- Why did the brokers leave MLSNI and go to MAP?
- History of MLSNI since the Forensic Audit
- 5 Associations who want to stop One MLS send a letter through their attorney
- Anti One MLS group puts up a web page but won't reveal their names
- Glen Roberts writes two articles about the anti group, one for Inman and the other for Chicago Agent Magazine
- Steve Murray who was the facilitator for the Task Force for One MLS writes an article in response to the Anti letter
- Rebuttal letter sent to everyone from CAR and NSBAR
- Baird & Warner's Summary Document on Proposed MAP/MLSNI Merger Status.
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Why did the broker's leave MLSNI and go to MAP?
http://realtytimes.com/rtapages/20040322_mlsni.htm
http://realtytimes.com/rtapages/20040426_mlscontroversy.htm
http://realtytimes.com/rtapages/20040503_mlsnipullout.httm
______________________________
History of MLSNI since Forensic Audit:
7-29-04
August 3 PriceWaterhouseCoopers will deliver their forensic audit to MLSNI Shareholders (the President's of each of the 10 Boards/Associations
8-4-04
Yesterday PriceWaterhouseCoopers presented the forensic audit of MLSNI to representatives of the local REALTOR® associations. The report was lengthy and at the moment we are still reviewing the contents. Monday, August 9 the same group will meet to discuss possible actions. Once there have been decisions we will let you know
8-13-04
The Shareholders of MLSNI reviewed the forensic audit prepared by PriceWaterhouseCoopers and made a series of suggested actions to the MLSNI Board of Directors. Mary Unberger's Chicago Tribune articles August 10 and 11 and Blanche Evans' Realty Times articles that same week cover many of the areas of concern. MLSNI Board of Directors will meet August 25 and should address the issues. Issues include MLSNI's auditors, accountants, attorneys, CEO, Multiple Solutions owned by MLSNI and REBIG who was heavily funded by MLSNI through Multiple Solutions.
8-25-04
NSBAR's goal in asking for a forensic audit of MLSNI was to make sure that MLSNI conducted their business practices in the best interest of the Shareholders (whose interest is that of their members) while maintaining a high level of fiscal responsibility in those practices. We beleived that audit would ensure an environment of awareness and cooperation in making sure that MLSNI moves forward in delivering products and serices required of a MLS. With a 36 page report by a reputable company of PriceWaterhouseCoopers there were concrete areas to question. But, to our dismay armed with facts there were not enough votes to make any changes. We have done our job - we have done everything we can do. The issues turned political instead of staying legal. MLSNI will not make any changes. Their mission, philisophy, their additional corporations will continue as before
10-13-04
Jay Huffman is no longer with MLSNI
11-12-04
MLSNI will have a strategic planning session December 7 and 8. After that we should know the direction MLSNI plans to go.
12-07-04
Multiple Listing Service of Northern IL. (MLSNI) MLSNI Shareholder directions to MLSNI Board of Directors
On December 7th, 2004 representatives of the MLSNI shareholders meet in a joint session with the MLSNI Board of Directors( BOD ) to provide direction to the MLSNI BOD on the conduct of the business of MLSNI. The intent of the meeting was to hear concerns, discuss issues and to provide clear direction on the scope of services to be offered and to provide guidelines on how business was to be conducted in the future and the authority levels of the MLSNI staff.
The group thus assembled provided the following simple directives:
Prohibitions:
No secret meetings
No executive committee
No other businesses than core MLS
No other corporations (other than MLSNI)
No confidential agreements
No selling of data
Staff cannot execute contracts
Directives:
Investigate consolidation of area MLS services
Provide a single browser based MLS system
Deliver only core MLS services
Data and photos belong to the listing office
All contracts to be signed by President in presence of BOD
Run as a "not for profit corporation"
Disclose all current contracts--amounts--term--etc
Better manage MLSNI's current office space
Secure new legal counsel
Institute search for Manager Replacement
The overall directive was to have MLSNI return to the provision of only core MLS services and to govern itself in an open manner. Further, MLSNI was to pursue the goal of having only one MLS service in the market area.
12-08-04
MLSNI Director and Staff Planning Meeting
On 8 December 2004 the Directors and Staff of MLSNI met to address the directives from Shareholders offered during a meeting the previous day. In light of the directives from the previous day, the Directors undertook the tasks of re-defining MLSNI to be in compliance with the shareholder's directions. Each major directive/action is outlined below.
Redefine mission statement:
MLSNI is a Multiple Listing Service that provides services to participating brokers through shareholder associations. We create value for our customers by providing state of the art core MLS services
Pursue one MLS in the market:
Establish contact with other area MLS's leadership and indicate a desire to commence talks on possible consolidation. Appoint/establish discussion task force when appropriate. Seek appropriate legal counsel on the conduct of any such meetings
Identify core MLS services:
Listing data
Sold data
Mapping
Public records
Connectivity to other desired data (school match etc)
Effect data feeds to broker/agent productivity tools
Provide single browser based MLS system:
Identify current technology and service environment
Compile list of current contracts
Identify needs/desires of users and system managers
Conduct competitive procurement
Implement desired system
Undertake securing extension of current COMPASS contract
System Access Security:
Provide report on available system access security procedures/features and recommend action.
Current Office Space:
Optimize use of and possible sublease of current office space and move to more appropriate space when the opportunity arises.
Obtain/secure new legal counsel:
Institute search for new executive management:
This meeting was not an official Board of Directors function. Each of these tasks/action items might necessitate a formal BOD action and will therefore be taken up at future official functions.
1-17-05
Below is the final list of representatives from MLSNI for the joint consolidation committee. Loretta Alonzo added Piero Orsi Re/Max Showcase from RANWC in lieu of Fran Broude. MAP will have Bud Fogel, Chris Eigel, Andy Starck, Doug Ayers and perhaps one other representing them. Steve Murray will be the facilitator.
MLSNI Representatives:
Loretta Alonzo MLSNI/West Towns
Brad Tertell MLSNI
Jim Roth Realtor Prudential Preferred
Joel Adams Realtor Re/Max Suburban
Iver Johnson Realtor McHenry Association
Pat Callan Realtor RWSSC
Piero Orsi Realtor RANWC
Pam Krieter RWSSC AE
Peter Swaufield Fox Valley Association AE
Vernon Jones CAR AE
2-15-05
The MLS merger committee met and is making the following recommendation to all parties: A new entity be created that is NOT owned by the associations, all members will be REALTORS®, there will be IDX but not VOW, the associations will invoice the members, broker owned. NSBAR will vote on this proposal 2-23-05 and send the results to both MLS's.
February 10, 2005
To: Members of Consolidation Task Force
From: Steve Murray, Facilitator
RE: Outline of findings of Task Force Meetings January 21- February 10
Ladies and Gentlemen:
Thus far we have discussed the following:
What are the objectives of MLS
Who is the primary customer/client of MLS
What are the differences in the organization and founding principals of MAP and MLSNI
Reviewed organizational structures, voting procedures and other issues pertaining to how governance works for both MLS firms
Policy issues relating to membership, VOW’s, IDX, and other data distribution issues
Discussed and reviewed issues related to outcomes of various ideas for combining MLSNI and MAP
Discussed potential legal and financial implications of various ideas for combination of MLSNI and MAP
Reviewed and discussed information regarding ownership as it relates to association with NAR; as it relates to Realtor only membership policies; as it relates to voting and other issues.
General discussion of the operational, legal, membership, ownership and voting challenges of creating a combined MLS entity.
The following are a summation of the Consolidation Task Force’s recommendations to the respective leadership of MAP and MLSNI as it relates to creating one MLS for the brokerage firms and sales professionals of the Chicago marketplace. These are the outgrowth of the discussion briefly outlined above.
In each case a consensus was reached without unanimity by all those who participated.
General outline for NEWCO (a business to be formed by the combination of MAP and MLSNI)
A New Company to be formed
It was felt that forming a new company (NEWCO) that would acquire the assets of and assume certain liabilities of MLSNI and MAP would be the easiest and most acceptable manner in which to form NEWCO. While this could also be accomplished by an acquisition of one MLS firm by the other, it was felt that a fresh start, one where no entity bought the other, and with new ownership, would be best for all parties.
Broker owned business
It was felt that since there was general agreement that brokerage firms are the primary customer/client of MLS then they should own and govern the MLS. To have the broadest potential ownership participation yet not force any firm to have to be an owner in order to receive full MLS privileges, brokers could chose to be MEMBERS or SUBSCRIBERS (these terms used by example only).
MEMBERS would be firms that paid a joining fee and were able to receive voting rights and distributions of excess fees (if there were any).
SUBSCRIBERS would be firms that chose not to have to pay a joining fee, would not receive voting rights and would not receive distributions of excess fees.
MEMBERSHIP privileges would be delivered through a MEMBERSHIP AGREEMENT rather that through any stock subscription agreement.
Governance
The MEMBERS would elect 11-15 directors via proportional voting based on the size of each member. However each member would have a capped limit to their voting rights.
MEMBERS would be divided into several size categories and the bylaws would reflect that certain numbers of MEMBERS from each size category would be elected to fill directorships. This would ensure that all different sizes of MEMBERS and SUBSCIRBERS would have representation on the board of directors.
It was left open whether a SUBSCRIBER could be elected a director.
The Associations would have the right to appoint one director as well.
Rules
If this direction is taken it appears that we would not be able to have a formal association with the National Association of Realtors (NAR) for MLS purposes. This would mean:
We would need to seek our own Errors and Omissions Policy;
We would need to adopt our own Code of Ethics and other rules;
We would need to adopt our own policies about VOW’s, IDX and other critical issues of MLS governance.
Certainly there are other issues to be investigated in this area of NEWCO development.
Realtor membership
There was a general consensus that at the start NEWCO would insist that all MLS MEMBERS and SUBSCRIBERS would need to members of the Realtor Association. There was additional discussion and thought concerning legal challenges to this but it was felt that NEWCO directors would deal with this issue should it arise in later years.
VOW/IDX
While there remains some confusion over the differences in policy between the two existing MLS organizations it was felt that:
A modified OPT OUT IDX and/or VOW solution might work;
A modified use policy concerning broker supervision of Sales Professional Web sites and the ability to feed to Sales Professional Web sites under the supervision of Brokerage firms might also work to satisfy the needs of MEMBERS and SUBSCRIBERS of NEWCO.
Other issues
To form NEWCO would require a significant majority of the directors of MLSNI and MAP. We have tried to take into account the most pressing concerns of both organizations not assuming that either would take this decision lightly.
NEWCO would have to raise capital to acquire existing fixed assets and assume liabilities (such as MLS software licenses, office leases etc.). How much is yet to be determined
The existing MLS firms would liquidate and distribute remaining cash and other assets to their owners as per their own shareholder agreements.
At this stage we believe we need specific input and instructions from the directors of both organizations as to whether this direction is one that is workable. We understand that by seeking such direction we are not receiving a final commitment but rather a check on our progress thus far.
A more detailed plan can and would be created based on the input from the leadership of MAP and MLSNI.
The Consolidation Task Force
3-7-05
MLSNI Board of Directors continue to be unresponsive to the request of the Shareholders and continue to ignore their demands
3-11-05
Click here for a copy of the "Report to the Boards of Directors of MAP Multiple Listing Service and Multiple Listing Service of Northern Illinois".
3-22-05
NSBAR, West Towns, RWSSC and MAP has voted to support the concept of the one MLS. Everyone else has until April 11 to make up their minds.
4-13-05
All 10 MLSNI Shareholders, MLSNI BOD and MAP have all agred to continue meetings to develop a new MLS entity. See 2-15-05 for details of the agreement.
4-22-05
the next MLS consolodation meeting will be May 19. The group as agrred to hire Robert Downs, Professor of Law, University of Missouri (counsel to the Realty Alliance and RELO). They also agreed to hire the accounting firm of McGladrey & Pullen. McGladrey & Pullen is currently the accounting firm for MAP. They assisted MLSNI as consultants when we did the restructuring study back in 1995. All parties will sign non disclosure agreements.
5-23-05
update on consolodation From MLSNI: The consolidation task force met yesterday with our consultants,
Steve Murray, Bob Downs (attorney), Zach Fortsch & Milton Marcotte from McGladry Pullen.
We have made a lot of progress and after our next meeting on June 21 to review the detailed structural outline and business plan, the task force will be coming out with a draft of the key operational documents. The goal right now is to shoot for having NEWCO operational by the end of September.
The idea is that both MAP and MLSNI will run in tandem and deliver their current level of service on their current operating systems for possibly
up to another year until NEWCO makes final decisions for long term operations. Once NEWCO is operational and the necessary final and binding agreements signed, current members of MAP and MLSNI will be able to access the consolidated database on the operating system they are accustomed to using, thereby creating a seamless and transparent transition without any disruption to the business of individual agents.
Keep in mind that these are just a few of the things the task force has discussed, with many of the final details to be hammered out at
subsequent meetings.
With all that said, the recommendation from our consultants is that we need to establish an interim Board of Directors for Newco, the members
of which would serve from the time of incorporation until an election of directors by the shareholders can be accomplished, which should be in the fall if everything progresses as planned. This interim board would serve only so long as necessary to effect an orderly transition. Our consultants felt that the task force would be the ideal group to act as the interim Board of Directors given their involvement to date and their total familiarity with the transition plan. By no means is the group trying to commit to NEWCO without Shareholder approval. However, these are necessary steps that need to be taken in order for us to get to the next level. If any of you object to that concept, please let us know as soon as possible.
08-04-05
Today the Task force to make a recommendation to merge the 2 MLS's handed out the letter of intent for the new proposed MLS. The 10 Shareholder Board of Directors, the MLSNI Board and Directors and the MAP Board of Directors now have to review the letter of intent and sign it. If there is enough to sign it then the Task Force will put together the new articles of agreement and bylaws for the final and official vote.
08-23-05
NSBAR Directors signed the letter of intent regarding the combining of MLSNI and MAP.
Aurora (Shareholder vote 1.13) - voted to NOT sign the letter intent
CAR (Shareholder vote 31.34) - will vote on this August 30/31
Fox Valley (Shareholder vote 4.25) - signed
McHenry (Shareholder vote 2.57) - signed
NSBAR (Shareholder vote 6.97) - signed
RANWC (Shareholder vote 17.36) - signed
Oak Park (Shareholder vote 1.45) - voted to NOT sign the letter of intent
RWSSC (Shareholder vote 30.09) - signed
West Town (Shareholder vote 1.04) - still polling their members
3 Rivers (Shareholder vote 3.80) - signed
10-24-05
NSBAR ask for a motion to have a combined database before the end of 2005. We were told the earliest that could happen is in 4 or 5 months.
11-17-05
MLSNI is hoping for a merged MLS around the end of March of 2006
11-23-05
Recommendations from the MLSNI Rules Committee discussed at yesterday's Board of Directors meeting
(a) The bedroom counting and level relationships have been approved but are not yet implemented. This will not take place until early next year, once MLSNI has had the opportunity to have dynaConnections program the logic, inform the MLSNI Subscribers regarding the change, convert the current database, etc. So, for this, I would only circulate it as a "future change - for your information" piece at this time
02/16/06 MLSNI passed a motion to have a Shareholders meeting May 10, 2006 to take a final vote on the documents to merge MLSNI and MAP.
5-10-06
MLSNI did NOT have shareholders meeting this week to vote on the combined database. A motion was passed at the Wednesday MLSNI Directors meeting to support the concept of the 17 member board of "NewCO" and the 3 representatives to be AE's only. The vote had 3 no votes from McHenry, Oak Park and Aurora.
Also at the meeting each of the ten associations were to say how they felt about the combined database proposal for NEWCO. Those who want MLSNI to remain the same and not to proceed: Oak Park, Fox Valley, Aurora. Neutral and want permission from the Federal Government before proceeding: 3 Rivers, McHenry, West Town. Those who said to proceed: NSBAR, RWSSC, CAR, RANWC which is 87% of the total membership.
An outside attorney will be drawing up the papers for a vote of the MLSNI Directors and Shareholders.
5-24-06
Each association at the last MLSNI meeting was directed to state their position on the merged database:
RWSSC - Attorney changes are ok (add a seat for a small association and small broker). Association seats to AE only. LLC ok, Proceed
3 Rivers - stay neutral because pf DO J - wants that resolved first
Oak Park - Oppose, supports Aurora's paper (resolution attached)
NSBAR - Oppose Aurora's position that everything should stay the same for MLSNI and there is no merit to their position. Consolidation of database is supported. Did not like attorney's suggestion but would go with it IF it brings more to the position of one database. Association seat to AE only.
CAR - oppose Aurora's position. For consolidation. Tired of barriers. Would go along with attorney proposal ONLY as appeasement. Prefer task force proposal.
McHenry - staying neutral because of DOJ. prefer attorney proposal
RANWC - approve attorney proposal, want it in writing, go forward
Fox - Oppose to consolidation. Support Aurora resolution
Aurora - support their resolution
West Towns -Proceed with caution but must have DOJ advisory opinion by DOJ before proceeding
To me this equates to:
Do this now: RWSSC, NSBAR, CAR, RANWC which is 87% of the membership
Support Aurora resolution: Oak park, Fox, Aurora
Want permission from DOJ to proceed: 3 Rivers, McHenry, West Towns
There was a motion later in the meeting to adopt the attorney recommendation - 17 members and the ae's are in the 3 seats. Motion was carried with 3 voting no - McHenry representative, Oak Park representative, Aurora representative.
6-22-06
Yesterday MLSNI Board of Directors passed a series of motions to move forward the issue of combining databases for MLSNI and MAP. The due deligence papers are to be presented to the MLSNI Board of Directors July 24 and then send to the Shareholders for a vote on August 24, 2006. The challenge is to secure a quorum for the Shareholders meeting. It will take 6 Associations to be present to take the vote. Only 4 have publically stated they are for the merged database. Those four currently have 86.54% of the total vote but 4 won't constitute a quorum. Below is the May tally of positions. The issue of a DOJ advisory opinion was voted down by recommendation of attorneys. Stay tuned for August 24!
3 Rivers - stay neutral because pf DO J - wants that resolved first
Oak Park - Oppose, supports Aurora's paper (resolution attached)
NSBAR - Oppose Aurora's position that everything should stay the same for MLSNI and there is no merit to their position. Consolidation of database is supported. Did not like attorney's suggestion but would go with it IF it brings more to the position of one database. Association seat to AE only.
CAR - oppose Aurora's position. For consolidation. Tired of barriers. Would go along with attorney proposal ONLY as appeasement. Prefer task force proposal.
McHenry - staying neutral because of DOJ. prefer attorney proposal
RANWC - approve attorney proposal, want it in writing, go forward
Fox - Oppose to consolidation. Support Aurora resolution
Aurora - support their resolution
West Towns -Proceed with caution but must have DOJ advisory opinion by DOJ before proceeding
7-24-06
MLSNI Directors cancelled the Shareholders meeting for August 24 to vote for one MLS. The Directors have instructed the MLSNI Executive Committee to meeting with MAP and discuss their differences. So far it still looks like we do not have enough associations to consititute a quorum at a Shareholder's meeting even though those associations that want one MLS represent 90% of the listings. Those who combined have only 10% of the listings continue you to successfully stop the process.
8-4-06
MLSNI and MAP - one data base should be decided by October 2006
8-21-06
Mlsni directors should receive all the paperwork (due deligence) and information to make a final decision on merging the 2 MLS databases.
The vote will take place September 13, 2006. It may still take a Shareholders vote. Although the Shareholders meeting has not been established the annual mandatory meeting is every October
9-13-06
MLSNI Directors met to review the due diligence papers to vote on One MLS. Negotiations were presented and maybe now not all 6 associations previously against One MLS MIGHT view the proposal differently. There will be another meeting of MLSI Directors to see more paperwork on October 18 and then a Shareholders meeting to FINALLY vote on One MLS will be November 15th. If the vote is for ONE MLS it is hoped that things would move fast. If the associations against One MLS do not attend the Shareholders meeting then there would not be a quorum and no vote can be taken. Currently 4 associations have public ally stated they want One MLS and they hold 87% of all the members and 90% of all the listings. However, it takes 6 associations for a quorum. 5 of the six associations said they would not attend a shareholders meeting which would stop the vote.
9-14-06
Today it is discovered that someone who is hiding their identity has put together a web page rife with lies, misstatements and innuendos about One MLS. These perpetrators that won't even put their name on the documents are also sending out blind emails asking you to read it. Believe them if you want -- but if it is true, don't you think they would put their names on the document?
http://www.saveourmls.info/INDEX.HTML Email a response to this group about their distortion of the truth and tell them they should have the courage to say who they are instead of hiding behind a website.
Why are they against One MLS? They think MLS is run just fine, many of these people are the same people who empowered Jay Huffman. They think the associations should run MLS so they can change you more money so they can stay in business. They want to pool the recourses of the larger companies, sell their information and split the proceeds with everyone.
10-19-06
One step closer to One MLS! MLSNI Directors voted to send the issue of ONE MLS to the Shareholders for a vote November 15, 2006 and today MAP made the same recommendation to their shareholders. Stay tuned!
11-15-06
The shareholders approved the MAP transaction.
11-27-06
Dissenters filed suit to halt merger of One MLS. McHenry, West Towns, Aurora, Oak Park and Fox Valley filed a lawsuit to stop One MLS.
11-30-06
CHICAGO, IL -- (November 30, 2006) – The Multiple Listing Service of Northern Illinois, Inc. (MLSNI) and eight of the ten REALTOR® Associations who own MLSNI (including the Chicago Association of REALTORS®) have agreed to hold a preliminary injunction hearing on January 18 and 19, 2007, on a legal challenge to the consolidation of MLSNI and MAP.
"C.A.R. has been and continues to be a forceful advocate for the consolidation with MAP and the creation of “One MLS" for Chicagoland," said Alex Chaparro, president of C.A.R. The approval by MAP's membership and having a timetable for the resolution of the litigation are positive steps in guaranteeing the region's REALTORS® will continue to have access to a database with 100% of Chicagoland’s real estate listings."
The Aurora Tri-County Association of REALTORS® and other smaller REALTOR® associations who object to the Consolidation boycotted the November 15 at meeting and then filed a lawsuit in the Circuit Court of Cook County in an attempt to overturn the shareholder's approval of the Consolidation.
Virginia "Ginger" Downs, C.A.R.'s Chief Executive Officer, said "We are pleased that C.A.R. will have its day in court and an opportunity to defeat the unwarranted challenge to the MAP Consolidation. Each shareholder, director, officer, and agent of MLSNI who attended the various director and shareholder meetings held at MLSNI on November 15 acted in good faith in conducting the business."
The consolidation, including a transfer of the operating assets of both MLSNI and MAP to a new limited liability company was approved at a meeting of MLSNI's shareholders on November 15. MAP's membership approved the consolidation yesterday, subject to the resolution of the pending litigation.
The Plaintiffs were seeking a Temporary Restraining Order. Instead, attorneys for MLSNI, C.A.R., the REALTOR® Association of West/South Suburban Chicagoland, and the North Shore - Barrington Association of REALTORS® agreed on a date for the preliminary injunction hearing, and also that MLSNI would not close on a transfer of substantially all of its assets prior to that date.
The Court did not enter a Temporary Restraining Order, and the Order entered does not include any findings, any admissions, or a decision on the merits of the case -- preliminary or otherwise.
1-18-07
Court date for One MLS decision will not be until 1-23-07. Watch this site on 1-24-07 for results!
1-23-07
The Court hearing for One MLS began Friday and resumed today, Tuesday. Our attorneys say there will NOT be a decision today. We will keep you posted.
1-23-07
The court has scheduled 3 more days of hearings on one mls.
1-24-07
Court has ganted 3 more days of hearing for the objectors on the One MLS lawsuit Feb 15, 16 and 24th.
2-16-07
In the court case for One MLS the judge will hear auguments for motions on March 9th
3-9-07
One MLS: The court heard motions today but did not grant a Temporary Restraining Order. Next court date is 4-9-07
4-19-07
One MLS Database. MLSNI Board of Directors passed a motion yesterday to have a common database for MAP and MLSNI to begin June 1, 2007. We will keep you up to date on the details as they happen. The concept would be MAP listing in MLSNI and MLSNI listings in MAP.
04-26-07
Judge will rule on the One MLS case May 9, 2007
05-09-07
Judge Martin Agran today orally entered an order that will allow the shareholders of MLSNI to consider at a reconstituted Annual Meeting of shareholders a transaction between MLSNI and MAP. We await a final copy of the transcript containing the details of the Judge's Order.
05-10-07
Judge Martin S. Agran ruled in favor of North Shore-Barrington on its Motion for Summary Judgment yesterday, when he announced his ruling on both Plaintiffs' Motion for Preliminary Injunction and North Shore-Barrington's Motion for Summary Judgment, which he deemed to be "joined at the hip."
Judge Agran first ruled that, pursuant to MLSNI's Articles of Incorporation and By-Laws, and notwithstanding the findings of the special election committee, a quorum was not present to transact business at the November 15th meeting. However, he determined that the Plaintiffs breached the Amended and Restated Voting Agreement by executing a blanket notice of revocation of their proxies in connection with that meeting. Judge Agran further ruled that MLSNI is a close corporation, its shareholders therefore owe fiduciary duties to MLSNI and each other, and that consistent with those fiduciary duties, MLSNI's quorum requirements do not give its minority shareholders a veto power to paralyze the management of MLSNI and frustrate the will of the majority of the shareholders and directors.
Judge Agran ordered the following:
1) The November 15th Annual Meeting is void for a lack of quorum;
2) Summary Judgment is granted in favor of North Shore-Barrington on its claims for breach of fiduciary duty and breach of contract;
3) That a reconstituted Annual Meeting be held within 30 days, to include the confirmation of Directors and a vote on the MAP transaction; and
4) That Plaintiffs are required to attend, and will be deemed to be present for the purposes of a quorum if they fail to attend.
05-18-07
The ruling made eariler this month is being appealed. More information on this will be made available by May 23rd.
05-24-07
They won't give up. The 5 associations have filed another appeal today.
05-31-07
MLSNI could not hold today's annual Shareholder's meeting previously ordered by the Circuit Court of Cook County, after the appellate court temporarily stayed the order. Earlier this month, the circuit court ruled that the 11-15-07 annual Shareholder's meeting is void for a lack of quorum, but ordered that a reconstituted Annual Meeting be held within 30 days, to include the confirmation of Directors and a vote on the MAP transaction, and required all shareholders to attend or be deemed present for the purposes of a quorum if they fail to attend. That meeting was noticed for today. The 5 Boards trying to stop One MLS asked the appellate court to stay the required meeting pending the outcome of their appeal of the circuit court's order; the appellate court granted the order until it could consider both sides of the issue. A new meeting has been called for Tuesday, June 26, and hopefully the court will lift the stay before then.
Also, there was no Director's meeting today because the new board has not yet been confirmed. MLSNI reported that the shared database can be tested while we are waiting for the appellate court's ruling.
_______________________
Anti One MLS puts up a web page but won't reveal who they are. http://www.saveourmls.info/
______________________________
Opponents of combined Chicago-area MLS say they may sue Group cautions MLSNI about moving ahead in proposed joining with MAP Friday, September 15, 2006 By Glenn Roberts Jr. Inman News . Roberts also wrote an article for Chicago Agent about the group fighting One MLS. (Volume3, Issue 18, 09.11.06
______________________________
You may link to Steve Murray’s RealTrends blog here: http://realtrendsblog.com/wp/?m=200609
______________________________
Rebuttal from NSBAR and CAR - written by their attorneys:
TRUTH AND LIES BEHIND “SAVE OUR MLS”
A website called “SAVE OUR MLS” has been established by persons who are not willing to identify themselves, although the sponsors are probably related to one of the five boards that hired the lawyer who wrote a accusatory letter full of its own misinformation to the MLSNI board. (In case you don’t know, those five boards are Realtor® Association of the Fox Valley, McHenry County Association of Realtors®, West Towns Board of Realtors® Aurora Tri-County Association of Realtors® and Oak Park Board of Realtors®.) Information on the web site is addressed to the brokerage community and criticizes the proposed combination of the businesses of MLSNI and MAP. While discussion is healthy and everyone is entitled to his own opinion, the web site is a fountain of misinformation that needs to be corrected.
· THE LIE: SAVE OUR MLS alleges that the forensic audit of MLSNI authorized by its board of directors in 2004 was a mere “cover” for three large brokerage firms to conduct radical changes in MLSNI operations and management.
THE TRUTH: The audit was performed to investigate serious matters that led ultimately to the departure of the CEO. In addition, the management structure and election changes that followed the 2004 audit were approved UNANIMOUSLY by the Board of Directors and UNANIMOUSLY by ALL TEN of the Shareholders.
· THE LIE: SAVE OUR MLS warns of new and uncertain rules of operation.
THE TRUTH: The operation is clearly set forth in documents that are being finalized for consideration by the board of directors and the shareholders.
· THE LIE: SAVE OUR MLS states that the combined business would have only a “limited broker vote,” that it will operate at “the whim of a select few,” and that “only 4% of the 6000 brokers in the metropolitan area would have a controlling interest in the governing board” of the combined business operation.
THE TRUTH: Thirteen of the fifteen board seats are intended to be individuals nominated by brokers. Brokers from all geographical areas, small firms, large firms, franchise and non-franchise firms, can buy a preferred unit which entitles them to one vote per firm. Since each broker firm has one vote, "big brokers" cannot dominate the Board, and there are no Board seats "reserved" for "big brokers." Any broker can run for a board seat or submit a nomination, but to encourage that there will be a balance, there is a nominating committee that is expressly tasked with the job of seeking diversity among geographical areas, small firms, large firms, franchise and non-franchise firms. This is true broker democracy, with a goal to have individuals serving whose concern is for the integrity of the real estate profession. This balanced group of directors, together with two directors representing MLSNI will be the decision makers in the business.
· THE LIE: While SAVE OUR MLS admits that discussions between MLSNI and MAP have gone on for over a year, it also alleges that the transaction is being “hurriedly pushed toward adoption” with “lack of discussion.”
THE TRUTH: In 2005, MLSNI created a task force with MAP to see if there would be interest in a business transaction with MAP. That task force included representatives from many of the Associations and the first written report of the task force was issued February 10, 2005. The task force process resulted in a Letter of Intent that was signed by eight of the ten MLSNI Association-shareholders. Those eight Associations were: Chicago Association of Realtors®, Realtor® Association of the Fox Valley, McHenry County Association of Realtors®, North Shore-Barrington Association of REALTORS®, REALTOR® Association of North West Chicagoland, Realtor® Association of the West South Suburban Chicagoland, West Towns Board of Realtors® and Three Rivers Association of Realtors®.
Each of the eight Association-shareholders stated in this Letter of Intent that it had "... no serious reservations about moving forward with the planning process ... necessary to create definitive contracts ... so that the plan to combine MAP and MLSNI may be accomplished in an expeditious manner." In addition, representatives and lawyers of the larger REALTOR® boards met with representatives and lawyers of the smaller REALTOR® boards for many months in an effort to reach a common ground over the needs of all.
· THE LIE: SAVE OUR MLS alleges that “some” have sought to change the successful MLSNI “for their own purposes.”
THE TRUTH: - Associations that hold approximately 88% of MLSNI's voting power and whose members constitute approximately 85% of the MLSNI subscribers and contribute approximately 85% of the listings to MLSNI want the transaction to proceed to a vote.
· THE LIE: SAVE OUR MLS states that the new organization would have a new subscriber fee structure.
THE TRUTH: The organization is mandated to run at break even, just as MLSNI currently is mandated to operate.
· THE LIE: SAVE OUR MLS states that the new organization would end the existing association with the National Association of REALTORS® and its Code of Ethics and other user safeguards.
THE TRUTH: The new MLS would not dissociate with NAR. The new entity will follow NAR Rules and Regulations just as MLSNI does.
· THE LIE: SAVE OUR MLS states that the transaction will “greatly restrict the ability of you and your firm to exist in the near future” and that most MLSNI members will not benefit from the consolidation of the two MLS systems.
THE TRUTH: Expanding the MLS through the consolidation with MAP may create economies of scale and a better technology platform, but the real threat is what will happen if brokerage firms representing a large subscriber base totally withdraw from MLSNI should the transaction with MAP not occur. Were significant withdrawals to occur, the viability of MLSNI and other broker access to listings would be threatened. The refusal of all of the boards to recognize this threat is a dangerous denial of reality. THAT is the threat to your future.
· THE LIE: There has been a lack of disclosure from MAP concerning its assets and liabilities to be assumed, a lack of disclosure by some MLSNI board members about potential conflicts of interest from their, or their company’s affiliation with MAP, and antitrust opinions have not been sought or, at the very least, been made available to MLSNI shareholders.”
THE TRUTH: MAP has made disclosure of its assets and liabilities. Each Director member of the MLSNI Board of Directors has completed a “Disclosure of Potential Conflict of Interest”, and the antitrust opinion has been sought, received, discussed and delivered to the Board of Directors and their attorneys.
AND HERE IS A QUESTION TO THE UNNAMED ASSOCIATIONS BEHIND SAVE OUR MLS: ARE YOU ACTING RESPONSIBLY AND RESPONSIVELY TO YOUR USERS AND PURCHASERS OF MLS SERVICES WITH RESPECT TO THE MARKUPS YOU CHARGE YOUR MEMBERS? THE ASSOCIATIONS IN FAVOR OF THE TRANSACTION ARE SERVING THEIR MEMBERS. ARE YOU?
by:
Chicago Association of REALTORS
North Shore - Barrington Association of REALTORS
REALTOR Association of West/South Suburban Chicagoland
Summary Document on Proposed MAP/MLSNI Merger Status
October 10, 2006
Overview:
Following is a current summary of the terms of the proposed new MLS structure. While some parts of the new organization are not completely to our liking, on balance, I feel this is a positive step for agents, Baird & Warner, and the real estate industry in Chicago. The new MLS system (Newco) accomplishes some of the major goals we identified when this began over two years ago: It will be:
1) an MLS system that is run by brokers for brokers;
2) one MLS system that covers the entire Chicagoland market with only one reasonable fee to agents; and,
3) an organization that is focused solely on delivering the best multiple listing service technology available to agents on a not-for-profit basis.
At the MLSNI board meeting on October 18, the board is expected to pass a resolution to recommend to its shareholders the approval of Newco. The MAP board of directors has already approved the merger. The resolution will then be sent to shareholders of MLSNI for their approval. The shareholders are scheduled to meet on November 15 to take up the matter. Currently, there are ten real estate boards who are shareholders of MLSNI. At that meeting, when the shareholders vote, they will vote based upon their relative size. The four largest boards who represent well over 80% of the voting strength have indicated that they strongly support Newco. Those boards are the Chicago Association of REALTORS®, the North Shore-Barrington Association, the REALTOR® Association of West/South Suburban Chicagoland and the REALTOR® Association of NorthWest Chicagoland.
Possible Opposition:
Five real estate boards representing approximately 13% of the membership have indicated that they oppose the transaction. While it is not entirely clear why they oppose Newco, they are reluctant to accept their loss of control and the change that Newco would bring. These boards include: the Oak Park Board of REALTORS®, the West Towns Board of REALTORS®, the Aurora Tri-County Association, the REALTOR® Association of the Fox Valley and the McHenry County Association of REALTORS®. Because these boards only represent 13% of the membership, if a shareholder meeting was held, Newco would pass. However, in order for a shareholder meeting to happen, they must have a quorum or six boards in attendance to hold the meeting. Therefore, if these five dissenting boards refuse to show up at the shareholder meeting, they could essentially torpedo the process by refusing to vote. We currently have members in two of those boards: Fox Valley and Oak Park. I urge our agents who are members of those boards to contact those boards and encourage them to vote in favor of Newco. If the proposal passes, it is hoped that there will be one system with one fee structure beginning January 1, 2007.
What happens if the resolution does not pass or a shareholder meeting is not held?
I believe that it will create a very disruptive situation. A tremendous amount of effort by a lot of people has gone into the forming of Newco. Well over 80% of the members support this resolution. If a small minority is able to hijack the process, my feeling is that several of the large boards will seek another alternative for MLS services.
What does this mean?
This means that a potential exists for one or more of the large real estate boards to withdraw from MLSNI and seek other alternatives to provide MLS services to their agents. Obviously, this would be a difficult and stressful process for all involved. I am hopeful that leveler heads will prevail and Newco will be formed in November.
Background:
We have been working on a solution to improve the MLS systems that currently exist in the Chicago market for over two years. I think it is a good idea to revisit the reasons why we embarked on this strategy:
- Among about one-quarter of the marketplace at that time was in two multiple listing systems.
- Most importantly, we were concerned about the security of our data. As other systems outside the MLS (REALTOR.com, Tribune.com, BairdWarner.com, among others) have become increasingly important to us for marketing purposes, it became critical that we maintain the integrity, quality, and timeliness of that data. MLSNI was a vital link in that process and could not guarantee us the technology, security or reliability that was necessary for us to move forward. This was the main reason that Baird & Warner, Coldwell Banker, Koenig & Strey, Stark, and several RE/MAX offices, among others, decided that for data integrity purposes, we needed to seek another solution.
- There was significant mismanagement within the MLSNI organization, which culminated in an audit that found significant irregularities leading to the firing of the former CEO of MLSNI.
- We felt it was important that brokers directly control the direction of MLSNI. As a general rule, broker-controlled multiple listing services are better run because they are closer to the issues that are important to the brokers and agents — the day-to-day real estate transactions.
General Comments:
We are not alone. This trend is happening occurring throughout the United States. There are more than 20 MLS systems currently in the process of converting from association-controlled to broker-controlled.
I have heard some comments on how Baird & Warner benefited financially from this situation. While it is true that our distribution from MAP has increased slightly, that has been more than overridden by the increased costs that we as a company have incurred. The increased administrative functions in just one office cost us more than we received in additional revenue from MAP. This has been a very expensive process for agents, companies and the MLS systems themselves; however, I feel strongly that this was a broken system that needed to be fixed.
While it has been very painful and expensive for many, many participants in the process, I am very hopeful that the solution will be well worth the effort and that several years from now we will all look back and realize that it was well worth our inconvenience and expense. The MLS is too important in the day-to-day practice of our business for us not to have the best, most efficient, most technologically advanced systems available. I am hopeful that we are on the road to finding that solution.
