Despite having long ago settled the commission lawsuits, legal challenges continue to mount for real estate industry giant Anywhere. On Friday, the firm and some of its subsidiaries and agents were accused of violating the federal Racketeer Influenced and Corrupt Organizations (RICO) Act and the Lanham Act.
The lawsuit, which alleges claims of false advertising, was filed in a U.S. district court in Minnesota by plaintiffs Michael and Lauren Campoli. They are demanding a jury trial and more than $75 million in punitive damages and compensation for litigation costs and emotional distress.
According to the suit, the Campolis worked with Mark Grieger, their neighbor and an agent brokered at Anywhere-backed Coldwell Banker Realty, to list their home in Deephaven, Minnesota, for $3.3 million.
Defendants Jesse and Lee Bull then made an all-cash offer on the property through a shell company, Fairways and Greens LLC, that they set up with their broker Joel Burger, who is with Wexford Real Estate. The Campolis allege that the Bulls failed to deposit $100,000 in earnest money as agreed to in the contract, instead forging documentation falsely showing that the money had been deposited.
The suit also alleges that the defendants — which include the brokerages, agents, brokers, support staff, title companies and banks involved in the transaction — coordinated to gain an unfair advantage. They allegedly withheld the earnest money deposit and misused “equitable title” by delaying the cancelation of the deal and using their partial claim on the property to extort money from the Campolis. This included pursuing a sham lawsuit and withholding evidence to avoid exposing their alleged scheme.
The plaintiffs are accusing Coldwell Banker Realty — along with their agent, broker and office support staff — of concealing the fact that the earnest money was never deposited. The accusations also include the forging of documents (such as a fake purchase agreement and fake earnest money deposit records), the breaching of fiduciary duties to the Campolis and the prioritization of their own financial interests in earning a commission for the sale.
The suit alleges that Coldwell Banker Realty took things as far as depositing $100,000 of its own funds into an escrow account to create the false impression that the buyers had in fact made the deposit.
Additionally, the plaintiffs claim that Coldwell Banker Realty’s actions are reflective of systemic issues in the real estate industry, in which brokers fail to uphold fiduciary duties due to financial incentives or conflicts of interest. The Campolis also claim that this behavior violates the Lanham Act. They say Coldwell Banker Realty, Anywhere, and the agents and brokers involved in the transaction falsely claimed that they are trustworthy, reliable, would uphold their fiduciary duties and would act in their clients’ best interests.
The suit also names Anthony Maurer, a former Coldwell Banker branch vice president; Matthew Baker, the former president of Coldwell Banker Realty, MN-Western Wisconsin; and Thomas Rehman, Coldwell Banker’s vice president of sales administration, as defendants.
The other defendants in the suit are those involved in the title and escrow process and the wiring of the allegedly fraudulent funds. These include Burnet Title, a subsidiary of Anywhere Integrated Services; escrow services provider TrustFunds LLC; Northstar MLS; TitleNexus; UBS Financial Services; UBS Bank; UMB Bank; and several employees and executives at these firms.
The defendants in the suit did not respond to HousingWire’s requests for comment.