The Seattle-based brokerage had been battling its former brokers in federal court in Southern California for nearly three years.
Windermere, the Seattle area’s biggest real-estate brokerage, has won a $1.5 million jury award against two of its former brokers who sued the company in the fallout of a shaky expansion into the Southern California desert.
Bob Bennion and Bob Deville, who are now co-owners of a large Seattle luxury real estate firm called Avenue Properties, sued Seattle-based Windermere in federal court in 2015. The duo had been longtime agents with the brokerage and opened 14 Windermere franchises in the Palm Springs area starting in 2001, later signing a deal to expand throughout Southern California.
But Bennion and Deville had claimed they received poor support from Windermere, and alleged the company knew little about California and did not even have technology to support the area’s multiple listing service. They also argued franchisees left in droves as Windermere raised fees on them, and that the company used private information about them to try to ruin them financially.
Windermere filed a counterclaim, arguing the two brokers grew faster than their cash flow could support. The company said it forgave half a million dollars in franchise fees owed by the brokers during the housing bust and gave them $1.25 million in loans.
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On Thursday, a federal jury in Orange County sided with Windermere and awarded the company $1.53 million in back franchise fees and other costs owed by the brokers, according to Windermere co-president Mike Teather.
Teather said he still had mixed emotions. Bennion and Deville ultimately broke ties with Windermere and are still operating their brokerage in the Palm Springs desert, while Windermere has since opened new offices there to replace what it lost in the divorce.
“The unfortunate part is we were friends for a lot of years,” Teather said. “So although we’re really happy the jury saw the case our way, it’s not great when a relationship breaks down. This one certainly broke down.”
In a statement, Deville said they were “obviously disappointed” with the jury’s decision to award Windermere money and hinted at a possible appeal.
“We’ve said all along that regardless of the final outcome, we are already victorious. We won the day we broke away from the Windermere franchise model and became Bennion Deville Homes” Deville said, noting the firm has grown to over 1,000 agents since breaking ties with Windermere.