What I've been up to - AgentsCompared.com

It's been awhile since I last posted here, and for good reason. Going back to the summer of 2007 I've been developing an idea I've had about helping home buyers and sellers make more informed decisions when selecting a local real estate agent. Last month it came to fruition - AgentsCompared.com. Here's the text of our launch announcement:

FOR IMMEDIATE RELEASE:

Consumer-centric AgentsCompared.com Helps Prospective Chicagoland Home Buyers and Sellers Make More Informed Decisions When Selecting a Real Estate Agent

Chicago, IL – July 7, 2009 – Consumer-centric website AgentsCompared.com, launching today in Chicagoland, helps prospective home buyers and sellers make more informed decisions when selecting a real estate agent. The site lets consumers efficiently discover, evaluate and compare – on an apples to apples basis – competing local agents on the criteria most important to them, such as an agent’s track record (success stories, relevant statistics, etc.), price (commissions, rebates, etc.), specialties (first time buyers, short sales, REOs, etc.), local market knowledge, and over a dozen others. Prospective home buyers and sellers can use AgentsCompared.com to see how a referral stacks up against competing agents, and find other local agents that may offer better value, greater expertise, etc.

“I’m not a Realtor®, but I think it’s fair to say that none of the current “Find an Agent” websites appear to have been created with the consumer firmly in mind,” explained Chicago lawyer Michael Erdman, founder of AgentsCompared.com. “The space has unfortunately become stagnant, to the detriment of both consumers and agents. AgentsCompared.com will deliver some much needed innovation to the process of selecting a local real estate agent,” Erdman added.

AgentsCompared.com is unlike existing “Find an Agent” websites. It does not restrict the number or types of agents that can join the site or appear in relevant search results, or attempt to match consumers with agents. “Featured” placements and broker advertisements are not displayed in search results. Consumers simply run a search, review the results, and choose whether to make direct contact with an agent. They are not asked to pay a fee, register, provide personal information, navigate through multiple pages, or wait for an email in order to search the site or obtain results.

“Who you choose as your real estate agent can obviously make a big difference to your bottom line, end result, and overall experience when buying or selling real estate. AgentsCompared.com helps prospective home buyers and sellers understand their choices and ask important questions when selecting an agent, something that is especially important in the current housing market,” stated Erdman.

For Chicagoland real estate agents, AgentsCompared.com offers an opportunity to stand out from competing agents, and attract prospective home buyers and sellers that are looking for a local agent, by distinguishing themselves across a variety of categories that are important to consumers, and on a level playing field.

For additional information contact:

Michael Erdman
President & Founder
AgentsCompared.com
merdman@AgentsCompared.com

or visit www.AgentsCompared.com

Features, pricing, availability and specifications set forth herein are subject to change without notice.

# # #

Overview of USA v. NAR proposed Final Judgment

Here's a quick overview of the proposed Final Judgment ("PFJ") filed earlier today in USA v. National Association of Realtors. Note that before Judge Kennelly will consider and potentially enter the judgment, one or both parties will need to formally file a motion requesting same with the Court.

For a period of ten years, the settlement would prohibit NAR from adopting, maintaining or enforcing any rule, or entering into or enforcing any agreement or practice, that directly or indirectly:

• prohibits a Broker from using a VOW or prohibits, restricts, or impedes a Broker who uses a VOW from providing to Customers on its VOW all of the Listing Information that a Broker is permitted to Provide to Customers by hand, mail, facsimile, electronic mail, or any other methods of delivery;
  
  
• unreasonably disadvantages or unreasonably discriminates against a Broker in the use of a VOW to Provide to Customers all of the Listing Information that a Broker is permitted to Provide to Customers by hand, mail, facsimile, electronic mail, or any other methods of delivery;
  
  
• prohibits, restricts, or impedes the referral of Customers whose identities are obtained from a VOW by a Broker who uses a VOW to any other Person, or establishes the price of any such referral;
  
  
• imposes fees or costs upon any Broker who operates a VOW or upon any Person who operates a VOW for any Broker that exceed the reasonably estimated actual costs incurred by a Member Board in providing Listing Information to the Broker or Person operating the VOW or in performing any other activities relating to the VOW, or discriminates in such VOW related fees or costs between those imposed upon a Broker who operates a VOW and those imposed upon a Person who operates a VOW for a Broker, unless the MLS incurs greater costs in providing a service to a Person who operates a VOW for a Broker than it incurs in providing the same service to the Broker; or
  
  
• is inconsistent with the Modified VOW Policy (an exhibit to the PFJ).
  

Furthermore, NAR must (i) repeal the ILD Policy and direct each Member Board that adopted Rules implementing the ILD Policy to repeal such Rules; (ii) direct Member Boards that adopted Rules implementing the VOW Policy to repeal such Rules; (iii) adopt the Modified VOW Policy; (iv) direct Member Boards to adopt the Modified VOW Policy, and to thereafter maintain, act consistently with, and enforce Rules implementing the Modified VOW Policy; and (v) direct Member Boards not to adopt, maintain, or enforce any Rule or practice that NAR would be prohibited from adopting, maintaining, or enforcing pursuant to the PFJ. In other words, out with the VOW Policy and its successor, the ILD Policy. In with the Modified VOW Policy, a ten pager attached to the PFJ as an exhibit.

I haven't studied it yet, but the Modified VOW Policy appears to be based upon the original 2003 VOW Policy adopted by NAR on May 17, 2003. The 2003 VOW Policy was rescinded on August 31, 2005 in favor of the ILD Policy. If/when the Court enters the PFJ, I will highlight the changes contained in the Modified VOW Policy in a separate post.

The PFJ also gives NAR the green light to effectuate changes to the definition of “Participation” contained in the Statement of MLS Policy and previously adopted by NAR on 8/31/05 . This change impacts the definition of MLS Participant, which will now presumably read, in part, as follows:

[U]nder no circumstances is any individual or firm, regardless of membership status, entitled to MLS ‘Membership’ or ‘Participation’ unless they hold a current, valid real estate broker’s license and offer or accept cooperation and compensation to and from other Participants or are licensed or certified by an appropriate state regulatory agency to engage in the appraisal of real property. (emphasis added).

A "Note" accompanies the revised definition and directs that “[t]he requirement that an individual or firm ‘offers or accepts cooperation and compensation’ means that the Participant actively endeavors during the operation of its real estate business to list real property of the type listed on the MLS and/or to accept offers of cooperation and compensation made by listing brokers or agents in the MLS.” The PFJ prohibits member boards from suspending or expelling any broker on account of the new definition until May 27, 2009.

Here's a link to the DOJ's press release.

Settlement in USA v NAR?

A stipulation signed by attorneys for both parties and a proposed final judgment (not yet entered by Judge Kennelly) just appeared on the Court's online docket.

Perhaps the July 7 trial, which was to last approximately a month, has been averted? Keep in mind that a final judgment and/or other dispositive order has not yet been entered by the Court. In a related filing today, the United States stated that it will be filing a motion for entry of the proposed Final Judgment.

UPDATE: Read a summary of the proposed settlement.

Ninth Circuit: Roommates.com largely unprotected by Section 230

Earlier today the U.S. Court of Appeals for the Ninth Circuit, in Fair Housing Council of San Fernando Valley, et al v. Roommate.com, LLC, issued an en banc ruling that rejects the majority of the website's assertions of Section 230 immunity. For purposes of this (lengthy) post, I will assume you are familiar with the facts of the case and previous rulings. If that's not the case, check out my May 2007 summary of the three judge panel's decision reversing the District Court's application of Section 230 immunity.

The en banc panel here consisted of eleven Circuit Judges: Alex Kozinski, Stephen Reinhardt, Pamela Ann Rymer, Barry G. Silverman, M. Margaret McKeown, William A. Fletcher, Raymond C. Fisher, Richard A. Paez, Carlos T. Bea, Milan D. Smith, Jr. and N. Randy Smith.

The Court's opinion was authored by Chief Judge Kozinski, and a partial Concurrence/partial Dissent was issued by Judge McKeown, who was joined by Judges Rymer and Bea.

The bottom line you ask? Jump to page 28 of the slip opinion, wherein the Court advises that "[t]he message to website operators is clear: If you don’t encourage illegal content, or design your website to require users to input illegal content, you will be immune." Now for the loooong version, which excludes any consideration of the partial concurrence/dissent (maybe later).

We are of course dealing with a statute here, and the Court appropriately begins by asking what Congress had in mind when it enacted the law.

In passing section 230 . . . Congress sought to immunize the removal of user generated content, not the creation of content: “[S]ection [230] provides ‘Good Samaritan’ protections from civil liability for providers . . . of an interactive computer service for actions to restrict . . . access to objectionable online material." (quoting from a 1996 Conference Report)

I'm not so sure the "Good Samaritan" phrase is properly applied to Section 230(c)(1), but I think the point being made here is valid: In the online context, acting as an editor is generally protected. Acting as an author is not.

The Court proceeds to consider the challenged portions of the Roommates.com website. As to the questions asked of prospective subscribers during registration (disclosure of sex, family status, and sexual orientation), including the choice of answers provided by Roommates.com and offered in pull-down menus, the Court opines that

Roommate created the questions and choice of answers, and designed its website registration process around them. Therefore, Roommate is undoubtedly the “information content provider” as to the questions and can claim no immunity for posting them on its website, or for forcing subscribers to answer them as a condition of using its services. . . . The CDA does not grant immunity for inducing third parties to express illegal preferences. Roommate’s own acts—posting the questionnaire and requiring answers to it—are entirely its doing and thus section 230 of the CDA does not apply to them. Roommate is entitled to no immunity.”

Although it is purportedly just focused on the question of whether immunity applies, the Court further notes that "asking questions certainly can violate the Fair Housing Act and analogous laws in the physical world." More on this apparent divergence from the topic at hand (immunity) later.

The Court treats subscriber profiles the same way:

Although it is the subscriber that has answered the questions that are ultimately displayed in his or her profile, same “does not preclude Roommate from also being an information content provider by helping “develop” at least “in part” the information in the profiles. . . . By any reasonable use of the English language, Roommate is “responsible” at least “in part” for each subscriber’s profile page, because every such page is a collaborative effort between Roommate and the subscriber.

In other words, Roommates.com has again crossed the Section 230 line:

By requiring subscribers to provide the information as a condition of accessing its service, and by providing a limited set of pre-populated answers, Roommate becomes much more than a passive transmitter of information provided by others; it becomes the developer, at least in part, of that information. And section 230 provides immunity only if the interactive computer service does not “creat[e] or develop[]” the information “in whole or in part.”

The Court also declines to extend immunity to Roommate.com’s operation of its search system and email notification system. Observing that “Roommate designed its search system so it would steer users based on the preferences and personal characteristics that Roommate itself forces subscribers to disclose[,]” the Court addresses head-on the question of when does a website create or develop information:

We believe that both the immunity for passive conduits and the exception for co-developers must be given their proper scope and, to that end, we interpret the term “development” as referring not merely to augmenting the content generally, but to materially contributing to its alleged unlawfulness. In other words, a website helps to develop unlawful content, and thus falls within the exception to section 230, if it contributes materially to the alleged illegality of the conduct.” [this holding presumably explains the Court's delving into the underlying legality of some of Roommate.com's alleged actions here].

The preceding paragraph is a significant development in Section 230 jurisprudence, and merits close attention. What it seems to be saying is that for purposes of determining whether Section 230 immunity applies, we don't just look at whether the site created or developed the subject content. We must also examine whether the website "contributed materially to the alleged illegality of the conduct."

Based upon this new standard, the Court rules that Roommate.com "is sufficiently involved with the design and operation of the search and email systems—which are engineered to limit access to housing on the basis of the protected characteristics elicited by the registration process—so as to forfeit any immunity to which it was otherwise entitled under section 230." Rejected again.

However, the Court does rule that Roommate.com is immune to claims based upon third party submissions under the “Additional Comments” section of the site.

The case concludes with what could be construed as both a warning to the plaintiffs' bar and an encouraging word (?) to website operators:

[T]here will always be close cases where a clever lawyer could argue that something the website operator did encouraged the illegality. Such close cases, we believe, must be resolved in favor of immunity, lest we cut the heart out of section 230 by forcing websites to face death by ten thousand duck-bites, fighting off claims that they promoted or encouraged—or at least tacitly assented to—the illegality of third parties . . .. [I]n cases of enhancement by implication or development by inference—such as with respect to the “Additional Comments” here—section 230 must be interpreted to protect websites not merely from ultimate liability, but from having to fight costly and protracted legal battles.

The Court remands the case to the District Court for a consideration of the claims not immunized by Section 230.

I'm still digesting this thing (and may alter some of this post upon further reflection), but will say that I definitely anticipate a certiorari petition in the not too distant future. In the meantime, I recommend you give it a read. Check out the favorable language directed at search engines and sites that, like Roommate.com and the one in Carafano, classify user data. Also look for several generic examples offered by the Court of situations where immunity would and would not apply, and "clarifications" of two prior Ninth Circuit rulings (Carafano and Batzel).

I'm looking forward to getting through Judge McKeown's accompanying opinion and hearing what others have to say about the case.

Victory for ZeroBrokerFees.com in New Hampshire

Yesterday Magistrate Judge James Muirhead ruled in favor of ZeroBrokerFees.com in the website's suit challenging the applicability of the New Hampshire Real Estate Practice Act - specifically the licensure requirement - to the operation of ZeroBrokerFees.com. The court ruled that pursuant to a statutory exemption for newspapers, ZeroBrokerFees.com was not obligated to obtain a brokerage license in New Hampshire before advertising real estate online.

For a refresher, see my post from last May.

Here is a copy of ZBF's lawyers' announcement, and a copy of the court's 33 page order.