Keller Williams Realty Franchise

Financing Details

Keller Williams Realty, LLC does not offer any direct or indirect financing to its franchisees. Additionally, it does not guarantee any of their notes, leases, or other financial obligations.

Litigation Summary

Keller Williams Realty, LLC is currently involved in several pending lawsuits. A significant portion involves class action antitrust lawsuits, including the Christopher Moehrl, Joshua Sitzer, and various "Moehrl copycat" cases (e.g., Gary Bauman, Shauntell Burton, QJ Team, Christina Grace, Julie Martin, Daniel Umpa, Willsim Latham, Dalton K. Jensen) filed by home sellers. These allege that Keller Williams and other real estate brokerage franchisors conspired to inflate buyer brokers' commissions. While Keller Williams has reached a $70 million nationwide settlement in the Sitzer case, which resolves many of these copycat claims, the settlement is under appeal. A separate buyer class action, Judah Leeder, also alleging antitrust violations, is ongoing, though its Sherman Act claim was dismissed, state claims continue. Additionally, Keller Williams faces multiple distinct lawsuits involving former executives and franchisees, such as John Davis (two separate litigations alleging fraud, breach of contract, RICO, and Sherman Act violations), Colleen L. Basinski (tortious interference), and Paul Morris (intentional tort, unfair competition). Many of these cases are currently compelled to arbitration and stayed. Other pending cases include Matthew Fetick (RICO, fraudulent misrepresentation), Vicki Coffey (Telephone Consumer Protection Act violations), and Renee Montalbano (respondeat superior). Keller Williams Realty states it will vigorously defend against these matters. Keller Williams Realty, LLC has concluded several litigations. In May 2024, Eric Delgado's claims were dismissed with prejudice following a settlement related to an ownership transfer. Inga Dow's claims against Keller Williams Realty and Gary Keller were dismissed with prejudice in September 2023 after a settlement. The company also resolved several class action lawsuits alleging Telephone Consumer Protection Act (TCPA) violations (e.g., Beverly DeShay, Danna St. John, Brian Hayhurst, Bruce Wright), agreeing to a $40 million settlement in the DeShay case that was given final approval in April 2023, with payments extending into 2025. Other individual TCPA cases (James Havassy, Wayne Garvey, Dr. Jeff Isaacs, Jerri L. Moulder P.C., Mauricio Cardero, Mark Ortega) were dismissed with prejudice after settlements. Additionally, Jerri L. Moulder P.C.'s class action concerning profit-sharing plan changes was dismissed after the changes were repealed and a settlement was reached. An arbitration with DRO L.A. LP regarding a regional representative agreement was also dismissed after a settlement in 2024. Keller Williams did not file any royalty collection or other suits against its market center franchisees during its previous fiscal year.

Renewal Conditions

To renew a Keller Williams Realty Market Center franchise, franchisees must meet several conditions. They must have fully complied with the terms of their expiring franchise agreement throughout its duration and provide written notice of their intent to apply for a new agreement between 210 and 365 days before the current term ends. The Market Center must have consistently made Profit Sharing Contributions in at least four out of every five consecutive months during the 24 months prior to the term's end, and must have been continuously managed by an approved Operating Principal and Team Leader. Franchisees are required to repair and update their equipment and premises to reflect current system standards, ensure they are not in default of any agreements with Keller Williams Realty or its affiliates, and maintain the right to occupy their approved location. They must pay a fee equal to 10% of the then-current initial franchise fee for new franchisees or $5,000, whichever is less. Additionally, franchisees must sign the then-current form of franchise agreement, which may contain different terms, at least 90 days before the current agreement expires, and also execute a general release of claims. All key personnel (Operating Principal, Team Leader, Market Center Administrator, and Franchisee's Principals) must meet current qualification and training requirements. The franchisee's group must demonstrate diligent efforts in developing the Market Center, and the Operating Principal and Franchisee's Principals must authorize background and credit checks. Finally, all Franchisee's Principals must meet Keller Williams Realty's current subjective and objective criteria for new franchisees, and the franchisee must provide five years of financial statements for the Market Center.

Staffing Notes

Keller Williams Realty Market Centers require a core leadership team consisting of an Operating Principal, a Team Leader, and a Market Center Administrator. The Operating Principal must be a licensed real estate broker (unless other services are secured), have significant authority over daily operations, and dedicate substantial effort to supervision and management. The Team Leader is primarily responsible for Associate recruitment, training, and consulting, dedicating substantial energy to management and development without engaging in real estate sales or other business activities. The Market Center Administrator assists the Team Leader with daily administrative and financial functions and also must not engage in real estate sales or other business activities. The same individual cannot serve as both Operating Principal and Team Leader for the same Market Center. These key personnel are required to attend initial and ongoing training. The franchisor states that additional office personnel are not initially required for the operation of a Market Center.