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CONCORD, N.H. (AP) – A Massachusetts-based Web site that helps people sell their homes sued the state Tuesday, claiming that requiring it to become a licensed real estate broker violates its free-speech rights.

ZeroBrokerFees.com is an advertising service that should be treated just like newspapers that publish real estate ads in print and online, not like a broker, said founder Ed Williams.

The site charges fees starting at $49 for each ad, depending on how many photos and other views are included. Real estate brokers usually charge 6 percent of a home’s selling price for individualized services, which typically include repeatedly showing the home to prospective buyers.

ZeroBrokerFees.com, based in Beverly, Mass., accepts ads from all 50 states, but has been reluctant to advertise in New Hampshire for fear of being sanctioned, Williams said.

“We’ve been trying to lay low,” he said at a news conference outside federal court.

Recently, the company decided to sue rather than wait, he said. Its lawsuit, filed in U.S. District Court, seeks to have the law declared unconstitutonal and prevent its enforcement.

The Institute for Justice, a libertarian public interest law firm based in Arlington, Va., is assisting in the suit.

“Essentially, this is about consumer choice,” said institute lawyer Valerie Bayham. “The New Hampshire Association of Realtors shouldn’t be able to protect their pockets by using the regulatory power of the state.”

Members of the state Real Estate Commission and the state attorney general are named as defendants. They did not respond immediately to messages seeking comment.

Paul Griffin, executive vice president of the Realtors’ group, said he had not seen the lawsuit, but the group has no problem with Web sites and newspapers that strictly engage in advertising. It does object when Web sites call the ads “listings” and give advice and counsel to sellers, he said.

Two years ago, the Realtors association complained to the commission about ISoldMyHouse.com, a Web site owned at the time by East-West Mortgage Co. Inc., of Danvers, Mass. No final order has been issued, commission investigator Ann Flanagan said Tuesday.

ISoldMyHouse.com was sold about a year ago to Sterling Lion LLC and is now based in Marlborough, Mass. President Owen Gilman said the Web site has been completely revamped to remove any negative comments about real estate agents. Because of that, the realtors’ complaint is basically moot, he said.

“Before … the advertising was very negative,” he said. “You’re better off just to do right by the consumer and not fight everything.”

ZeroBrokerFees’ lawsuit claims state law is unconstitutional because any company that lists real estate for sale is required to get a broker’s license, even if it does not get involved in buyer-seller transactions, institute attorney Steve Simpson said. Newspapers are specifically exempted.

The lawsuit and a similar case won by the institute in California several years ago have major implications for online commerce, Simpson said. For example, some states are now trying to apply their auctioneering laws to people selling merchandise on eBay, a move he called misguided.

“There’s a complete disconnect between the regulatory structure and the reality of business these days,” he said.


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