Appeals Court Leaves NAR’s Three-Way Membership Structure Intact

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A federal appeals court has left in place the dismissal of a Texas broker’s antitrust challenge to the National Association of Realtors’ three-way membership structure, handing NAR another legal win in a fight over whether access to a multiple listing service can be tied to membership in local, state and national Realtor associations.

In a Sept. 9 decision, a three-judge panel of the U.S. Court of Appeals for the Fifth Circuit affirmed the dismissal of Eytalis v. Texas Association of Realtors, a case brought by broker Luz de Amor Eytalis against NAR, the Texas Association of Realtors, the Wichita Falls Association of Realtors and Paragon MLS Connect. The court’s two-page opinion said the allegations in Eytalis’s third amended complaint were insufficient to establish an antitrust injury, which is necessary to pursue a Sherman Act claim.

The ruling does not amount to a sweeping judicial endorsement of every aspect of NAR’s membership model. The panel did not conduct a broad merits analysis of whether the three-way structure itself is anticompetitive. Instead, it concluded that this plaintiff’s complaint failed at the threshold stage.

What the Fifth Circuit actually decided

Eytalis argued that the district court erred when it dismissed her federal antitrust claims, declined to exercise supplemental jurisdiction over state-law claims and rejected her objections to the magistrate judge’s findings.

The Fifth Circuit disagreed. According to the Sept. 9 opinion, Eytalis forfeited any challenge to the district court’s Clayton Act ruling because she failed to brief that issue on appeal. The panel then held that the facts alleged in the complaint were too conclusory to establish the antitrust injury required for standing under Section 1 of the Sherman Act.

Because the federal claims were properly dismissed, the appellate court also found no abuse of discretion in the district court’s decision not to keep the remaining state-law claims. The panel further rejected Eytalis’s argument that the lower court inadequately reviewed her objections, noting that the district judge said a de novo review had been conducted.

The result: the Fifth Circuit affirmed the lower court’s dismissal.

Why the case matters to brokers and MLSs

The dispute touches one of the industry’s longest-running structural questions: whether MLS access should be tied to Realtor association membership.

NAR’s integrated membership model connects local, state and national Realtor organizations. In many markets, brokers and agents who want certain MLS access or association services have historically joined through that structure. Critics have argued that tying participation across multiple association levels can increase costs or restrict access. NAR has consistently defended the model as lawful and voluntary.

The Eytalis decision is important because it leaves the dismissal intact at a time when MLS access rules and association structures continue to face scrutiny from brokers, courts and regulators. But the narrow basis for the decision matters just as much as the outcome. The appeals court did not announce that any possible three-way membership requirement is categorically immune from antitrust scrutiny. It held that the allegations in this case did not plausibly show the type of competitive injury needed to proceed.

That distinction is significant for the industry. A court can reject a complaint because it is legally insufficient without resolving the broader policy dispute that prompted the lawsuit.

A broader legal backdrop

The ruling comes as NAR continues to work through a period of intense legal and regulatory attention. Commission litigation, MLS access disputes, listing-policy fights and antitrust challenges have all forced brokerages and associations to reassess practices once considered routine.

In this case, Eytalis’s theory focused on alleged competitive harm from membership requirements connected to MLS access. The Fifth Circuit’s response was procedural and doctrinal: antitrust plaintiffs must identify an injury of the type antitrust law is designed to prevent, and conclusory allegations are not enough.

The court also noted that the opinion is unpublished, meaning it is not designated as binding precedent except under limited circumstances. That further limits how far industry participants should read the decision.

What happens next

The appellate ruling leaves the district court’s dismissal in place. Unless Eytalis seeks further review and a higher court agrees to take the case, the federal antitrust claims in this lawsuit are effectively at an end.

For NAR and Realtor associations, the immediate takeaway is favorable: this particular challenge did not survive. For brokers and MLS operators, the more useful lesson is that future challenges to membership-linked access rules will rise or fall on the specific facts, alleged market harm and legal theory presented.

That means the industry should resist treating the decision as either a definitive validation of every membership rule or as a meaningless technicality. It is a real legal win for the defendants, but one based on the insufficiency of the plaintiff’s allegations rather than a sweeping ruling on the entire structure.