When Dave Liniger and his wife Gail cofounded RE/MAX in 1973, his business model was revolutionary and controversial—allowing real-estate agents to keep the maximum amount of their commissions in return for sharing in office overhead and paying a management fee. In an interview with Fortune, the RE/MAX chairman compared it to a group of lawyers sharing the expenses of running an operation and keeping the majority of their earnings to themselves. It took him about three years to get a foothold in their homebase of Denver, then they started to franchise and expand internationally, and “the rest is history,” says Liniger, who served as a long-time CEO, as RE/MAX became one of the top real-estate franchisors nationwide, which is how it found itself as one of the five defendants in a lawsuit that became a $1.8 billion verdict that rocked the industry.
The Missouri jury struck a huge blow against the National Association of Realtors and RE/MAX’s peers in the real-estate space, finding they were part of a national antitrust conspiracy to gouge buyers and sellers. Good thing Liniger settled in September for $55 million before the trial started—and good thing that settlement applies to a separate class-action antitrust lawsuit that hasn’t even gone to trial yet. Liniger says he would have rolled the dice and gone to trial if it were just his future on the line. But he said he and his leadership team did the best thing for all their members. “Those franchisees invested their life with us.”
