Redfin's "We Already Left" Defense: What It Means for the Batton 2 Lawsuit

By Frances Flynn Thorsen

When Redfin filed its response to the second amended complaint in Batton 2 on April 28, 2026, most observers expected the usual boilerplate denials. And they got those — but buried in the filing was something far more interesting: an affirmative defense that legal scholars call the "withdrawal doctrine."

Redfin's argument, in plain English: "We left the conspiracy before the damages period began. You can't hold us liable for what happened after we walked out the door."

Here's what that defense requires, how strong it is, and what it means for the case.

What the Withdrawal Doctrine Requires

The withdrawal doctrine is a recognized defense in both criminal and civil antitrust law. To successfully withdraw from a conspiracy, a defendant must:

1. Take affirmative action to disavow or defeat the conspiracy's purpose — not just stop participating passively

2. Communicate the withdrawal to co-conspirators in a way that makes clear the defendant is no longer part of the scheme

3. Withdraw before the statute of limitations period for the damages being claimed

The leading Supreme Court case is Smith v. United States (2013), which held that withdrawal is an affirmative defense — meaning the defendant bears the burden of proving it, not the plaintiffs.

Redfin's Timeline

Redfin's withdrawal argument rests on a specific timeline:

• 2006–2017: Redfin operates as a NAR member, subject to the Cooperative Compensation Rule

• 2017: Redfin begins publicly criticizing NAR's commission structure, calling it "fundamentally broken"

• 2020: Redfin launches Redfin Direct, a buyer-direct service that bypasses traditional buyer-broker commissions

• October 2023: Redfin formally resigns from NAR, citing the Cooperative Compensation Rule as a primary reason

• August 2024: NAR's settlement takes effect, eliminating the Cooperative Compensation Rule from MLS rules

The Batton 2 damages period runs from approximately 2015 to 2024. Redfin's resignation in October 2023 falls within that window — which is why the withdrawal defense is complicated.

The Core Problem: Timing

The withdrawal doctrine requires that the defendant withdraw before the damages period, not during it. If the damages period runs from 2015 to 2024, and Redfin resigned from NAR in October 2023, then Redfin was arguably part of the conspiracy for most of the damages period.

Redfin's response to this problem will likely be one of two arguments:

Argument 1: The relevant withdrawal date is 2017, not 2023. Redfin will argue that its public criticism of NAR's commission structure beginning in 2017 — and its launch of buyer-direct services — constituted an affirmative act of withdrawal from the conspiracy, even before the formal resignation. Under this theory, Redfin's liability would be limited to the 2015–2017 window.

Argument 2: The damages period should be measured from the date of injury, not the date of the conspiracy. Redfin may argue that buyers who transacted after 2017 were not harmed by Redfin's participation because Redfin was actively offering alternatives to the traditional commission structure.

Both arguments face significant headwinds. The plaintiffs will point out that Redfin continued to participate in NAR-affiliated MLSs and offer buyer-broker commissions through 2023 — meaning it continued to benefit from and participate in the alleged conspiracy regardless of its public statements.

How Strong Is the Defense?

The withdrawal defense is weaker than it appears for three reasons:

1. Redfin continued MLS participation. Even after its public criticism of NAR, Redfin continued to access NAR-affiliated MLSs and offer buyer-broker commissions. Courts have held that continued participation in the mechanism of the conspiracy — even while publicly criticizing it — is inconsistent with withdrawal.

2. The burden is on Redfin. Under Smith v. United States, Redfin must prove withdrawal, not just raise it as a defense. That means producing documents showing affirmative steps to disavow the conspiracy — not just press releases criticizing NAR.

3. Partial withdrawal may not be enough. Even if Redfin can show it reduced its participation in the commission structure over time, courts have generally required complete withdrawal, not a gradual reduction.

What the Defense Gets Right

Despite these weaknesses, the withdrawal defense has real value for Redfin in two ways:

Damages limitation. Even if Redfin can't escape liability entirely, a successful partial withdrawal argument could significantly limit the damages period — potentially cutting Redfin's exposure from nine years (2015–2024) to two or three years (2015–2017).

Settlement leverage. The withdrawal defense gives Redfin a credible argument to make at mediation. Even if the defense ultimately fails at trial, the uncertainty it creates is worth something in settlement negotiations.

The Bigger Picture

Redfin's withdrawal defense is the first of what may become a wave of similar arguments in Batton 2 and related cases. As more defendants file answers, watch for:

• Former NAR members who resigned before the damages period ended

• Brokerages that launched buyer-direct services as evidence of withdrawal

• Companies that publicly criticized NAR's commission structure as affirmative acts of disavowal

Each of these arguments will require the courts to define exactly when and how a brokerage can "leave" a conspiracy — a question that will shape antitrust liability in the real estate industry for years to come.

Watch Dates

• May 27, 2026: Weichert mediation status report due — if Weichert settles, it increases pressure on Redfin to consider its own settlement options

• June 2, 2026: Joint status report due — will reveal whether the parties are moving toward discovery or another round of motions

This post is Part 1 of the Batton 2 Defenses Series, which examines the affirmative defenses filed by each defendant in the Batton 2 buyers' commission antitrust lawsuit.

Next installments: United Real Estate's NAR Non-Membership Defense | eXp Realty's Defense

For informational purposes only. Not legal advice.

Comparing the Three Batton 2 Defenses

For context, here is how all three defendants' strategies compare side by side. This table also appears in Part 3: eXp Realty Is Fighting Batton 2 On Three Fronts.

Continue the Series

This post is part of the Batton 2 Defenses Series — a deep dive into how each defendant is fighting the buyers' commission antitrust lawsuit.

Next → Part 2 of 3: United Real Estate's NAR Non-Membership Defense

📚 Series Overview: The Batton 2 Defenses: A Reader's Guide — Start here if you're new to the series.

DISCLOSURE: This content is for informational and journalistic purposes regarding real estate litigation and transparency. The author is an active licensee with eXp Realty LLC; however, this report is independent of that affiliation. This article does not constitute legal advice.

Image Credit: Nano Banana