Recent court cases are giving REALTORS® reason to be optimistic in their efforts to curb the unauthorized use of their MLS data.
Two weeks ago the Key West Association of REALTORS® scored a major victory when a U.S. district court judge in Florida levied a $2.7 million fine against a businessman named Robert Allen, whose KeyWestMLS.com and other websites were found to be using the association’s listing data in violation of copyright laws. The large fine is attention-getting, and that was the point, according to the judge, Justice Lawrence King, in his May 22 decision.
“Awarding a lesser amount of damages would not serve the purpose of the Copyright Act in deterrence of further wrongful conduct by Defendant,” the judge wrote. “Absent the maximum statutory award of damages, future potential infringers of Plaintiff’s MLS copyrights will only see the potential benefit of high commissions from ill-gotten leads. As such, the maximum statutory damage amount is necessitated to deter the future conduct of Defendant Allen and others.”
Similar cases are pending in U.S. District Court for the District of Maryland and in U.S. District Court for the District of Minnesota. It’s not clear when the judges will issue rulings on them but in a positive development last week, a judge has dealt a setback to the defendant that’s the subject of both cases.
The company is American Home Realty Network (AHRN) and it was sued last year by Metropolitan Regional Information Systems Inc. (MRIS) for using its MLS listing data without authorization on its website, NeighborCity.com, and then by the St. Paul, Minnesota-based Regional Multiple Listing Service of Minnesota Inc. (NorthstarMLS) on similar grounds.
After the cases were filed, AHRN tried to turn the tables on the two MLSs by filing a counterclaim in each case alleging that the MLSs violated antitrust and other laws in an effort to drive the company out of business. In the Maryland case AHRN also named NAR as a defendant in its counterclaim, asserting that NAR participated in the alleged conspiracy to discourage participation with AHRN.
There were seven counts in AHRN’s counterclaim, and last week in the Maryland case the Court dismissed all of them, although it left the door open for the company to amend three of its those counts and resubmit them for further consideration. The company has until the end of next week to do so, but even if it does it faces a steep hurdle based on some of the language the judge used in his June 10 order. “In light of the deficiencies identified herein,” Justice Alexander Williams, Jr., said, “ the Court has serious reservations about AHRN’s ability to set forth a cognizable [unfair competition] claim against” the MLSs.
It remains to be seen what will ultimately happen with the MLSs’ cases against the company for copyright infringement, but the positive outcomes of this ruling is an encouraging development for MLSs as they try to maintain control of where their listing data is displayed on the Internet.