What’s in a name? NAR says, it better be the truth.

One of the most controversial Standards of Practice to come from NAR in long time, would have to be the new Standard of Practice 12-12, which became effective January 1, 2008.  Just to refresh your memory, Article 12 is known as the “truth in advertising” article.  We have come a long way from the published newspaper ad.  Years ago, that was pretty much all that was available to REALTORS to spread the word about their new listing.  Now, advertising can be instantaneous thanks to the internet.  In addition to company web-sites, many agents have their own personal website.  Some of the URLs and domain names used can be either dull or attention getters, and sometimes down right misleading.  The new Standard of Practice 12-12 states:  REALTORS shall not:  (1) use URLs or domain names that present less than a true picture, or (2) register URLs or domain names which, if used, would present less than a true picture. 

The new NAR Case Interpretation 12-20 address this new Standard of Practice.  So, here it is–you be the judge–REALTOR A, a residential broker in a major metropolitan city, spent several weeks each year in his cabin in the north woods where he planned to retire one day.  Even while at home in the city, REALTOR A stayed abreast of local news, events, and especially the local real estate market by subscribing to the print and on-line editions of the local newspaper.  He also bookmarked a number of north woods brokers’ websites to stay current with the market and to watch for potential investment opportunities.

One evening while surfing the internet, REALTOR A came across a URL he was unfamiliar with–northwoodsandlakesmls.com.  REALTOR A was pleased to see the MLS serving the area where he vacationed for so many years had created a website accessible to the public.  Clicking on the link, he was surprised to find that the website connected with REALTOR Z’s company website, not an MLS website.  Having had prior dealings with REALTOR Z, REALTOR A spent time carefully scrutinizing the site.  He noted, among other things, that the name of REALTOR Z’s firm did not include the letters MLS.  REALTOR A sent a letter to the association’s EO asking whether REALTOR Z had been authorized to use the name northwoodsandlakesmls.com and whether it presented a true picture as required by Article 12 of the Code of Ethics.  REALTOR Z filed a complaint alleging that when he clicked on what appeared to be a real estate-related URL that included the letteres “MLS” he expected to be connected with a website operated with a multile listing service.  He stated he felt that REALTOR Z’s URL was deceptive and did not meet the true picture test.

At the hearing, REALTOR Z defended his URL on a number of grounds including the fact that he was a participant in good standing in the MLS and he was authroized to display other participants’ listings  on his website under MLS rules.  “If I used `MLS’ in the name of my firm, I could see how that might be perceived as something less than a true picture,” he argued, “but by simply  using MLS in my URL I am telling consumers that they can get MLS-provided information about properties in the north woods from me.  What could be truer than that?”

How do you think the hearing panel ruled?  Do you think REALTOR Z  was found in violation of Article 12?  What do you think of the new Standard of Practice?   

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9 Responses to What’s in a name? NAR says, it better be the truth.

  1. Tony Arko says:

    Of course he was found in violation. But that doesn’t mean his site was misleading. It could just as easily mean that the rule was written by a committee made up of brokers who are owners of the MLS and are trying to protect their turf. What they don’t realize is that anyone else in the world except Realtors can go ahead and use MLS anywhere in their urls. In fact, MLS is owned by Major League Soccer, so if the agent was smart he could probably make reference to the nearest MLS team and be well within his rights to use the url. Then he wouldn’t be misleading at all. This entire interpretation of the rule is a complete joke and makes us look like idiots.

  2. I’ve written extensively on this topic and will not do so here again. Tony is correct and NAR is wrong (in my humble opinion). REALTORS® in Indianapolis did what NAR refused to do when they came up with a substitute name for the MLS that we could trademark – Broker Listing Cooperative (BLC). Trying to protect trademarks through the Code is just wrong and puts REALTORS at a disadvantage.

  3. Tony, Don’t buy RealtorsAreIdiots.com since that would be a trademark violation.

    Dave, NAR doesn’t own a trademark on MLS. Thank you for your other efforts.

    Rosanne,
    From your post, I couldn’t tell if you have an opinion on the matter, or if you just wanted to start a discussion.

    Let us keep in mind that the decision of a random non-legal panel with a grudge does not set nationwide precedence.

    1) NAR’s Realtor magazine actually recommended a few years back that we put MLS in our domain name. Ala: CityNameMLS.com

    2) Google “MLS.” Realtor.com shows up first.

    3) 30-50% of Realtor websites have “MLS” on it. That includes half of the Board of Directors.

    4) Even your site has a “MLS” link on it. That doesn’t go to the MLS, it goes to an IDX.

    I would love to hear your opinion on the matter, now that you have heard some of our opinions.

    Thanks for starting the discussion!

    Frank- Broker FranklyRealty.com, Virginia Real Estate

  4. Rosanne Bunting says:

    Thank you all for the response. Frank, I did want to begin this discussion; but, also, I wanted to make everyone aware of this new case study. The case study comes directly from NAR. Somewhere in the country,this case took place and NAR has chosen to include it in thier case studies. The outcome of this case is what caused the new Standard of Practice 12-12 to be written and adopted in January 2008.

    First, let me give you the NAR answer. “The hearing panel disagreed with REALTOR Z’s reasoning. While REALTOR Z’s website included information about other participants’ listings that the MLS had provided – and that REALTOR Z was authorized to display – the fact remained that a real estate-related URL that included the letters MLS would lead reasonable consumers to conclude that the website would be an MLS’s, and not a brokers website. REALTOR Z was found in violation of Article 12 as interpreted by Standard of Practice 12-10.”

    SOP 12-10, which was adopted in 2007, states: REALTORS obligation to present a true picture in their advertising and representations to the public includes the URLs and domain names they use, and prohibit REALTORS from: (1) engaging in deceptive or unauthorized framing of real estate brokerage websites; (2)manipulating (e.g. presenting content developed by others) listing content in any way that produces a deceptive or misleading result; or (3) deceptively using metatags, keywords, or other devices/methods to direct, drive, or divert Internet traffic, or to otherwise mislead consumers.

    The new Standard of Practice 12-12, refers to all URLs or domain names. So, let’s not think about the addition of mls to a name, but think about this. Supposing I registered rosanneinternationalrealestate.com as my domain name. It would certainly cause people to think I was an international broker. When they find out my primary real estate market is the Middle Peninsula of Virginia, one could certainly say my name was deceptive.

    Unfortunately, whether or not we agree with NAR, is not the issue. As long as this SOP exists, it is part of the Code. If a REALTOR is charged with an alleged violation of Article 12 as supported by SOP 12-12, they will certainly have to go through the complaint process. Unless this is revised, just be careful!

  5. Scott Rogers says:

    Rosanne — that is an interesting comparison (international) that I hadn’t considered.

    Hmmmm…..I am a Realtor with Coldwell Banker Funkhouser Realtors…..and sometimes people come into our office thinking we are a bank……I guess the Coldwell Banker brand could be in trouble if this SOP gets expanded. :)

  6. Rosanne says:

    Hi Scott,

    Very funny–Do you have a vault full of money in your office? If so, I may just come to Harrisonburg and work with you! In all seriousness, I hope this SOP will not be expanded. I think we have enough potential prolems now. Thanks for the comments.

  7. Jim Rake says:

    Frank’s & Tony’s points are well taken. No, it isn’t surprising that Realtor Z was found in violation, although I might have to disagree with “whether or not we agree with NAR, is not the issue”.
    If it bothers us, and I’m sure it does some, we’ll amend it to better meet the intent. Somehow, almost strikes me as a case of us focusing on the nit, instead of the elephant in the room. The use of “MLS” is “misleading”?

  8. Rosanne says:

    Thanks for the comments Jim. I still maintain that whether or not we agree with NAR is not the issue. As long as the SOP is as it is, we can get in hot water. So, as I said before, unless it is amended, be careful!

  9. Pingback: How Do You Spell MLS? | BloodhoundBlog: Real estate marketing and technology blog | Realtors and real estate, mortgages, lending, investments

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