First Amendment, restraint of trade and other musings

What are the rights of a member of a private organization like the National Association of Realtors (NAR) to speak candidly and publicly on the merits of a specific property? Depending on the outcome of today’s super-secret double-probation grievance hearing I endured today, I may have occasion to find out. Until now, the First Amendment was of academic interest to me but that may change.

On the one hand, a private organization can probably limit the free speech of its members to some extent – can you denounce the President of your country club without penalty, for instance? I think not. And, as a member of the NAR, I am bound to follow their ethical rules if I want to remain a member.

But membership in the NAR is not voluntary – I must belong if I want to sell real estate in Greenwich and I suspect that places membership, and the rights I give up, in a less powerful position vis a vis limiting my speech.

And then there are anti-trust considerations. Can the NAR, under the guise of enforcing an ethics rule, prevent a member from publicly opining on the relative values of specific properties? That may protect one group: sellers, but disadvantages the other half of the equation, buyers. I would think that shutting off that speech would constitute a restraint of trade, cutting buyers off from an objective (even, for the sake of argument, subjective) source of information on which to base, even partly, their decision to buy.

As noted, I am not a first Amendment scholar, and, pending a decision on sanctions that may or may or may not be levied against me, I don’t want to become one. But I certainly don’t intend to stop blogging or selling real estate, so if worse comes to worse, my legal education may continue.

This could be of interest to other people, because I am not the only real estate agent blogging out there nor am I the only member of a non-voluntary organization who blogs on matters that may be proscribed by an organization’s rules. I am headed to Europe tomorrow and blogging will be light or non-existent, depending on Internet access but I’ll be back, and we can resume the discussion then. In my absence, any First Amendment lawyers out there or you, Walter, over there at Overlawyered.com,  who wish to chime in, please fire away.

27 Comments

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27 responses to “First Amendment, restraint of trade and other musings

  1. DB

    As with many lawsuits or threats related to them, the idea is to cause enough of a hassle that you give up, or make you extremely cautious in what you post.

    In this case, you happen to have a law degree, though the work involved in dealing in something outside your expertise isn’t small.

    Truly hope you fight, since the loss of a blog this honest would really suck (in layman’s terms.).

  2. HG

    “membership in the NAR is not voluntary – I must belong if I want to sell real estate in Greenwich”

    If your question is whether you are free, I think you have answered your own question. But luckily the same type of regulations protect you against a bad haircut (barber licenses), blurry glasses (opticians), being improperly taught to read (adult literacy instructors), being incompetently represented in negotiations over your next album contract (talent agents), crashing in a plane (pilots, one I happen to agree with), having your domestic animal improperly inseminated (animal breeders), trees trimmed willy-nilly (arborists), receiving quack remedies improperly applied (chiropractors) and buying bad stocks (securities broker licenses).

    I recommend seeing if there is any administrative case law from, perhaps, a barber somewhere who has blogged nastily about about haircuts of his fellow guild members.

  3. Anonymous

    Does one have to be a Greenwich broker to list, represent for sale, and represent buyers in the Greenwich market?

    Are there other locales which don’t require brokers to be members of NAR?

    Could you be one of those sought after “out of town” brokers and meanwhile continue on your merry way, blogging and selling real estate for Fontanski and Fudrucker as an “out of town” agent?

  4. Anonymous

    As in a newspaper or I believe a blog (which is a public medium) Absence of malice, you can print anything you want……(under the first amendment.)

    We learned this in the 8th grade….I may be wrong but I do not think the NAR has overturned our constitution. (I know they are a powerful lobby)

    I am not a lawyer but I would think if the NAR retaliates or restrains your right to free speech, you will have a hell of a law suit on your hands and make so much money you will never have to sell Real Estate again!……

  5. Wally

    Best of luck and have fun in Italy, the most beautiful country in the world. Depending upon where you stay, you should find internet access to be good, but the time difference will make it interesting. And hopefully you will have more interesting things to do in that wonderful country than sit at a computer!

  6. Anonymous

    Hope those smelly Euros don’t detain you for your recent comments re: their hygiene (or lack thereof)

    Seriously, free speech doesn’t really exist in any continuing, active business in world; one is ultimately regulated by reactions of one’s employers, customers, suppliers, competitors, employees, shareholders, etc etc to any comments (or even one’s lifestyle choices like cars or attire, whether too lavish or too frugal or too “abnormal”): far more powerful controls on “free speech” or lifestyle than any supposed Constitutional freedoms

  7. Red

    How deeply ironic it would be if the NAR managed to drive you, Chris Fountain, into a beneficial alliance with the ACLU. You can ponder that as you gaze off into the Adriatic. We (well, most of us) will eagerly await your return.

    • christopherfountain

      It’s why I always had a soft spot in my heart for Jehovas Witnesses, Red. Many of our most important 1st Amendment cases arose from them!

  8. Anonymous

    Have a great trip!!!

  9. Retired IB'er

    I am not a lawyer, but I fail to see what you have done wrong or, for that matter, a legal cause of action.

    Leaving aside 1st amendment issues, this blog is a legimate forum for you to showcase your services/skills/knowledge as a Realtor.

    In that regard, you are demonstrating to prospective buyers or sellers your knowledge of your local market. Your comments/observations allow future clients to see your approach to sizing up the pros and cons of a particular property (including issues that may affect resale, i.e. decor for example) as well as your current views on value along with future trends in the marketplace affecting value, among other things.

    All of these and more, I would expect from my broker; otherwise you are solely an ordertaker providing little value-added.

    Finally, I assume you have said nothing more in this blog (and most likely a lot less) than you would say to me about a particular property if I had retained you to help me purchase a property.

  10. Lorin

    Jehovah’s… ; )

    • christopherfountain

      Now Lorin, just because Hiram has thrown up his hands in disgust and given up copy editing me as a hopeless task, don’t think you can just rush in to take his place!

  11. Walt

    Dude –
    I know you are pissing in your pampers right now over this, and I don’t want this to ruin your European vacation. Just curious though. What, exactly are you taking a vacation from? You do less than me, for Pete’s Sake. And I don’t do anything!!
    Anway, like Old Uncle Walt keeps telling you, look on the bright side. For example – to quote you :
    “But I certainly don’t intend to stop blogging or selling real estate..”
    Dude – no one but me, you and Fake Walt/Hiram read this thing. And I won’t miss you. And who cares about the copy boy? So no need to sweat that.
    And you have not sold anything for about 2 years, so you already stopped selling real estate!! Feel better? I hope so.
    Anyway, if that doesn’t work, do what I do. Ignore it all, and play dumb. I know you can do that.
    Hope this helps, and enjoy the trip.
    Your Pal,
    Walt

  12. Anonymous

    while in Italia…..Check in with Bellisconi on free speech issues…he will lead you to the promised land …..for sure…….

    have a great trip…Cao!

  13. duff

    Hey, have a great trip. Too bad you had this shi! dumped on you just before you leave, albeit to Italy and not the true land of saints and scholars. But, I bet you return with a renewed vigor and determination.

    Bon voyage!

  14. Helsa Poppin

    Since your membership is compulsory (unless you want to leave your job, which isn’t much of a choice), I would think regulating your speech does call First Amendment rights into question. Where does the requirement that you belong to the NAR come from? State law? Has Connecticut enshrined freedom of speech in its constitution?

    Agreed via the antitrust issues too. It’s one thing if you comment, say, on the personal hygiene of your fellow realtors – though I would defend your right to do so, as a participant in this market I don’t get anything out of that except some amusement. But your blog specifically addresses questions of value, which is of vital importance to anyone buying, selling, or even just maintaining a house here. It provides information about differences in Greenwich neighborhoods and microneighborhoods that even someone who has lived here for years may not know. And it shines a light on the murky subject of the realtor-client relationship, which puts your readers in a better position to deal with their agents from a position of being informed. These are valuable insights, and since they interfere with the existing hegemony it’s not surprising that they’re trying to shut you down. But doing so has a direct, adverse impact on the public, or at least the 20-odd people who post here on a regular basis.

    Now here’s the real question: what if the NAR decides not to clamp down on you, but your fellow realtors start to shun you and your clients? Then it’s up to us, potential buyers and sellers, to make it clear to our agents that we support your blog and consider it a necessary corrective to the hype in the Greenwich Time and coming out of the government at all levels.

    • christopherfountain

      Hellsa, there was builder, owner of two unsold and grossly over-priced homes (cause and effect? Nah…) who was running around town urging other spec builders to boycott me and my clients. When I called his agent to show one of his properties however, assuring her (truthfully) that my client was willing and capable of spending $7-$8 million, guess who was only too ready to let us in? I suppose that, if the good times ever return, a boycott could work (other than matters like restraint of trade and violation of MLS rules that permit all agents to show all properties) but right now when builders are trying to keep the lenders from foreclosing, it’s an empty threat. Screw ‘em, says I.

  15. I nearly got dragged in front of an ethics panel for blowing up the ridiculous “all clear, jump in, the water’s fine” (this was the week after Bear collapsed) comments on a scuzball competing broker’s blog.

    The thing was headed to hearing when I caught the competing broker redhanded doing something that was truly unethical.

    So I blackmailed him into dropping the charges.

    Good luck to you. Please let us know how it plays out. And don’t drop it if you lose. NAR and their corrupt local boards need to be both exposed and de-fanged in public.

  16. Back Country Girl

    (in tribute to a lady I truly miss posting on this blog…I’m only 2 years living in our lovely town, but I do love it here in Back Country)

    Chris-
    As a realtor (not a member here in Greenwich, but married into a family that is), as well as married to an attorney…very frankly you have done nothing incorrect. In fact, you present one of the ONLY voices of reason in this crazy place. I do not even look at a house without logging on to see what you have written about it. The loss of your voice would truly be a catastrophic event in the Greenwich real estate world. At least for buyers…but we are all to be kept in the dark about all issues, right? Just hand over the money!

    Have a wonderful vacation, enjoy the weather, and try not to even think about us here waiting for you to return!

  17. Truth Teller

    Today, the law recognizes only four exceptions to the First Amendment’s protection for free speech: (1) speech posing the “clear and present danger” of imminent violence or lawless action posited by Holmes, (2) disclosures threatening “national security,” (3) “obscenity” and (4) so-called “fighting words” that would provoke a reasonable person to an imminent, violent response.

    The Supreme Court’s affirming of a conviction for disturbing the peace based upon “fighting words” directed to a police officer has never been replicated since the original 1942 fighting words doctrine was announced in Chaplinsky v. New Hampshire.

    In that infamous speech case, Walter Chaplinsky, a Jehovah’s Witness, proselytizing on the street in Rochester, N.H., denounced organized religion as a “racket.” When Chaplinsky would not moderate his verbal attack, and when the crowd got angry and restive, a police officer took Chaplinsky toward the police station (but did not yet arrest him). During this trip, Chaplinsky accused the city marshal of being “a goddamned racketeer” and “a damned Fascist,” and went on to charge that “the whole government of Rochester are Fascists or agents of Fascists.”

    For this, Chaplinsky was arrested and charged under a statute prohibiting anyone from addressing “any offensive, derisive or annoying word to any other person who is lawfully in any street or other public place, nor call[ing] him by any offensive or derisive name.”

    The then President of the Watchtower Society, Judge Rutherford, and the Society’s Legal Counsel, testified before the Supreme Court that Chaplinsky spoke the truth, and was therefore, as a truth teller, entitled to First Amendment Protection.

    The Court rejected this argument. Conclusion: Telling Truth to racetteers and Fascists (and the whole muncipial government) gets you time in jail.

    During the Vietnam Era, the State of New Hapshire jailed one of Jehovah’s Witnesses for applying masking tape over the words on the car license plate of that State, “Live Free or Die.” So you see my point.

  18. HG

    I don’t see how a boycott could work even in a boom. Personally, given your well-advertised view on home prices, I would rather employ you on the sell side on the theory that buyers would view my Fountain-blessed listing price as a verified bargain.

  19. Cos Cobber

    The bottomline, any attempts to curtail your objective pricing opinion is tantamount to a racket. I cant think of any other industry or product where independent agents would be prohibited from sharing an opinion on asset valuations.

  20. Anon

    To Truth Teller et. al.

    The Constitution (and the individual protections accorded to people under it when the Bill of Rights was incorporated as the first 10 Amendments) only protects infringements do to “state action” – not infringements from private entities. So you need to show that the NAR is a quasi-govermental agency (maybe if required to join in order to sell real estate here, that would be enough) that is infringing on your 1st Amendment rights.

    Otherwise, you’re looking at a civil rights lawsuit, not a constitutional challenge.

    Most people realize this in an informal way – like the fact that the school prayer debate only centers around public schools, not Sacred Heart for instance.

  21. Anthony Fountain

    Seems to me the common law doctrine of restraint of trade would also pertain to whatever restrictions the NAR imposes on you.

  22. Laws today can run to hundreds or even thousands of pages. But the Sherman Anti-Trust Act of 1890 was breath-taking in its brevity: (Text in Full)

    Section 1:
    “Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.”

    Section 2:
    “Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony .”

    The Clayton Anti-Trust Act of 1914 extended its scope to these activities:

    price discrimination between different purchasers, if such discrimination tends to create a monopoly
    exclusive dealing agreements

    tying arrangements

    mergers and acquisitions that substantially reduce market competition.

    Comment: Oddly enough, buyers of good and services seem free to form clubs, associations or other cartels to pool their consumer power without interference from such laws.

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  24. george

    BTW, having a license to do anything does not protect you from anything. At best, a license (to cut hair, drive a car, practice law, sell real estate) gives a presumption of competency and a mechanism for possible discipline.