Antitrust Law Daily Wrap Up, ANTITRUST—E.D. Pa.: Pro se realty professional fails to plead antitrust, other claims against realtor groups, (Aug 1, 2025)

By Justin Marcus Smith, J.D.

The court denied further leave to amend because it had already given the professional an opportunity to amend with a warning about potential dismissal.

A pro se Pennsylvania realty professional (realtor) failed to plead sufficient antitrust and other claims against the National Association of Realtors (NAR) and other local realtor associations, held the federal district court in Allentown, Pennsylvania. The professional’s second amended complaint (SAC) contained only conclusory allegations of antitrust violations, unfair business practices, and racial discrimination. The SAC failed to even allege state action on claims of constitutional violations (Muhammad v. National Association Of Realtors, No. 5:24-cv-05543-JFL (E.D. Pa. July 31, 2025)).

Background. The realtor sued NAR, the Pennsylvania Association of Realtors (PAR), and the Greater Lehigh Valley Association of Realtors (GLVR), for monopolization and discrimination in connection with the multiple listing service (MLS).

On the associations’ motion to dismiss the original complaint, the court advised the realtor to identify all defendants in the complaint caption as well as in the complaint body; to state the basis for his claims against each defendant; and to be mindful of arguments in the motion to dismiss or possibly face dismissal with prejudice.

The realtor filed a SAC asserting claims under Sections 1 and 2 of the Sherman Act; the Fair Housing Act (FHA); 42 U.S.C. §§ 1981 and 1983 for civil rights violations of discrimination, procedural, and substantive due process; and Pennsylvania’s Unfair Trade Practices and Consumer Protection Law (UTPCPL).

More specifically, the realtor alleged NAR MLS access fees were “excessive”; the NAR membership requirement for MLS access restricted competition amounting to illegal monopolization and violation of the UTPCPL; financial barriers kept many, especially minority-owned businesses, out of the industry; the associations selectively enforced their rules based on race; he and others were unfairly targeted for discipline in comparison with similarly situated non-minority professionals; and, among other things, he was ultimately “coerced into almost relinquishing” his agent license.

The associations filed a new motion to dismiss the SAC for failure to state a claim. The court analyzed and dismissed each claim, with prejudice.

Individuals dismissed. The court held the realtor failed to state a claim against the individual defendants because he referred to term collectively and in conclusory terms.

Sherman Act claims. The realtor’s Sherman Act Section 1 claims failed because the SAC was “completely devoid” of any factual allegations suggesting a price-fixing arrangement or otherwise suggesting conspiracy, agreement, or concerted action among the defendants. Vague and conclusory allegations failed to show unreasonable restraint of trade.

Although the realtor’s allegations about a policy of restricting access to MLS data to NAR members stated a tying claim and group boycott claim, numerous courts have declined to hold an antitrust violation is present where an MLS merely conditions access to the MLS service on membership in a board of realtors. The rule of reason applied here. The realtor bore the burden of showing adverse, anti-competitive effects within a relevant product and geographic market, but allegations of “forced,” “mandatory,” or even “excessive” membership fees were insufficient to show foreclosure of competition.

Many of the “excessive” fees allegations pertained to fines and penalties for ethics violations, not membership costs. Without allegations about the cost of NAR membership, how NAR set the cost, or that it was unrelated to maintaining NAR services or operational costs, the realtor failed to show that cost prohibited him from becoming a NAR member or that the requirement was anticompetitive. The court dismissed the Sherman Act Section 1 claim.

The Section 2 monopolization claim failed because the realtor did not allege sufficient facts to show that NAR, PAR, and GLVR had monopoly power. He did not allege the existence of either direct or indirect evidence that the defendants had both a dominant share in the relevant market and that significant entry barriers protect that market. The SAC alleged NAR control of millions of real estate professionals. The court could glean at least that much, but in relying on market share as a proxy for monopoly power, the realtor failed to plead high entry barriers. The SAC did not allege NAR membership fees were unrelated to NAR costs. The allegations about excessive fees were conclusory, and ethics fines and penalties did not have to do with entry.

Even assuming the defendants had monopoly power, the allegations did not show willful acquisition of it through anticompetitive conduct. The court dismissed the Section 2 monopolization claim after continuing its analysis at length.

The attempted monopolization claim fared no better because, among other things, the SAC failed to allege or even identify competitors in the relevant market, the strength of competition, or that NAR had a dangerous probability of achieving monopoly power.

FHA claim. The court dismissed the FHA claim because the realtor failed to allege facts to show the defendants acted out of a racial motive. He did not allege any direct or indirect evidence of intentional discrimination, so he did not state a sufficient FHA claim for disparate treatment or intentional discrimination.

The realtor also failed to state an FHA disparate impact claim. The only policy the SAC identified was the requirement that brokers have NAR membership to access the MLS. The allegations here were wholly conclusory. The realtor did not allege anything, like statistics, to show how frequently minority brokers, if any, were forced out of business or otherwise unable to obtain NAR membership in comparison to white realtors. And again, allegations about “excessive” fees were wholly conclusory.

§ 1981. The court held the § 1981 failed because the SAC did not allege sufficient facts to show the defendants intended to discriminate on the basis of race. Again, the allegations were conclusory. The mere suggestion of harsher treatment compared to similarly situated brokers was not enough to state a claim. The SAC did not offer any facts about the respective ethics complaints, penalties, or brokers. The court dismissed the § 1981 claim.

§ 1983. The § 1983 claim alleging violation of due process and equal protection failed because the SAC did not suggest the defendants were state actors and did not allege state action. Allegations about state-like licensing and authority were “contradictory and conclusory.” Even assuming there was state action, the § 1983 claim related to ethics proceedings that did not arise from a policy, custom, or practice. The court dismissed the § 1983 claim.

UTPCPL. The court held the realtor lacked standing to bring a UTPCPL claim. The allegations had nothing to do with goods or services bought for family or household services. Everything related to a professional license.

In any event, the realtor failed to state a UTPCPL claim because he failed to allege facts, apart from conclusory statements, showing deceptive conduct or statements.

No amendment. The court denied amendment because the realtor already had multiple opportunities to state a claim and a warning about potential dismissal. The court dismissed all claims with prejudice, including as to anonymous defendants.

The Case is No. 5:24-cv-05543-JFL.

Judge: Leeson, Jr., J.

Attorneys: Maurice Muhammad, pro se. James J. Scanlon (Norris McLaughlin, P.A.) for National Association of Realtors [Nar].

Companies: National Association of Realtors (Nar)

Cases: Antitrust StateUnfairTradePractices PennsylvaniaNews