Buffett's brokerage reaches $250m antitrust settlement
A real estate brokerage owned by Warren Buffett's Berkshire Hathaway said on Friday it reached a $250 million settlement of nationwide antitrust litigation that is expected to change how real estate agents are paid.
Homeservices of America, the largest U.S. real estate brokerage, was the last remaining defendant in a case against the National Association of Realtors (NAR) and four brokerages.
Its settlement would eliminate the risk of a much higher payout, after a jury in Kansas City, Missouri in October sided with home sellers who accused the industry of conspiring to keep real estate commissions in that state artificially high.
Jurors awarded $1.78 billion of damages, which a judge could have tripled.
Homeservices' settlement requires court approval. Lawyers for the plaintiff sellers did not immediately respond to requests for comment.
The NAR agreed to settle nationwide antitrust litigation for $418 million last month, and won a judge's preliminary approval on Tuesday.
It also agreed to rewrite rules for paying buyers' and sellers' agents. Analysts said the changes could lower commissions by at least 25 per cent.
With the latest settlement, the NAR and brokerages including Homeservices Anywhere Real Estate and Re/ Max would pay more than $943 million to resolve antitrust claims.
Berkshire Hathaway owns 92 per cent of Berkshire Hathaway Energy, which owns Homeservices as well as a variety of utilities, pipelines and renewable energy projects.
Homeservices spokesperson Chris Kelly said the brokerage's settlement represents "a sole obligation of Homeservices, with no participation by any parent entity," and will result in a $140 million after-tax accounting charge.
Berkshire Hathaway Energy remains a defendant in a similar Kansas City case against several brokerages.
Lawyers for plaintiffs there did not immediately respond to requests for comment.
Buffett's conglomerate, Berkshire Hathaway, ended 2023 with $167.6 billion of cash and equivalents.