Real Estate Firm Challenges Rival in Court; 'Exclusive Dealing' Resort Contract Called Unfair

Article excerpt

Byline: Tom Ramstack, THE WASHINGTON TIMES

A lawsuit filed last week by a Virginia real estate company accuses Wintergreen Resort of unfair competition in selling homes and lots on its property in Nelson County.

Mountain Area Realty claims $6 million in damages resulting from a contract that gives preferential treatment to Wintergreen Resort's real estate partner, Roy Wheeler Realty Co.

The lawsuit in federal court in Alexandria tests the extent to which resorts can control real estate sales on their property with "exclusive dealing" contracts, which give favored status to a single company.

Central Virginia's Wintergreen Resort is a popular weekend destination for many Washington residents, who go to its mountains to ski, golf or seek outdoor adventures.

Mountain Area Realty, of Wintergreen, says homes on the 11,000-acre property might come with inflated sales commissions because of the lack of competition.

Several resorts in the Mid-Atlantic region, such as Whitetail Resort at Mercersburg, Pa., and Kingsmill Resort & Spa at Williamsburg, Va., use real estate firms to sell homes on their property.

Wintergreen Resort and Roy Wheeler Realty joined Sept. 1 to form Wintergreen Resort Premier Properties, which has the exclusive rights to advertise as the "official real estate company of Wintergreen Resort," operate an office on resort property and distribute marketing materials there. Other real estate firms can sell property at Wintergreen Resort, but not with the preferred treatment of Wintergreen Resort Premier Properties.

The exclusive dealing contract has given Wintergreen Resort Premier Properties a "dominant position" in the home sales market at the resort, driven out at least three competitors and left Mountain Area Realty with only a portion of the sales it normally would receive, Mountain Area Realty's attorney said.

Wintergreen Resort Premier Properties "is charging sellers 6 percent commissions," said Allen Foster, attorney for Mountain Area Realty. "Mountain Area Realty was charging 5 to 5 1/2 percent. So we know consumers are being harmed."

The lawsuit accuses Wintergreen Resort of violations under the 1890 Sherman Antitrust Act, the Virginia Antitrust Act and the Consumer Protection Act, as well as conspiracy and fraud. …