When is a real estate agent a Realtor? The National Association of Realtors has held a trademark on the term since 1949, but many people still think all agents are Realtors. The courts and the U.S. Patent and Trade Office all disagree.
Trademarked Title
In 1916, Charles Chadbourn, a real estate agent in Minneapolis, wrote an article calling for a professional title that would separate trained, professional agents from regular sales representatives. He coined the term Realtor. The term was formally adopted by the National Association of Real Estate Boards, which later became the National Association of Realtors (NAR).
The terms “Realtor” and “Realtors” are collective membership marks registered with the U.S. Patent and Trade Office (USPTO). They are used to identify real estate agents whose licenses are in good standing, who subscribe to the NAR’s code of ethics, and who are dues-paying members of the NAR. The association has over 1 million members, 54 state associations and more than 1,100 local associations.
Code of Conduct
The association has strict rules for how Realtors can use the mark. Realtors are only permitted to use it with their name or with the name of their brokerage firm. They cannot use it to conduct any business that is not related to real estate. A brokerage can only use it as part of their official name if all the agents in the brokerage are Realtors.
The NAR was one of the first professional organizations to create a Code of Ethics for its members. Adopted in 1913, the code stresses cooperation among Realtors to better serve the public. According to the code, “The term REALTOR has come to connote competency, fairness, and high integrity resulting from adherence to a lofty ideal of moral conduct in business relations. No inducement of profit and no instruction from clients ever can justify departure from this ideal.”
What Does Realtor Mean?
Using the term “Realtor” shows that a real estate agent is a fully paid member of the National Association of Realtors. A Realtor may also belong to local real estate boards. Only members of the association have access to the multiple listing service (MLS), a database that lists all homes in the area for sale or rent.
Tying a NAR or local board membership to the use of the MLS has led to several lawsuits that allege unfair competition and antitrust violations. The NAR and local real estate boards have had mixed success in responding to these lawsuits.
Pope Lawsuit
In a 1989 case, a real estate company in Mississippi withdrew from the county board of realtors because it didn’t want to pay its share of fees, which included fees for using the MLS. The agency was allowed to operate, but it could not use the term “Realtor” in its advertisements.
The agency sued the Mississippi Real Estate Commission, the county board and the NAR. They alleged antitrust violations, interference with business relations and defamation. The court found for the defendants in this case.
Not a Realtor
In its ruling, the court found that the Popes could not call themselves Realtors if they do not belong to the county or national boards.
“The Popes also have no right to use the term ‘realtor’ to describe their operation,” the court concluded. “‘Realtor’ is a registered trademark. Although the Popes assert the term has come to mean any real estate agent in a generic sense, they produced no summary judgment proof to establish this fact other than the conclusionary allegation of Mr. Pope. This is not sufficient.”
Antitrust Case
In a case in New Jersey, a realtor named Wayne Pomanowski sued the county and local real estate boards and the NAR. He alleged that the requirement to “join local, state and national Realtor boards before he may access to a multiple listing service violates the New Jersey Antitrust Act.”
Pomanowski prevailed. The court found that the Monmouth County Board controlled around 70% of the real estate market in the county and that cutting Pomanowski off “has the effect of foreclosing his ability to successfully compete in the real estate business.”
Since the case did not involve Pomanowski’s wish to call himself a Realtor, the trademark issue did not come up.
Biggest Challenge to NAR’s Trademark Status
The biggest challenge to the NAR’s standing came in a 2004 petition filed by Jacob Zimmerman. In a challenge filed with the USPTO, Zimmerman argued that “realtor” is a generic term.
To support his view, he cited the regular appearance of the word in popular literature, news media, social media and other sources.
Realtor Domain Names
Zimmerman was a website designer who also bought and sold websites that dealt with real estate and real estate agents. At the time he filed the petition, he owned 1,900 domain names with the term “realtor” in them. Zimmerman alleged that the Realtor trademarked prevented him from marketing those domain names to real estate agents.
Read more on trademarks and domain names.
Many of these website names include the term “realtor,” for instance, bostonrealtors.org. Zimmerman said real estate agents wouldn’t buy his website names because they did not want to violate the law and feared legal action from the NAR.
Threat of Lawsuits
Zimmerman cited “the threat by NAR to enjoin the use of such website names” as harmful to his business. He petitioned the USPTO to cancel the trademark because “realtor” is so commonly used that it is generic.
The NAR responded by pointing out that its “registered collective marks are distinctive, not generic” and that these marks have been in use since 1916. It also pointed out that they are “collective marks” based on membership. The NAR argued that while the public may view a certain mark as generic, the professionals who use that mark do not.
Public or Professional Perceptions
In ruling for the NAR, the USPTO agreed that while the public may be confused about what a Realtor is, the members of the NAR are not.
“While petitioner argues that members of the general public make up the relevant universe for our determination,” the panel said, “respondent would have us find that real estate professionals are the correct universe for determining customer perceptions.”
NAR’s Policing Efforts Protect Its Trademark
The USPTO panel also pointed out that the NAR regularly monitors all uses of the term and promptly sends letters reminding journalists and the public that Realtor is a trademarked word.
“Respondent’s policing efforts with respect to such uses demonstrates that respondent does not permit such uses to go uncontested and shows that respondent continually takes affirmative steps” to reinforce the mark’s status.
“In short,” the USTPO ruled, “The marks Realtor and REALTORS continue to function as collective service marks and have not become generic terms.”
More on common word or phrase trademarks.
Still Not Generic
Since the decisive 2004 Zimmerman decision, there have been no significant challenges to the trademark status of Realtor. As the USPTO pointed out, the association’s constant vigilance has helped protect its trademark. The NAR continues to educate its members and the public about who may call themselves a Realtor.
