Michael Ketchmark is an attorney at Ketchmark and McCreight, P.C., a plaintiff’s law firm in Kansas City, Missouri which specializes in personal injury and employment discrimination cases.
Anthony Lamacchia breaks down his debate with attorney Michael Ketchmark regarding the National Association of Realtors (NAR), focusing on the role and value of buyer agents, the impact of the internet on real estate, and criticisms of the NAR and MLS systems. Anthony addresses criticisms from Michael Ketchmark, who argues against the NAR and MLS, suggesting they operate like a ‘cartel’. Anthony refutes claims made by Ketchmark, as does real estate industry leader, Bess Freedman (CEO of Brown Harris Stevens), emphasizing the hard work of buyer agents, the transformative effect of the internet on real estate, and the importance of the NAR and MLS in maintaining a fair and competitive market.
Anthony also discusses recent developments, including settlements in lawsuits against real estate companies and the potential implications of a Department of Justice (DOJ) statement of interest in a case related to MLS practices. Anthony concludes the video by standing firm in his defense of the real estate industry and announcing plans to provide further updates on the situation.
Anthony Lamacchia: NAR has a long history of price-fixing going back to the 1800s. Here’s an MLS book right here. Look where it says, “Proprietary to MLS members, $1,000 fine.” Folks, that is just a glimpse of what happened in the debate on HousingWire two weeks ago with Michael Ketchmark. It was a lengthy debate, one hour long. We both threw some barbs, but I thought it was a pretty good discussion. I was very happy with my performance in it. Of course, there’s some things that I wish I explained a little bit further, some things that I wish I spent a little bit more time on, like what buyer agents do.
What I thought I would do here in this video is break down a bunch of things from the debate and talk about some updates over the last two weeks. Now, getting back to the debate for a second, and then I’m going to start. There were a few people who felt I might have been too personal or too harsh. Again, it was very few. I had literally 1000, over 1000 messages all in from multiple channels, from realtors all over the country I’d never heard of. They were cheering me on and thanking me very sincerely for taking on Mr. Ketchmark, but there were a few that felt I was too harsh.
One of the things I want to remind you all of, this guy offered me a dictionary in his opening statement saying that I didn’t understand where the word cartel came from or what it meant. First I want to say, Mike, please do send me that dictionary because I don’t spell very well and I’d like to have one here on my desk every single day. I think it would help me out. Now, moving into the content. Let’s first tackle this part about buyer agents. I realized when I watched it again, it was the first thing my COO said to me is, “Yes, there was one part you didn’t answer a question.”
I watched it and I realized I was so caught up in what do I answer first, the format of the debate, which in fairness, I agreed to. I had never done a debate. I realized when a question is asked to one person, the other gets to rebuttal and then that person is now asked the next question. They go two times in a row, that second person. That favored to me sometimes, it favored to Mike sometimes, but it made it a little bit difficult to go back and answer the question. I slipped on that one.
I also want to be honest and say I wasn’t that fixated on explaining what buyer agents do because, folks, the audience was 90% realtors, 10% industry folks. There were very, very few members of the public outside of Michael and my friends and family that were watching this kind of thing. Could I have done better on it? No doubt. That’s what I want to tackle first. Let me spend 60 to 90 seconds on it. Buyer agents do a tremendous amount of work on behalf of buyers. Keep in mind, all the consumer advocates were out screaming in the 1990s for buyers to have an agent.
They’ve had one for 20, 25 years, many of which have fiduciary duties depending upon the state. Now, as I pointed out very well, particularly at the end of the debate, what Michael and his attorney friends and all them on this anti-NAR, anti-MLS crusade are going to do is hurt buyer agency. Buyer agents are doing a tremendous amount of hard work well in advance of making offers on properties, well in advance of finding properties. That’s one of the great misconceptions. Michael mentioned that the internet has changed every industry except this one.
I’m going to get to that next. Buyer agents are doing a ton of work on behalf of their buyers, not just finding them properties. Finding the property is about 25% of the work in this market. Normal market, it’s probably 10% of the work, but we’re in a low inventory market. Now, keep in mind, I explained some of that in prior videos, and that’s part of the reason I didn’t spend a ton of time on it. Helping them find properties, figuring out what to negotiate for offers, working with preferred– call it vendors. Getting them connected with mortgage brokers, home inspectors, assisting them in making those connections, making sure they’re working with the right people.
In addition to that, once the offer is actually accepted, which, by the way, in this market, they might make offers on five properties before they even land one because there’s multiple offers everywhere, particularly at this time of year. They make offers on multiple properties, they land one. Then a tremendous amount of work starts, which is helping that buyer go through closing. Most buyers, as I said, for everyone involved in real estate sales, real estate sales are both emotional and financial. They need guidance. They need help.
Think about it. With all the negative media out there, catchmark out there, talking bad about us in the news, which, by the way, I’m going to show you soon. I’m going to show you soon. Keep watching. All the negative media, people are still clicking Contact Agent on Zillow, on realtor.com, all of these different websites. People are still hiring realtors. None of that has stopped. I hope that helps with the buyer agency. I agree, could have done a little better there.
Then his comment, the internet has changed every industry except in real estate. Something to that effect. Obviously, watch the debate at recases.com to see exact wording on things and exactly how it transpired. That is not true. The internet has had a huge impact on our industry, massive, massive impact on our industry. Buyers are searching for homes. Buyers have homes at their fingertips.
There’s no such thing as hiding properties from buyers once they are on the open market and a seller chooses to be on the open market. There’s literally no such thing. Think about this. The MLSs syndicate out to multiple websites, Zillow, realtor.com, all these different websites, they’re sharing just about everything. Obviously, attachments and things are not able to share. Seller’s disclosures, seller’s statements of property conditions, those aren’t making their way through.
The vast majority of the data from the MLSs is not being hoarded in any way, shape, or form. It’s being syndicated out. As of late, even Zillow is showing cooperating brokerage compensation. The notion that MLS, he pulls out the book and he mentions the 1800s. He mentions the 1950s. Folks, this book right here, December 12th through 18th, 1980, I wasn’t even born. I was born four months later. My birthday’s coming up, Mike. Maybe send me the dictionary for my birthday.
Next. Some of this stuff I already said in the debate. I’ve said in past videos. I’m going to go quick. Damaged Missourians. I’ll say what I said in the debate and I’ll say it again. The plaintiffs in this case, I don’t know that it was every one of them, but a lot of these plaintiffs were manufactured plaintiffs, constructed plaintiffs that Michael Ketchmark and Brandon Boulware and Matt Demeron pulled together, their friends, other lawyers, people that are involved in the Bar Association, et cetera.
They were plaintiffs in the beginning and then all of a sudden in the 11th hour, a few of the more well-known figures bailed out and they got other plaintiffs to jump on. I’m just the guy that’s willing to say this stuff on a camera, folks, and that’s why most of you keep watching because most of you know I speak facts. I would not go anywhere near bringing up conspiracies or things like that. I wanted to mention that. One of the things I mentioned in the debate and I think it’s worth reiterating is Michael again in the debate made sure to say, “I saw trainers in your industry talking about X percent commission and Y percent commission.”
I’ll say the same thing I said in the debate. If prices were fixed, if commissions were fixed, trainers wouldn’t exist. I meant what I said and I’ll say it again. Trainers wouldn’t exist. Every industry has trainers. I pointed that out in the debate. RGH Consulting, a legal consulting firm down in Baton Rouge, Michael likes them on LinkedIn. Nothing wrong with Michael doing that. Nothing wrong with trainers in various industries. It’s the norm.
Next. One thing he kept saying, and I don’t think I did a great job on answering it because I was distracted with everything else, but he kept saying, “Name another industry where the compensation is paid from the seller to the buyers. Name another industry,” particularly in the beginning of the debate. There are other industries. Maybe they’re not set up in the same exact fashion as real estate. We’re in a very odd industry with an odd structure, but I heard from many people who saw the debate and said, “Hey, let him know that in boating and boating sales that happens.”
Then one that I thought of was lending. Think about lending. When you go to borrow to– you borrow hard money or you borrow for a mortgage, you’re paying for the lender’s attorney. You’re paying for their title insurance. You’re paying for many things for them. Now, is it the exact same argument, a lender to a buyer’s agent or buyer’s brokerage? I don’t think it’s identical, but it’s pretty darn close. Michael could make the same argument. Hey, if the lenders wants an attorney, they should hire one and they should pay for one. There’s my answer to that.
Rigged system, pocket-picking. I’m not going to go back through all that. He says, “I’ve always referred to NAR as whack-a-mole. Our goal is to unplug the whack-a-mole machine and topple them completely.” I quoted that a few times during the debate. He said that in the New York Times in late December. It bothered me. I wanted to point it out to everyone. Some of those quotes, we’re going to show you in the highlight reel of some of Michael’s news clips in a few minutes.
First, I want to just talk about what would a world look like without NAR and without MLS? Just think about that. I was hoping to mention this during the debate, I didn’t have time. Let’s say Michael achieves his goal of toppling NAR, toppling the MLSs. Then what happens? There’s a vacuum. A private player comes in and they become the MLS that everyone has to use, similar to what happened in commercial. Now in commercial, CoStar essentially owns the market. They’ve been charged with a monopoly several different times.
They found not guilty. I don’t know whether they are or they aren’t. I don’t know. Is that better? Would it be better if CoStar came in like a vacuum into the residential space and they became the MLS or Zillow? Then they can charge anything they want. They can charge per listing like what’s done in the commercial world. I don’t think that’s better at all. There’s 500 and something MLSs across the country, not eight something that Michael keeps saying, and those are run by associations and people. Lots of realtors choose along with their sellers to list properties on there. That’s okay. It’s not one entity that’s owning the entire market. To me, that’s a lot more of a fair way to do business. It’s a much fairer way to do business.
Mortgage guidelines, down payment assistance, watch the end of the debate, I crushed Michael on that. He was like flailing, trying to say, “It says as long as you don’t makeup to over 140,000, then you can get down payment assistance.” Michael, there’s like nine things wrong with that. A mortgage broker friend of mine came in my office a couple hours after the debate and said, “Anthony, you could have said this, you could have said that, you could have said that.” Bottomline, for some reason, it’s one of his talking points and he sticks to his talking points.
This guy should run for office. He’d be very, very effective. He said, “Why don’t realtors offer people down–?” There’s plenty of realtors that are working with people on down payment assistance when they can get it, but as I said in the debate, the two collide, the two compete. Down payment assistance is only offered many times as long as someone makes less than Y, but then they can only get the mortgage if they make more than X. It’s a competing interest. It doesn’t always work, and that’s why I pointed that out.
Something else he said, “NAR’s website mentions commissions all over it.” Maybe there’s somewhere. I’ve never seen it. We scoured NAR’s website. I didn’t see it absolutely anywhere. Then he made a comment, “NAR owns realtor.com.” What? That’s totally, totally untrue. NAR, National Association of Realtors, sold to News Corp in 2014. They sold the whole brand. They still own realtor.com, the URL. Maybe that’s what he meant, but I don’t think so. They have it with a licensing agreement, but NAR has no operational or any type of say that I know of.
I looked at the public statement, and we can show it here on the screen. They have no say in what goes on with realtor.com. Him trying to tie the two together, that’s just another catchmark talking point that he hopes gets picked up. This will be the second to last part of the debate that I will pick apart, the emails. Remember when he said several times, “You agreed to this, you agreed to this, you agreed to this format.” Michael’s quite good at narrowing the focus in the courtroom, just like he tried to do here with this debate, wanting the questions in advance, wanting us to stick to the format.
Michael Ketchmark: Oh, you agreed to that, too. Be fair.
Anthony Lamacchia: I did. I did. I said [crosstalk] [inaudible 00:12:54].
Michael Ketchmark: Be fair. Be fair. Be fair.
Anthony Lamacchia: Then you interrupted me.
Michael Ketchmark: Yes, but what you’re saying is false. I’m not going to let you lie. You agreed to it, too. We both did.
Anthony Lamacchia: Yes, I did agree, but I didn’t ask for it. You asked for it. Normally, Michael, I would never share our texts, which I’m not going to do. I would never share our emails that we’ve had since we’ve been in communication since the day after Thanksgiving, but since you called me out so much and you kept threatening to show it, I’m going to show it. Let’s take a look at the email. Notice where I said, “Thank you. Sounds fine. For the record, I’m fine with getting no questions in advance. The object here is to make this raw and real, not to give us time to lawyer up our answers, but if that’s what you guys and Mike want, it’s fine by me.”
I had said that because a couple of emails prior, Michael said, “Are we getting the question in advance? I’d like to.” Michael responded to that about two hours later. “I prefer to have the questions ahead of time. I think it will lead to a more educated debate. I will keep them to myself, and don’t worry, Anthony, I have no doubt that it will be raw and real.” Okay, now, is he doing something wrong saying that in an email?
Is he doing something wrong asking for the questions in advance? Of course, he’s not. I’m not saying there was anything wrong with that. What bothered me is he kept saying, ‘I’ll show the emails, I’ll show the emails,” so Michael, I showed the emails, pal. I kept it restricted to this. Just want to point that out to everyone who was watching who may have doubted that I was being fictitious on that or something. I was not. You just saw the emails.
Next. To the few of you that feel I might have been too personal, I have a message for you: I disagree. I went in there with a plan. I went in there with a plan to purposely expose some of the things that I had heard. I would never go on camera and say things that were maybe true or pitch conspiracies, ever. Let’s take a look at some of the things that Michael said in the news about our industry and about us realtors prior to the debate. One of the things I found on the few people that told me I was too personal or too harsh, when I asked them, “Did you ever see Mike on the news before the debate?” almost all of them said no. Go ahead and take a look.
Michael Ketchmark: Yes, I heard that argument made in court today with the National Association of Realtors and these corporate real estate companies are saying, “Look, we may be ripping off sellers when they’re selling the house, but they’re benefiting when they’re ripping off other sellers if they’re buyers.” A lot of our clients are people who didn’t turn out, sell a home, and become a buyer. What about the couples who retire and don’t buy another house?
What about the people who pass away? This case is simple. It comes down to premises I learned when I was in kindergarten. If you take something that doesn’t belong to you, you give it back. The money will be returned to the homeowners that were the victims of this rigged system. It’s been going on in our country for about 100 years, and it stops today. We are wasting right now about $50 billion a year in wealth that’s being taken out of the pockets of homeowners and transferred over to these corporate machines that have taken over real estate.
It’s got to stop. I’ve got nothing against buyers’ agents. I think they’re awesome. The person they should pay for is the person they’re working for. With this member of the National Association of Realtors, she just gave away the case. She said you have competitors who are working together. They’re colluding together to fix the prices-
Bess Freedman: I never said colluding.
Michael Ketchmark: -at 6%. That’s what’s happening. That’s what the jury heard two weeks of evidence of. We revealed the documents, we revealed the videotapes, we revealed all of the emails. The CEO of the NAR testified at trial and took the stand, and we exposed him for what he is. It is a cartel.
Bess Freedman: It is not a cartel.
Michael Ketchmark: It’s a cartel that is– [crosstalk] [inaudible 00:16:35] It’s a cartel that is designed–
Bess Freedman: I really take offense at that. It is not a cartel.
Michael Ketchmark: I’m sure you do. I take offense at the fact that the NAR broke up the system–
Bess Freedman: Listen, it broke them for a long time. There was no co-broking. You know what that does? A disservice to the consumer. What you’re saying is really offensive and I take that– [crosstalk]
Michael Ketchmark: It’s spreading really wide in the United States of America or commissions to– [crosstalk] [inaudible 00:16:51]
Bess Freedman: It is not a cartel.
Michael Ketchmark: Half the time, these corporations are making their money representing sellers. Half the time, they’re making their money representing buyers. They’re propping this system up, and they’re benefiting each other.
Anthony Lamacchia: If that doesn’t aggravate you as someone in the real estate industry or as a realtor, I don’t know where you come from, but it aggravates me, saying that we take things that don’t belong to us. We’re working together. We’re colluding against consumers. When we know just the opposite is true. Now I want to show you some highlights from the debate where Michael used similar talking points and said some pretty harsh things. He was pretty fired up about it when he said it. Take a look.
Michael Ketchmark: They say if you give this to somebody who’s not a part of the club, you’re going to be fined $1,000. You’re not going to be allowed to use the MOS. What that does, that was an attempt to put a stranglehold on the data. To do it for one reason and one reason only, to keep the money. It’s the corporate titans that are doing this. It’s a National Association of Realtors. I have no crusade against the National Association of Realtors. The cartel means, Anthony, it’s not just a drug cartel.
I’d be happy to send you a dictionary if you want to look it up. The definition of a cartel is when competitors get together to fix or set rules that stabilize prices. That’s what’s happening. What I’m hoping is that the industry can have a wake-up call because there’s going to be a change. The internet is going to change things. What I do think is wrong and corrupt and improper, not just me, a jury, is when you force a home seller to engage in that.
The plaintiff’s attorneys who are grabbing the money, it’s the defendants that grab the money. It’s the National Association of Realtors that set these rules up. Stealing or taking money, I’ll use the word taking money that doesn’t belong to you as part of a system that props up commissions, it’s absolutely wrong. I am absolutely happy that I handled this case. The plaintiffs are the 500,000 people who were ripped off by this rigged system.
Anthony Lamacchia: As I stated, I was in there as a lone wolf. No one asked me to go in. No one asked me to do it. In fact, some asked me not to. It was my decision. I report to me. For the few of you out there that feel I was too harsh, if you think I was too harsh against someone that’s attacking our industry, attacking realtors, and, even if this person is half successful, going to have a negative impact on home buyers and veterans that use VA, I can live with that reputation as someone that was too harsh defending those kinds of things. It’s my decision. That’s what I did. I don’t regret it at all. I stand behind every single thing I said in that debate. All of it’s factual, and we’ve found even more since then. We’ve put more on recases.com. Some of the political donations and things, those have been added. Go look. All the backup to everything I said is there, and the debate is there.
Now, moving on. Next up, things that have happened over the last couple of weeks. National Association of Realtors President Kevin Sears was on our stage at the Crush It in Real Estate event that we had last week. We had a wonderful event, a ton of great speakers. I thought it went very well. I very much enjoyed Kevin’s straight talk. It was refreshing to hear a leader from the National Association of Realtors talk straight.
Now, of course, the news I saw in the other day quoted something. There was another person who put out a video while Kevin said DOJ is pissed off at us. That’s facts, folks. That’s facts. That’s the truth. He said something like “We’ve been in the DOJ crosshairs as long as I can remember.” Ooh, tough language. Kevin’s right. Okay, the president of NAR is right. He also talked about many other things that the National Association of Realtors is doing.
Of course, they didn’t put that in any of the articles. He talked about things like there’s no association for homebuyers. There’s no association for home sellers. The National Association of Realtors is representing the interest of private property rights, homeowners, and realtors. I’ve talked about that in past videos. Mr. President, if you happen to see this, thank you very much for coming out to our event. We enjoyed having you.
KW, Keller Williams settled for $70 million. Hey, if that’s what Gary felt was the right decision, I’m sure it was for his organization. They’re a great company and they’re led by a great leader. Funny enough, coincidentally, that settlement happened about an hour before I went on stage at our Crush It in Real Estate event. I was getting a lot of questions going on the stage. One of the questions many have had is, how do they settle? I thought there’s a jury verdict for 1.7 billion.
Folks, keep in mind, and I’ll be honest, I didn’t know all this about court systems until the last few months when I really started studying this stuff. A settlement can happen at any time. The judge hasn’t certified the case just yet. NAR and Berkshire Hathaway and KW talked about appealing. Ketchmark does not want this to be appealed. If it gets appealed, it goes to the Eighth Circuit Court of Appeals. That is outside of Ketchmark’s court. Yes, I said Ketchmark’s court. I said it in the debate. I’m saying it now because it essentially is Ketchmark’s court.
Someday, I believe that they’ll actually change. They’ll etch in stone and put his name right on the top of the court someday, perhaps after he retires from a successful career. He doesn’t want that appeal to happen. The other thing that he doesn’t want to happen, and I love how he spun it in the media, Wall Street Journal, he was quoted as saying, “We agreed to the 70 million because we didn’t want to bankrupt the company.” Amazing. He says that like he actually means it. Folks, if the company goes bankrupt, he gets pennies on the dollar from whatever the bankruptcy trustee decides that he gets.
Of course, he doesn’t want to bankrupt them. That $70 million in hard-earned money that comes out of Gary’s pocket, the company’s pocket, has an effect on the realtors at that company across the board. Same thing with the Anywhere settlement. Same thing with the RE/MAX settlement. It’s going to have some impact. I’ve never in my career rooted for my competitors so much as I am in this case. Why? Because I can relate to someone like Gary. He started his company from nothing in the early ’80s. I started my company in 2009 from nothing, with $500 in a bank account.
To see him have to fork over $70 million from a fake case with a verdict that isn’t legitimate, I feel for the guy. I do. If he felt it was right, I’m sure he knows what he’s doing. In addition to that, the other thing that’s happened, and it came out just this week, is Berkshire Hathaway filed an appeal with the Supreme Court. Now, don’t get confused. When I saw it in my email subject, I said, “Whoa, they officially appealed?” No. They’re appealing on an earlier argument prior to the case starting with respect to arbitration.
Verify on your own on this one, because I haven’t seen it. Apparently, their listing agreements with sellers in the state of Missouri say that if there’s some sort of dispute, they’re supposed to go to mandatory arbitration. They made this argument early on to say that the Sitzer-Burnett trial shouldn’t happen. I assume they made this argument to Judge Boe, and he shot it down, and they had to trial. Berkshire’s taken that argument, even though the case is over. I should say, the trial’s over. They’re taking that argument to the Supreme Court. I find that to be interesting. I wish them the best of luck in doing that, and I hope that they are successful.
Now, next Thursday, February 15th, is a very, very important date, really, for all of these cases. That’s why anybody that’s interested in these cases nationally is going to be tuned in. In the MLS PIN case, which we talked about a lot on our stage at the Crush It event, Michael McDonough, our general counsel, and Jessica Egerton from leading real estate companies of the world, one of the things they talked about is, and what they explained is, that MLS PIN case has something interesting.
Twice, the plaintiffs and the defendants’ MLS PIN have come to an agreement to settle. Twice, the DOJ, or at least once, has stepped in and said, “No, no, we don’t like the settlement. We don’t want it to settle. We request more time.” The judge finally said, “Hey, if you want to say something about this case, you can file a statement of interest by February the 15th.” Now, we’ll see if that sticks next week or if it gets extended. If it sticks, this is going to be the first time that we all are going to be able to look at that statement of interest and see specifically what the DOJ wants.
So far, they’ve been like the boogeyman. We hear about them. We hear that they’re not happy with things. We know they overturned the prior agreement from 2020. That was appealed. Now we’re actually going to get a chance to read what they want. I’ll tell you what we suspect, and there’s no– You can’t hold us to this. This is just speculation based on what we’ve heard. I believe that they want any mention of cooperating brokerage compensation or anything about commission to be out of the MLSs.
They want it gone nationally. They want to rule it out. If I’m a realtor, if I’m you watching this, I’d be thinking about that. We are probably going to get to a place where those types of things need to be negotiated in the transaction, similar to how commercial is done. When that comes out next week, we will be sure to take a look at all of it, and I’ll be back to you the week after with an update to break it all down in simple terms.
I hope you’ve enjoyed this update. I hope you enjoyed my debate recap. I was very honest with you all, told you areas that I thought I could do better, also pointed out various things that Ketchmark said in the news, and so on. Everything I said is backed up on recases.com, including some new things that we found. We found some additional information with respect to political donations. Take a look. I hope you enjoyed it. See you again in two weeks. Thank you.