that apply to any form of listing
agreement, the listing broker must ensure that the home seller pays
compensation to the cooperating selling broker (if there is one), and
the listing broker may be liable himself for a lost commission if the
home seller fails to pay a selling broker who was the procuring cause
of
[[Page 6570]]
a completed property sale. The possibility of sellers or buyers using
the MLS but bypassing brokerage services is already addressed
effectively by the Respondent's existing rules that do not distinguish
between forms of listing contracts, and does not justify the series of
exclusionary rules and policies adopted by MiRealSource. It is
possible, of course, that a buyer of an Exclusive Agency Listing may
make the purchase without using a selling broker, but this is true for
traditional Exclusive Right to Sell Listings as well.
IV. The Proposed Consent Order
The proposed order is designed to ensure that the Respondent does
not misuse its market power, while preserving the procompetitive
incentives of members to contribute to the MLS.
The proposed order prohibits MiRealSource from adopting or
enforcing any rules or policies that deny or limit the ability of MLS
members to enter into Exclusive Agency Listings, or any other lawful
listing agreements, with sellers of properties. More specifically, the
proposed order prohibits MiRealSource from preventing its members from
offering or accepting Exclusive Agency Listings or other lawful listing
agreements; cooperating with Listing Brokers or agents that offer or
accept Exclusive Agency Listings or other lawful listing agreements;
publishing Exclusive Agency Listings or other lawful listing agreements
on the MLS and approved Web sites; publishing their information
concerning listings on public real estate Web sites, including but not
limited to https://www.FSBO.com; requiring members to have a physical
office; and offering unbundled real estate brokerage services,
including but not limited to requiring MiRealSource Shareholders to
provide a minimum set of real estate brokerage services. The proposed
order also prohibits MiRealSource from denying or restricting the
services of the MLS to Exclusive Agency Listings or other lawful
listings in any way that such services of the MLS are not denied or
restricted to Exclusive Right to Sell Listings; or treating Exclusive
Agency Listings, or any other lawful listings, in a less advantageous
manner than Exclusive Right to Sell Listings, including but not limited
to, any policy, rule or practice pertaining to the transmission,
downloading, or displaying of information pertaining to such listings.
In addition to these substantive provisions, the proposed order
states that, within forty-five days after it becomes final, Respondent
shall have conformed its rules to the substantive provisions of the
order. Respondent is further required to notify its members of the
applicable order through its usual business communications and its Web
site. The proposed order requires notification to the Commission of
changes in the respondent's structure, and periodic filings of written
reports concerning compliance. The relief in the proposed consent order
ensures that the Respondent cannot revert to the old rules or policies,
or engage in future variations of the challenged conduct.
The proposed order applies to MiRealSource and entities it owns or
controls, including its respective MLS and any affiliated Web site it
operates. The order does not prohibit members, or other independent
persons or entities that receive listing information from Respondent,
from making independent decisions concerning the use or display of such
listing information on member or third-party Web sites, consistent with
any contractual obligations to Respondent.
The proposed order will expire in 10 years.
By direction of the Commission.
Donald S. Clark,
Secretary.
[FR Doc. E7-2305 Filed 2-9-07; 8:45 am]
BILLING CODE 6750-01-P
