Midyear Reports: Breaking News from MLS Policy Committee Meetings

This post, and this series of reports and opinions from NAR Mid-Year 2011, brought to you by:

I can report on three major developments at the MLS Policy Committee meeting at NAR Midyear.

Civix Patent Litigation Global Settlement

First, NAR has reached a tentative agreement with Civix, the greenmailer patent owner who has been going around suing various websites, MLS’s, and vendors. Most of you may not be aware, but this company has managed to get a patent issued on local search technology. They’ve been involved in litigation with various companies, and have settled with Realtor.com individually, and a couple of large MLS’s (MRIS for example).

Laurie Janik, the General Counsel of NAR, announced that NAR had reached an industry-wide agreement in principle with the greenmailer patent owner to cover the entire real estate industry. There will be far more details coming forth, but bottomline is that NAR will get a master license of sorts that would cover every MLS/Association and all of their members, as well as all of the software that they use for real estate, from further liability to Civix. The cost is $7.5M, payable in 30/60/90 days. The first payment of $2.5M is due within 30 days; make that payment and there’s a deal. Miss it, and there’s no deal. The lawsuits continue.

The settlement amount is basically $9 per member one-time payment for the remaining four years of Civix’s patent, instead of the $24 over four years that Civix had proposed. So NAR did get a great deal from that standpoint.

Franchise IDX Suspended Until November

The second major news is that the Franchise IDX rule, which brought forth such controversy, has been suspended until the Annual Convention in November. That represents a defeat for the group opposed to Franchise IDX, as it wanted to have the rule rescinded completely, while the supporters (at least Realogy) were open to revising the rule to broaden it. Suspending the rule and referring it back to the workgroup takes repeal off the table, at least until November.

Practically speaking, the suspension means that the franchisors such as Century 21 that have implemented franchise IDX must immediately take down their franchise IDX displays on the national websites. But, because the rule was not repealed outright, if there is no action taken in November at Annual, the rule will automatically go back into effect.

More analysis with much more detail on this later.

Electronic Display IDX Recommendation Fails

Finally, the recommendations of the IDX Data Use Workgroup was not accepted by the MLS Policy Committee. Instead, it was referred back to the workgroup with specific instructions to separate out “social media” from IDX. There was significant concern on the part of commentators and committee members about the lack of broker’s ability to monitor and control listings being put on Facebook, Twitter, and other social media channels.

The practical impact is that agents/brokers/etc. may not put other broker’s listings into any social media channel. For example, tweeting out a new listing that belongs to another agent is forbidden.

Much, much more on this issue later as well.

-rsh