The real estate industry is undergoing seismic changes, and the recent NAR Sitzer lawsuit has turned the world of real estate commissions on its head. Whether you’re a broker, an agent, or someone looking to buy or sell a home, understanding these changes is crucial to navigating the new landscape. 

The Landmark Sitzer Settlement: What Happened?

The NAR Sitzer lawsuit has fundamentally altered how real estate commissions are structured and negotiated. In essence, the lawsuit challenged the traditional cooperative compensation rule that caused sellers to pay commissions to both their own broker and the buyer’s broker through required fee sharing. This practice was deemed anti-competitive by a court, leading to a massive settlement and a shift in the industry.

What Does This Mean For Brokers and Agents:

The traditional model of commission splitting is no longer guaranteed. Brokers must now negotiate their compensation separately from the other side of the transaction. This change means that you need to be more strategic in how you structure your agreements and ensure that your clients understand the value you bring to the table.

What Does This Mean For Homebuyers and Sellers:

Navigating the New Rules:

With these changes, staying informed and adaptable is key. Brokers need to understand the new legal requirements and adjust their practices accordingly. Here’s what you need to know:

• Contractual Obligations: Understanding the nuances of buyer brokerage agreements is more important than ever. Ensure that your contracts are clear and that both parties understand their responsibilities.
• Negotiation Strategies: With the industry moving away from the traditional cooperative compensation rule, it’s essential to develop new strategies for negotiating commissions and concessions. This is where your expertise as a broker can really shine.

Dive Deeper with The Lieb Cast Podcast:

For an in-depth breakdown of these changes and how they will impact your business, don’t miss our latest episodes of The Lieb Cast:

•  Big Changes in Real Estate Commissions: What You Need to Know: Real Estate Brokerage Attorney Andrew Lieb discusses the NAR Sitzer lawsuit and its implications for both buying and selling brokers. Find out whether you’ll pay more or less in commissions and how to hire a broker in this new reality.
• The New Reality of Real Estate Negotiations: Factoring in Commissions for Net Numbers and Concessions: Attorney Andrew Lieb and his legal team explore how brokers must adapt to new commission structures and the importance of understanding contractual obligations in today’s market.

Broker Continue Education:

To stay ahead of the curve, we highly recommend enrolling in our Compensation Post-NAR Sitzer Lawsuit: This 2.5 credit CE course satisfies the recent legal matters topical requirement for NY real estate salespersons and brokers.

In this on-demand video course, Attorney Andrew Lieb will guide you through:

• The details of the Sitzer case and its implications for real estate commissions.
• Changes to the NAR Cooperative Compensation Rule.
• Best practices for structuring your client relationships and transactions within the new legal framework.

This Continuing Education course is an essential resource for any real estate professional serious about understanding and profiting from the post-Sitzer commission landscape.

Stay informed, stay compliant, and stay competitive with Lieb School and The Lieb Cast!

Contact lead counsel of a real estate brokerage class action, anti-trust, and anticompetitive practices suit. 

Effective December 1, 2025, certain individuals involved in real estate closings and settlements are going to be required to report and maintain records on non-financed transfers of residential real property to legal entities and trusts pursuant to this Final Rule, 31 CFR Chapter X, RIN 1506-AB54.

Key Points:

• Reporting persons must file a "Real Estate Report" identifying themselves, the legal entity or trust receiving the property, the beneficial owners, the transferor, and the property, along with transactional information.

• A reasonable reliance standard allows reporting persons to rely on information from others, provided it is certified in writing.

• Under the proposed rule, attorneys could potentially be subject to a reporting requirement.

• The final rule includes exceptions for certain transfers, such as those resulting from grants, death, divorce, and bankruptcy.

• Negligent violations of the final rule could result in a civil penalty of, as of the publication of the final rule, not more than $1,394 for each violation, and an additional civil money penalty of up to $108,489 for a pattern of negligent activity.

Attorney Andrew Lieb's CLE course through Lawline on “Navigating Failure-to-Accommodate Housing Discrimination Lawsuits.” has hundreds of 5 star reviews!

Attorneys can register for the 2 Credit CLE here.

Overview

Discrimination litigation is happening everywhere, every day, across the United States. Did you know that a subset of discrimination litigation, failure-to-accommodate litigation, has nothing to do with discriminatory intent whatsoever? This means that defendants across the country are losing cases, and countless amounts of monetary damages/penalties, because they just don't know the rules of the game. It means that you, a licensed attorney, may even be discriminating against others without knowing it.

This two-hour CLE will teach you how to play the game and then, you can offer invaluable advice and counsel services to your clients whether they be landlords, property managers, HOA-coop-condo boards, tenants, buyers, or sellers. 

According to the CDC, 26% of US adults have some type of disability, which could qualify an individual to request a reasonable accommodation and/or modification in housing. When they do, are you ready to navigate the process and make smart decisions along the way? After this CLE, you will be ready.

Learning Objectives: 

1. Articulate the definition of a cognizable cause of action for failure-to-accommodate housing discrimination

2. Identify case law to analyze each element of a failure-to-accommodate housing discrimination claim and apply facts to the case law

3. Prepare and conduct an interactive process / cooperative dialogue in responding to a request for accommodation/modification

4. Navigate divergences between Federal, State, and Local law in failure-to-accommodate claims

Job description: Associate Attorney or Senior Associate Attorney

Role Overview:

Lieb at Law, P.C. is a small but powerful firm, tackling high-stakes cases that require both sharp legal expertise and a hands-on approach. We are seeking an Attorney with over 4 years of litigation experience, particularly in complex motion practice, oral arguments, depositions, and nuanced areas of law. The ideal candidate thrives in high-profile litigation and embraces a collaborative, “no job is too small” mindset. In this role, you will work directly with our dedicated team on cases that challenge the status quo and make a tangible impact. This position offers significant rewards for those who are ready to roll up their sleeves and contribute at every level, from motion practice to trial, offering an exceptional opportunity to influence case law and be part of landmark decisions.

Responsibilities:
- Handle litigation efforts across Plaintiff, Defense, and Appellate cases.
- Focus on fields such as Civil Rights/Discrimination, Employment, Real Estate Litigation, Real Estate Brokerage, and Commercial Litigation.
- Draft and manage pleadings, oversee discovery, draft and oppose motions, participate in ADR and administrative proceedings, and prepare for trials and appeals.
- Present compelling oral arguments and conduct thorough depositions.
- Collaborate effectively within a supportive and collegial team environment.

Requirements:
- Juris Doctor (JD) from an accredited law school.
- Admission to the New York State Bar.
- 4+ years of litigation experience within a private law firm setting.
- Extensive experience in drafting sophisticated legal motions and managing complex cases.
- Proficiency in legal research, with experience using Westlaw as a plus.
- Strong organizational, critical thinking, and persuasive communication skills, both written and verbal.
- Familiarity with employment litigation, discrimination litigation, real estate litigation, and commercial litigation is highly advantageous.

About Lieb at Law, P.C.:
Lieb at Law, P.C. is a leader in legal innovation, dedicated to advocating for victims of discrimination and offering expertise across a wide array of legal sectors. We merge cutting-edge technology with a deeply personal approach to deliver top-tier, cost-efficient representation. Our firm's success is fueled by our commitment to confidence, grit, and unmatched skill, providing our team with state-of-the-art tools for collaboration and research.

Our attorneys are not only formidable in the courtroom but also contribute to the broader legal community. Our managing partner serves as a media legal analyst, and our attorneys are respected educators across various platforms. At Lieb at Law, P.C., we continuously adapt to the ever-changing legal landscape, ensuring our clients receive the strategic advantage they deserve.

Why Join Us?
At Lieb at Law, P.C., you’ll be immersed in a dynamic environment from day one, engaging in challenging cases that not only sharpen your litigation skills but also have the potential to shape the legal landscape. We leverage cutting-edge technology, including AI, to enhance our legal strategies and efficiency, allowing you to focus on high-impact work. You will work on cases that extend beyond legal proceedings, offering opportunities to drive policy changes and promote societal progress. Our team is a diverse group of seasoned professionals deeply committed to mentorship and the personal and professional growth of every member.

Job Type: Full-time in Smithtown, New York

Pay: $115,000.00 - $165,000.00 per year

Email CAREERS@liebatlaw.com to apply. 

DOJ just launched the Corporate Whistleblower Awards Pilot Program to reveal and prosecute corporate crime. 

Companies should take advantage of Self-Disclosure to earn a presumption of a declination – avoidance of prosecution – by voluntarily notifying the DOJ of corporate misconduct initially reported to them by internal whistleblowers.

In order to qualify for a declination under the DOJ’s Corporate Enforcement and Voluntary Self-Disclosure Policy, companies must self-report the business’s misbehavior unearthed internally within 120 days of that whistleblower report. Additionally, the company self-reporting must occur prior to the agency contacting them and the company must pay out the amount that would be forfeited, unlawfully obtained funds, as well as any victim compensation payments stemming from the corporate misconduct.

All employers should immediately update their internal policies to motivate corporate self-reporting and internal whistleblowing by workers.

In ruling that College Athletes may be entitled to sue for unpaid compensable work and recover minimum wages, plus double damages called liquidated damages, and attorneys' fees, for the prior 2-years (3-years if violations were found to have been willful), the 3rd Circuit Court of Appeals, in Johnson v. NCAA, held "that college athletes may be employees under the FLSA when they (a) perform services for another party, (b) “necessarily and primarily for the [other party’s] benefit,” Tenn. Coal, 321 U.S. at 598, (c) under that party’s control or right of control, id., and (d) in return for “express” or “implied” compensation or “in-kind benefits,” Tony & Susan Alamo Found., 471 U.S. at 301 (quotation omitted)."

This is the biggest decision to impact college sports since the NCAA responded to the SCOTUS decision in NCAA v. Alston by allowing athletes to profit from their name, image, and likeness (NIL) with direct endorsement deals followed by the National Labor Relations Board (NLRB) taking the position that college athletes are employees for purposes of the National Labor Relations Act (NLRA) and forming unions / engaging in concerted activity. 

Yet, the biggest takeaway from Johnson v. NCAA isn't the newsworthy headline about college athletes, but instead, its analysis of what types of work must be paid, for everyone. 

Simply, the Circuit Court has instructed us that in most instances, "efforts that provide tangible benefits to identifiable institutions deserve compensation." In fact, the Circuit Court dispensed with the NCAA's nonsensical argument that the students were paid in other forms by receiving "increased discipline, a stronger work ethic, improved strategic thinking, time management, leadership, and goal setting skills, and a greater ability to work collaboratively" because those benefits "are all exactly the kinds of skills one would typically acquire in a work environment." In all, the Circuit instructed to always "look to the economic realities of the relationship," "upon the circumstances of the whole activity," when determining if a person is defined as an employee entitled to payment for work. Additionally, it is true that an employee must be promised or expect compensation for their work, but importantly, that compensation is not limited to money and can be instead, the receipt of in-kind benefits, where the promise or expectation can be implied and needn't be expressly stated / written. 

Johnson is a big win for unpaid workers everywhere in the US. 

Whistleblowers are not blocked from NDAs.

The Consumer Financial Protection Bureau (CFPB) released Consumer Financial Protection Circular 2024-04, which warns that NDAs may violate whistleblower laws if they do not have appropriate carve-outs. 

A provision of the Consumer Financial Protection Act (CFPA) safeguards whistleblowers from retaliation by financial firms for reporting financial misconduct that violates the CFPA.

The CFPB’s circular noted that companies may impose NDAs on employees for permissible reasons (such as the protection of sensitive trade secrets), but they need to explicitly afford employees the freedom to communicate or cooperate with law enforcement regarding internal misconduct could disincentive whistleblowing and violate federal whistleblower laws such as the CFPA.

To read the whole circular, click here.

To contact an attorney today

On July 18, 2024, the Consumer Financial Protection Bureau and 4 other government agencies issued guidance to financial institutions about Reconsiderations Of Value (ROVs) in the real estate lending process to avoid litigation for deficient valuations. 

ROVs are valuation reports, which includes reconsideration of appraisals, evaluations, and other means to determine the value of residential property. Specifically, ROVs are a response to a request for a follow-up valuation, after an initial valuation exists to gauge the value of real estate or loan collateral offered by a party seeking a loan. 

The guidance suggests policies and procedures for lenders to address information unconsidered in an initial valuation or identify flaws in an original valuation because accurate valuations of collateral are key to the lending process and avoiding litigation.  

A valuation may be deficient due to unlawful discrimination under both the Equal Credit Opportunity Act (ECOA) and the Fair Housing Act (FHA). In fact, the guidance suggests that complaints of discrimination should be addressed by routing those complaints "to the appropriate compliance, legal, and appraisal review staff," in addition to processing the ROV. Such unlawful valuations can prevent the acquisition of loans lenders, blocking potential buyers from purchasing or refinancing homes. 

To read the entire guidance, click here. 

Welcome to the age of AI Discrimination Regs. Do you have an auditing program in place? 

On July 11th, 2024, the New York State Department of Financial Services (DFS) released Circular Letter No. 2024-7 about the expectations for insurers in NYS regarding the use of Emerging Consumer Data & Information Sources (ECDIS) & Artificial Intelligence Systems (AIS) in underwriting and pricing insurance policies.

The goal of these guidelines is to ensure that all insurers adopt & manage ECDIS, AIS, & other predictive models responsibly because these models come with potential systemic biases & reliability issues that could lead to unfair discrimination or adverse effects on vulnerable communities.

Keys:

• Insurers must ensure that ECDIS & AIS complies with all relevant federal / state laws & regulations.
• Use of these models should not result in unfair discrimination, which means that data sources or models do not rely on protected classes & do not produce unfairly discriminatory outcomes.
• Use of ECDIS & AIS must be supported with generally accepted actuarial standards, demonstrating a clear, statistically significant relationship between variables used & risk.
• Insurers must regularly test & document their methodologies to ensure compliance with anti-discrimination laws & to maintain transparency.
• Effective governance frameworks should be established, with senior management & board oversight to manage the risks associated with these technologies.

DFS notes that transparency is crucial with ECDIS and AIS. Insurers must disclose to consumers whether these technologies are used in underwriting or pricing decisions & provide the specific data that influenced these decisions. 

When it comes to third-party vendors, insurers are responsible for understanding & ensuring compliance of any third-party tools, ECDIS, or AIS used. This includes having contracts that allow for audits & cooperation with regulatory inquiries.

If you'd like to read DFS's Circular Letter No. 2024-7 click here. 

The Consumer Financial Protection Bureau (CFPB) proposed new rules on July 10, 2024 that would obligate large mortgage servicers to help homeowners/borrowers avoid foreclosure, expand access to borrowers seeking mortgage payment assistance, and strengthen communication between borrowers and servicers.

These rules would mandate servicers to do everything they can to provide payment assistance to borrowers before they can seek foreclosure while also speeding up servicers’ evaluations of borrowers’ eligibility for assistance by greenlighting such reviews once borrowers provide some documentation rather than requiring the submission of a complete application.

Further, the amendments would mandate prompt status updates on borrowers’ applications and require servicers to broadly construe what qualifies as a request for assistance.

The new provisions would also obligate servicers to communicate with borrowers in their preferred language in certain circumstances as well as to include guidance about how to obtain information about payment assistance in notices sent after missed payments.

On June 28, 2024, New York State Governor Kathy Hochul signed into law A6138, which clarifies that individuals bringing untimely or inadequately filed lawsuits for sexual offenses revived by the Adult Survivors Act (ASA) under three other laws are not required to file a notice of claim or notice of intention to file a claim beforehand when such suits are brought against the Government. 

While the ASA provided that sexual offenses claims can be revived even if the statute of limitations period passed or a notice of claim went unfiled, the ASA did not directly amend the specific laws such revived suits are brought under to eliminate these procedural hurdles. 

The Bill clarifies that individuals bringing procedurally flawed claims revived by the ASA under the Court of Claims Act, General Municipal Law, and Education Law, specifically, are not required to file a notice of claim or intention to file a notice of claim prior.

This clarification went into effect immediately and applies to lawsuits either pending on or brought after June 28, 2024.

In this interview with Scripps News, Attorney Andrew Lieb discusses the protections for older workers from discrimination under Federal and New York State laws. 

Key points include:

• Individuals aged 40-69 are fully protected and cannot be forced out of their positions due to age.
• Executives over 65 can be required to retire if they meet certain payment standards.
• In New York, everyone 18 and older has these protections and more.
• Companies can mandate physical or mental tests for employees if they are relevant to the job's essential functions and uniformly applied.

On June 6, 2024, the New York State Senate passed Bill S4467, to clarify the state’s anti-discrimination law, the New York State Human Rights Law (“NYSHRL”). 

Under the law, a plaintiff only needs to prove that unlawful motivation was a motivating factor and not "the sole motivating factor" or a "but-for cause" of the challenged treatment. 

This clarification allows mixed-motive claims to succeed by showing that discrimination was one motive driving a negative work-related decision. 

This Bill addresses an issue with age discrimination where it was unclear if New York mirrored the standard from federal law, the Age Discrimination in Employment Act, which requires sole motivating factor. Clearly, the legislature knows that all victims of discrimination in New York need to be treated the same with the same standards. 

This clarification will go into effect immediately once passed by the New York State Assembly and signed by the Governor. 

If you’d like to read more, click here. 

To contact an Associate Attorney see below.

Ready for a big jump in being entitled to overtime pay, which is 1.5 times pay?

The Department of Labor has set new effective earnings thresholds to be entitled to overtime pay per 29 CFR 541.  

Starting on January 1, 2025, we are moving the Fair Labor Standards Act (FLSA) from an entitlement to overtime pay for those making under $35,586 to those making under $58,656 per year ($1,128 per week). Note that this threshold does not apply to employees who are "bona fide executive, administrative, or professional capacity . . . or in the capacity of [an] outside salesman," which terms are defined at 29 CFR 541.

These numbers are particularly important because a worker who is not paid properly can recover 2X back wages (liquidated damages) on unpaid overtime from the prior 2 years. 

Title IX's anti-discrimination obligations on elementary schools, secondary schools, postsecondary institutions, and other recipients of federal financial assistance have been updated and become effective August 1, 2024, by regulation 89 FR 33474 (34 CFR 106)

Title IX states that “No person in the United States shall, on the basis of sex, be excluded from participation in, be denied the benefits of, or be subjected to discrimination under any education program or activity receiving Federal financial assistance,” absent certain exceptions. 20 U.S.C. 1681.

Consistent with Title VII's SCOTUS decision in Bostock v. Clayton County, the regulations define sex broadly to "include[] discrimination on the basis of sex stereotypes, sex characteristics, pregnancy or related conditions, sexual orientation, and gender identity" in § 106.10.

The regulations have been updated for the following purposes:

• "to provide greater clarity regarding: 
• the definition of “sex-based harassment”; 
• the scope of sex discrimination, including recipients' obligations not to discriminate based on sex stereotypes, sex characteristics, pregnancy or related conditions, sexual orientation, and gender identity; and 
• recipients' obligations to provide an educational environment free from discrimination on the basis of sex."
• to ensure that "recipients' procedures for investigating and resolving complaints of sex discrimination are fair to all involved." 

The Federal Trade Commission (FTC) has just issued a Non-Compete Clause Rule banning all Non-Competes. 

This Final Rule provides that it is an unfair method of competition for persons to, among other things, enter into non-compete clauses. While this Final Rule does not include a salary threshold, it does allow for non-competes when a business is sold, and also allows existing non-competes to be enforced for senior executives.

So, existing non-competes for workers, who are not senior executives, are no longer enforceable (retroactively undoing contracts). Is that a violation of due process / impermissible taking for employers? Are constitutional challenges next?  

Yet, the most interesting paragraph of the Final Rule reads:

Non-solicitation agreements are generally not non-compete clauses under the final rule because, while they restrict who a worker may contact after they leave their job, they do not by their terms or necessarily in their effect prevent a worker from seeking or accepting other work or starting a business. However, non-solicitation agreements can satisfy the definition of non-compete clause in § 910.1 where they function to prevent a worker from seeking or accepting other work or starting a business after their employment ends. Whether a non-solicitation agreement—or a no-hire agreement or a no-business agreement, both of which were referenced by commenters, as discussed previously—meets this threshold is a fact-specific inquiry. The Commission further notes that—like all the restrictive employment agreements described in this Part III.D—non-solicitation agreements, no-hire, and no-business agreements are subject to section 5’s prohibition of unfair methods of competition, irrespective of whether they are covered by the final rule. 

Moving forward, non-competes are mostly gone, but non-solicitation agreements, no-hire, and no-business agreements are clearly also on the chopping block where the utilization of each could easily result in protected litigation as to whether they are covered by the Final Rule or generally by section 5's prohibition of unfair methods of competition.

You can read the FTC's press release here.

You can read the Final Non-Compete Clause Rule here.  

The Federal Government recently passed the Pregnant Workers Fairness Act (PWFA), which significantly strengthens protections for pregnant workers and enhances the process for addressing discrimination claims related to pregnancy and related medical conditions in several ways including:

• Clear Prohibitions: The PWFA explicitly prohibits discrimination against pregnant employees, including adverse actions, denial of employment opportunities, and coercion. This clarity empowers pregnant workers to assert their rights without fear of retaliation.
  
• Mandatory Reasonable Accommodations: Covered entities are required to make reasonable accommodations for pregnant employees unless it causes undue hardship. This ensures that pregnant workers can continue working without facing unnecessary barriers due to their pregnancy or related medical conditions.

• Interactive Process Requirement: The Act mandates an interactive process between employers and employees to determine appropriate accommodations. This process promotes transparency and collaboration, ensuring that accommodations are tailored to meet the specific needs of pregnant workers.
  
• Expansive Definitions: The PWFA provides comprehensive definitions of terms such as "known limitation" and "related medical conditions," broadening the scope of protections for pregnant workers. This clarity reduces ambiguity and strengthens the basis for discrimination claims.
  
• Limits on Supporting Documentation: The Act imposes limits on the type of supporting documentation employers can request from pregnant employees seeking accommodations. This prevents employers from creating unnecessary barriers or burdens for pregnant workers seeking to exercise their rights.

• Anti Competitive Practices
• Breach of Fiduciary Duty
• Commission Disputes / Affidavits of Entitlement
• Fair Housing & Discrimination
• False Advertising
• Fraud / Fraudulent Inducement
• License Law Violations and Administrative Complaints before the Government
• NAR / REBNY Ethics & MLS / RLS Complaints
• Subpoenaed Non-Party Witness Representation

Contact Lieb at Law today.  

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