No one can predict the future of real estate, but you can prepare. Find out what to prepare for and pick up the tools you’ll need at Virtual Inman Connect on Nov. 1-2, 2023. And don’t miss Inman Connect New York on Jan. 23-25, 2024, where AI, capital and more will be center stage. Bet big on the future and join us at Connect.
HomeServices of America on Wednesday formally filed a motion requesting a mistrial in the Sitzer | Burnett commission trial, arguing that a video played in court a day earlier by the plaintiffs’ attorney amounted to an “ambush” that severely jeopardizes the real estate franchisor’s chances for a fair trial.
Attorneys for the National Association of Realtors and Keller Williams also said Wednesday that they wanted Judge Stephen R. Bough to declare a mistrial, with NAR attorney Ethan Glass saying he wanted the case to be dismissed entirely.
“We are not asking for a new trial,” Glass said.
Attorneys for the HomeServices filed the motion following a decision by attorney Michael Ketchmark on Tuesday to play a segment from a video of a Tom Ferry podcast interview with Allan Dalton, the CEO of Real Living Real Estate and senior vice president of Berkshire Hathaway HomeServices. During the segment, which defendants allege was not provided in discovery prior to the trial, Dalton compared agents who agree to lower commissions to “hookers” offering their services to “sailors.”
“There’s no bleeping bleeping way I’m going to cut my bleeping bleeping commission,” Dalton says in the video, attributing the script to an unnamed Realtor and substituting the word “bleeping” for what he said would actually be profanity. “What do you think, I’m a bleeping bleeping hooker standing outside the Lincoln Tunnel at three o’clock in the morning giving bleeping bleepings to sailors?”
“If you think I’m going to cut my bleeping bleeping commission, you can take this home and shove it up your bleeping bleeping and I know that it will fit,” Dalton says in the video, which was recorded in September 2019, months after Sitzer | Burnett was filed.
The video wasn’t on the plaintiffs’ list of exhibits, attorneys for the various real estate industry defendants said. They then went on to list a series of occurrences in and out of court that they said should prompt Bough to declare a mistrial and start the proceedings over with a new jury. It is not uncommon for attorneys litigating major trials to make mistrial requests during the proceedings.
Robert MacGill
“Plaintiffs’ ambush with the highly-prejudicial video is just the most recent event in a series of violative actions,” attorney Robert MacGill, lead counsel for HomeServices, wrote in his motion. “Each and all of them result in the inescapable conclusion that this case has been mistried.”
MacGill said defense attorneys should have been given the opportunity to depose Dalton and Ferry for more context around Dalton’s statements, or to bring them to testify during the trial.
“It is too late to remedy any of these prejudicial factors in the context of this trial,” MacGill wrote. “A mistrial must be granted.”
Bough asked plaintiffs’ attorneys to respond in writing, and plaintiffs’ attorneys responded before the end of the day denying the allegations made in the HomeServices filing.
“HomeServices bears a heavy burden in seeking a mistrial and has not come close to meeting it,” attorney Scott McCreight, a colleague of Ketchmark.
Among the other arguments in favor of a mistrial, MacGill said Ketchmark’s mention of an Inman article to the eight-member jury encouraged them to go research the case outside the courtroom. There, jurors would have found extensive and timely coverage of the trial.
Bough polled the jurors on Wednesday morning after they were seated to see whether any of them had read any news articles about the case. Each of them said, “No.”
Timothy Ray | Attorney for Keller Williams
The judge told them he was “instructing you to disregard any reference to Inman.”
Timothy Ray, an attorney representing Keller Williams, was most concerned with Inman’s article about NAR’s recent decision to allow listing brokers to offer buyer brokers nothing in compensation.
“It’s highly prejudicial to wave it around as if it’s a legitimate news story,” Ray said.
The defendants’ attorneys also said Ketchmark referenced investigations by the Department of Justice in front of the jury “despite being ordered not to.”
Additionally, the attorneys took issue with Ketchmark’s statement that defendants should “be careful when the rabbit gets the gun,” calling that statement one of multiple “extrajudicial threats and inappropriate characterizations” of the defense attorneys in the case.
If the requests to dismiss or start over aren’t granted, MacGill asked Bough to strike the Dalton video from the record. That means the judge instructs the jury to give the video no weight during their eventual deliberation.
He also asked Bough to strike from the record all references to Inman, all references to the Department of Justice, all references to where NAR’s attorneys live, all references to NAR executive pay, and all references to any action by regulatory authorities.
Michael Ketchmark | Plaintiffs’ attorney
McCreight wrote two responses defending plaintiff attorneys’ conduct on Tuesday and Wednesday. In both, defended airing the Dalton video. He said the defendants didn’t object to the video when it was being played while HomeServices founder and chairman emeritus Ron Peltier was on the stand.
“Only after the video concluded did Defendants ask to approach” the bench, McCreight wrote. “When they did, they offered no objection based on the rules of evidence. Rather, counsel for HomeServices just claimed lack of notice. The Court overruled that objection.”
McCreight said that defense attorneys never asked for the Dalton video during discovery. Instead, he wrote, HomeServices should have given the plaintiffs the video themselves.
“Plaintiffs asked HomeServices to identify its personnel most knowledgeable about training, but HomeServices never disclosed Dalton,” McCreight wrote. “Plaintiffs asked HomeServices to produce all training materials, but HomeServices failed to produce a video of its Vice President giving training advice to a leading real estate instructor who ‘trains every broker brand in the country.’”
McCreight wrote in a Tuesday letter to Bought that the court’s scheduling order didn’t require the plaintiffs to include exhibits that would be used for “impeachment and rebuttal purposes,” and that HomeServices never asked for the video during discovery.
“For all these reasons, HomeServices’ accusations of discovery violations are without merit,” McCreight wrote. “To the extent that HomeServices asks the Court to strike testimony (or for any other relief), that request should be denied.”