The real estate industry on trial

Planet Money

NPR

Business, News

4.6 • 29.8K Ratings

🗓️ 3 April 2024

⏱️ 32 minutes

🔗️ Recording | iTunes | RSS

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Summary

In 2019, Mike Ketchmark got a call. Mike is a lawyer in Kansas City, Missouri, and his friend, Brandon Boulware, another lawyer, was calling about a case he wanted Mike to get involved with. Mike was an unusual choice - he's a personal injury lawyer, and this was going to be an antitrust case.

But Brandon knew Mike was great in front of a jury. And that he'd won huge settlements for his clients in the past.

So the lawyer friend drops by Mike's office, and pitches him the case. Rhonda and Scott Burnett had just sold their home for $250,000 dollars, and out of that amount, they had paid $15,000 in commission (plus a small fee), which was split between two real estate agents - even though they had hired only one. And the commission was high - 6%. Mike's friend said the whole thing seemed... suspicious. Maybe even illegal.

Mike agreed to take the case, a case that would soon become bigger than one about just what had happened to the Burnetts. It would become a fight about the way homes are bought and sold in the U.S. and challenge the way real estate agents have done business for more than 100 years.

This episode was hosted by Amanda Aronczyk and Keith Romer. It was produced by Willa Rubin, edited by Keith Romer, engineered by Valentina Rodríguez Sánchez, and fact-checked by Sierra Juarez. Alex Goldmark is Planet Money's executive producer.

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Transcript

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0:00.0	This message comes from NPR's sponsor, Organic Valley, the farmer-owned cooperative dedicated to providing ethically sourced food from small organic family farms.
0:09.5	Discover how you can support local organic farmers at o v. coop slash ethically sourced.
0:17.0	A little heads up there is some racey geared for adults content in this episode.
0:22.0	This is Planet Money from NPR.
0:25.0	Maybe you've already heard of all the drama going down in the real estate industry lately.
0:33.0	How there have been all of these lawsuits about how realtors get paid.
0:37.5	The big one in the news, Burnett versus the National Association of Realtors. Today we've got the behind the scenes story of what went down.
0:46.4	It starts in 2019 in Missouri with a lawyer named Mike Ketchmark.
0:50.8	What I'm picturing is you at your desk, like a shingle out front, you open the door and a bell rings
0:57.2	and somebody walks in and is like, have I got a case for you?
1:00.7	Is that what happened?
1:01.7	It was my cell phone that one off and one of my really good friends in Kansas City is a lawyer. Brendan Bowler and he called me on a Monday and said, hey, can I stop by your office and talk to you about a case I want to get you involved then
1:14.3	and I said sure. Now Mike was maybe an unusual choice to work on something like this
1:19.2	he doesn't know anything about real estate law he's actually a personal injury lawyer.
1:23.4	I represented families usually in wrongful death cases where somebody had lost their life
1:28.0	because of a tragedy of a product or a work-related tragedy.
1:32.1	The friend wants him on the case because Mike a product or a work-related tragedy.
1:32.6	The friend wants him on the case because Mike is great in front of a jury.
1:36.9	He's got this folksy charm about him, he uses football and barbecue metaphors, and he'd won these huge verdicts, one for the widow of a truck driver who was
1:46.4	killed on the job and another against a corrupt pharmacist and a handful of
1:50.8	pharmaceutical companies. So the lawyer friend drops by Mike's office
1:55.2	and pitches him the case.
	...

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