The Villages has filed a lawsuit against a federal agency to protect a key part of the sales strategy which has made the billion-dollar family business so successful.
The Villages is suing the Federal Trade Commission in a bid to protect its 24-month non-compete ban on former Properties of The Villages sales associates from selling real estate in The Villages.
Earlier this year, the FTC issued a final rule to promote competition by banning non-compete agreements across the nation.
“The FTC’s final rule to ban noncompetes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market,” said FTC Chair Lina Khan, who was appointed to the position by President Biden.
The Villages is arguing that the non-compete agreement, which was famously challenged in court in 2021 by some former Properties of The Villages sales representatives who struck out on their own, does not pose “unreasonable restraints on competition.”
The lawsuit insists that from the beginning, The Villages has offered a vastly different sales model.
“The Villages community started from humble beginnings in the 1980s as a mobile home park with access to free golf,” the lawsuit explains.
“The community grew rapidly thanks to the hard work of The Villages’ developers and POV’s dedicated sales team. POV models its approach to sales on the distinctive hospitality mindset of its founder Gary Morse, whose values continue to drive every aspect of POV’s family business today. Developing personal, lifelong relationships with residents, or ‘Villagers,’ is central to POV’s business model and brand. Because of the reputation POV has built, both new and returning customers frequently turn to POV and its sales team rather than third-party real estate brokers—when looking to buy or sell property in The Villages.”
The lawsuit makes the case that sales associates working for Properties of The Villages do not simply receive real estate training; they learn specifically how to sell homes in The Villages. It includes an “intensive” three-month training period.
The Villages argues that the 24-month non-compete agreement ensures that a newly trained sales associate doesn’t complete the three-month training and “walk across the street to a competitor the day after completion.” In addition, it protects The Villages from real estate competitors who might get “a free ride off its sizable investment in sales associates.”
The lawsuit against the FTC also praises the ruling three years ago by Judge James Moody, father of Florida Attorney General Ashley Moody, who sided with The Villages in the case against the realtors who jumped ship. Their case failed to undercut the 24-month non-compete agreement in the judge’s eyes.
