Berkshire Hathaway Energy (BHE), the parent company of real estate brokerage firm HomeServices of America, has asked Judge Stephen R. Bough to reconsider a previous ruling and for an order to compel arbitration in the Gibson copycat commission lawsuit.
In a document filed last week, BHE asked Bough to reconsider his order denying BHE’s motion to strike the class-action allegations and to dismiss for failure to state a claim. The company is also asking the court for an order to compel arbitration.
BHE was named as a defendant in the suit in March 2024.
In the filing, BHE said that in its previous order, the court found that the company “could not enforce arbitration and mediation agreements and class action waivers that absent putative class members may have signed because those agreements did not expressly identify BHE.”
The court made this ruling despite none of the named plaintiffs having sold property through a subsidiary of HomeServices of America. The ruling came about as the U.S. District Court for the Western District of Missouri and the Eighth Circuit Court of Appeals had previously found that the similar agreements at issue in the Sitzer/Burnett suit could not be enforced.
A new agreement executed after the rulings issued by the district court and the appeals court “identified HomeServices as the ‘ultimate parent’ and thus precluded BHE from enforcing them, even though the New Agreements also expressly covered ‘affiliates.’”
BHE claims that this order “contains significant and manifest errors of both fact and law,” and that the court failed to provide a ruling on BHE’s reasoning for dismissal, such as “the absence of any plaintiff who is able to allege a single fact with regard to conduct by BHE.”
BHE is also asking for an order from the court compelling arbitration. The defendant argues that some of the plaintiffs likely entered into contracts with HomeServices subsidiaries or franchisees that included mandatory arbitration provisions, meaning that their contract explicitly requires disputes to be resolved through arbitration instead of court.
Additionally, BHE claims that under the Federal Arbitration Act, arbitration agreements are legally enforceable. BHE said it is invoking this law to request that any claims brought against it in the suit be resolved through arbitration. The company also said it feels it would be unfair to litigate a case related to contracts containing arbitration provisions without being allowed to enforce these provisions.
In the Sitzer/Burnett suit, HomeServices ultimately filed a writ of certiorari with the Supreme Court over the Eighth Circuit’s ruling on its arbitration agreements. The Supreme Court ultimately denied the company’s request.
