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The Color of Money

Follow-ups and reaction

Black Agents File Suit Alleging
Realtors' Rule Biased Against Blacks

By Bill Dedman, The Atlanta Journal-Constitution

Published December 28, 1988, Page A1

Copyright 1988, The Atlanta Journal-Constitution

Until the 1960s, the Code of Behavior of the National Association of Realtors prohibited blacks from becoming Realtors and barred white Realtors from selling homes in white areas to blacks.

The code crumbled in the civil rights era, but Atlanta's black real estate agents have filed suit in federal court claiming the Realtors enforce the code through a new mechanism: the computer networks that list homes for sale.

The Realtors control Metro Listing Service, the only computer network to cover all of metro Atlanta. Metro is owned by the DeKalb Board of Realtors, and no one can join Metro without first joining a chapter of the Realtors.

Black real estate agents are no longer prohibited from becoming Realtors, and some have joined, but many prefer to be what they call Realtists, belonging to the predominantly black National Association of Real Estate Brokers. The Realtors and the Realtists have nearly identical membership requirements, codes of ethics and continuing-education courses.

That choice is expensive.

"Trying to sell real estate without being in Metro Listing Service is like trying to sell real estate without an automobile," said Fletcher L. Thompson, a black owner of a real estate agency on Old National Highway near College Park.

In May, Mr. Thompson mailed an application and a $2,225 cashier's check to Metro to cover the initiation fee, four months' dues and the computer terminal that would allow him to share listings with 6,000 other Metro member agents.

"I need that computer terminal," Mr. Thompson said. "I have six Metro members I compete with near my office. By the time I find out a property is for sale, it's been sold."

Metro's attorney mailed back Mr. Thompson's check with a letter: "Mr. Fletcher L. Thompson's application for membership is being returned due to Mr. Thompson not being a member of a Board of Realtors. . . . We extend an invitation to Fletcher L. Thompson to apply for membership in the Board of Realtors. . . . "

Mr. Thompson, 40, has been a licensed real estate agent for five years and a broker for one year. Now he is also a plaintiff, joining the Empire Real Estate Board, the Atlanta affiliate of the Realtists, in a suit filed Thursday in U.S. District Court in Atlanta. The suit names as defendants Metro Listing Service, its parent company, Metropolitan Multi-List Inc., and its owner, the DeKalb Board of Realtors.

The suit claims the membership rule violates two federal laws.

Claiming a violation of the Sherman Antitrust Act, the plaintiffs argue that Metro and the Realtor boards conspired to restrain trade by requiring purchase of one product, a Realtor membership, for access to another product, the real estate listings, on which it holds a monopoly. The plaintiffs claim Metro has no sufficient business purpose for requiring a Realtor membership as a prerequisite for a Metro membership.

The plaintiffs also argue that the membership requirement violates the federal Fair Housing Act. They claim it has a discriminatory effect on Realtists since blacks are underrepresented in the Realtor associations, and a discriminatory effect on black homebuyers, because their Realtists do not have access to the service.

"White homebuyers who go to white Realtors won't be aware of homes for sale in black areas," said the attorney for the black agents, William E. Sumner. "Black homebuyers who go to black Realtists won't be aware of homes for sale in white areas."

The suit seeks triple damages, as allowed under antitrust law, for damage to Thompson's business and also for damage to the Empire association, which claims to have lost members to the Realtors.

The suit also seeks an injunction ordering Metro to admit Thompson and barring Metro from enforcing the rule against others.

Why don't the Realtists just join the Realtors?

"First, why should I have to?" Mr. Thompson said Tuesday. "I'm black, most of my clientele is black, I belong to the black board. Most of the other boards are white. I have no affiliation there.

"Second, I would still belong to Empire, which costs $175 a year, and I'd have to join Atlanta, which is another $363 a year."

His attorney, Mr. Sumner, cited a third reason.

``Some of the Empire members, particularly the older members, find it offensive to be forced to join an organization that for years was, by constitution, whites only."

Metro officials say they are merely following the policy of the National Association of Realtors.

A spokesman for the Realtors confirmed that the policy exists, but only because Realtors want to be sure that members of listing services agree to their code of ethics.

"Anyone, black or white or whatever, can join the DeKalb Board of Realtors. I understand that in the '50s there were rules, and those rules were extremely unfortunate, and those rules were done away with 20 years ago," said Robert D. Butters, deputy general counsel for the Realtors in Chicago.

"It is true that our membership doesn't contain as many black members as we'd like, but the Realtists are free to join. And if the Realtists want to have their own multiple-listing service, they could if they wished to."


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Reprinted with permission from The Atlanta Journal and The Atlanta Constitution. Further reproduction, retransmission or distribution of these materials without the prior written consent of The Atlanta Journal and The Atlanta Constitution, and any copyright holder identified in the material's copyright notice, is prohibited.


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