Ontario court rules against downloading of Multiple Listing Service information, then offering it to the public

Janet McFarland and Steve Ladurantaye – Globe and Mail

An Ontario court has shut the door on attempts to create new web sites to repackage real estate listings using data from the Multiple Listings Service system.

In a ruling released Monday, Mr. Justice David Brown of the Ontario Superior Court said Toronto real estate broker Fraser Beach did not have the right to provide broad public access to MLS data through a web site he helped create while working for BCE Inc. (BCE-T28.330.050.18%) division Bell New Ventures in 2007.

The decision comes after the Toronto Real Estate Board (TREB) shut down several attempts in recent years to create new web sites populated with data taken from the MLS system – including an operation started by Mr. Beach.

In the United States, by comparison, a number of popular web sites have been created giving home buyers new ways to sort real estate listings data or providing extra information about a neighbourhood.

Comment: The issue was not sorting data, it was creating a site with data stolen from the MLS site. Sorting is fine stealing is not. That is why the judge ruled the way he did.

TREB chief executive officer Don Richardson said Monday his association is pleased with the court ruling “and feels the integrity of the MLS and the rights of sellers, consumers and brokers have been protected.”

In April, 2007, Mr. Beach used his access password as a real estate agent and member of TREB to download large blocks of listings from the TREB MLS website, using it to build a new web site called realestateplus.ca that would allow customers to search MLS data to find potential properties to purchase in Toronto.

Comment: And that is what was wrong. Downloading data from MLS and using it on his site without permission. Try stealing everything on the Toronto Star site and use it to create your own newspaper site. Bet they sue you. Try stealing music from iTunes and then use it to create your own music site. Watch them protect their data. Why is what TREB did any different? Why are people acting like it was wrong?

While the Canadian Real Estate Association (CREA), which owns MLS, provides the public with limited access to the data, Mr. Beach’s venture gave customers entry to the full MLS data that currently can only be accessed by real estate agents.

Comment: The little bit of information that is withheld in no way affects the quality of what the consumer sees. It has to do with sellers’ names, which people have no right to know. There is commission information, which buyers will find out when doing an offer. There is nothing “hidden” from consumers that they desperately need to know.

TREB cancelled Mr. Beach’s password shortly after the launch of his restestateplus.ca web site. He subsequently sued TREB, arguing he had the right to use the data, and TREB should not have shut him down.

In his decision, Judge Brown said the agreement in place between TREB and its members did not allow Mr. Beach to download large volumes of MLS data and give access to the information to unauthorized users.

He also said his ruling would not deal with the issue of whether the rules for using the MLS database breach or conform with Canadian competition laws – a long-standing debate in Canada that is currently the subject of a review by the federal Competition Bureau.

Comment: Again, it has nothing to do with competition. Start your own real estate site and compete all you want, no one is stopping you. But the data on MLS belongs to real estate agents who belong to the relevant organizations. If you want your home listed on it, then you work with a licensed real estate agent. If you want to post it on a FSBO site, then you are welcome to do so – and pay them for the privilege. There are any number of members-only sites on the internet, why is everyone picking on MLS?

But lawyer Lawrence Dale, who represented Mr. Beach, said while the case was unrelated to the long-running Competition Bureau review of access to the MLS system, the judge’s decision may nonetheless be relevant to that investigation because it establishes that TREB’s rules are restrictive.

Comment: The ruling says nothing about TREB being restrictive. The ruling specifically avoids the issue. Read it for yourself.

“Justice Brown’s decision has squarely placed the issue at the feet of the Competition Bureau,” he said. “In the United States, the government found that these identical rules were anti-competitive and the Department of Justice had them removed.”

CREA said last month it would like to resolve the competition issues – which centre around whether sellers wanting to post on the MLS need to be represented by a real estate agent or not – by this Friday. A deal doesn’t seem imminent, however, with both sides deferring comment. The Competition Bureau can force changes, but a spokesperson Greg Scott said it would rather come to a negotiated agreement with CREA.

“Our first preference is always a voluntary solution,” he said. “We don’t have that yet.”

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