Judge grants injunction in Keller Williams case after former franchisees move to Royal LePage

The defection of two major players in the Keller Williams Realty network to a major competitor has landed before the courts.

An Ontario Superior Court judge has granted an interlocutory (temporary) injunction enforcing non-competition clauses in two KW franchise agreements, a ruling that, if complied with, would bar the two former brokerages from operating competing real estate businesses during the term of those agreements.

In June 2025, Marvin Alexander and Sunil Daljit rebranded their brokerages and took their 600 agents to Royal LePage. Alexander and Daljit claim they were within their rights to move to Royal LePage, arguing the Texas-based franchisor undercut their promised exclusivity, brushed off alleged compliance concerns and let the Canadian system lose value.

In a decision dated Dec. 19, 2025, Justice Kurz ruled that Keller Williams has a strong case that Alexander and Daljit breached non-competition covenants while their franchise agreements were still in force. 

Territorial claims and contract terms

Sunny Daljit

The dispute centres on two long-standing “market centre license agreements” within the Keller Williams franchise system. 

According to court documents, Ottawa-based VIP Realty Inc.’s renewed agreement, signed in 2019, runs until 2028, while Mississauga-based Associates Realty Solutions Inc. (ARS)’s renewed agreement, signed in 2020, runs until 2031. Keller Williams states that the brokers opened competing franchises before the terms of their license agreements with expired, and claims they’re directly competing with it in the areas covered by their Keller Williams license agreements.

On June 24, Alexander and Daljit sent a termination notice to end their agreements. VIP and ARS then rebranded as Royal LePage franchises, announced the move publicly and redirected their websites to their new platforms.

Alexander, who served as KW’s Canadian director until 2017, claimed Keller Williams had promised him exclusive rights to all of Ottawa after he was allegedly asked to help stabilize the brand there following a defection of 300 agents to Remax Canada.

Keller Williams denied that it ever granted him that broad level of exclusivity. Alexander said that the refusal to recognize VIP’s exclusivity to the entire Ottawa area was the “straw that broke the camel’s back”, leading to his move to Royal LePage.

The court found that the VIP agreement clearly defined a narrow awarded territory.

“The Defendants were unable to produce one document in which KWR agreed to or acknowledged a claim by Alexander or VIP to the entire territory of the City of Ottawa,” Kurz wrote, adding that Alexander, highly familiar with the Keller Williams system, was well aware that any territorial change required written approval. 

Broker says Keller Williams ‘devalued’ the brand

Alexander and Daljit denied wrongdoing, arguing Keller Williams abandoned them first. 

Alexander submitted that Keller Williams “was not living up to its end of the bargain by devaluing the brand [he] had invested so much of [his] time and money into.” 

Alexander cited several alleged failures by the franchisor, including: 

• Failing to adapt its U.S.-based system to the Canadian market
• “Fleecing” franchisees with ever-increasing fees in connection with mandatory technology and services that do not work as promised
• Failing to comply with Canadian regulatory and tax requirements
• Permitting vast revenues generated in royalties from Canadian franchisees to be diverted outside of the Canadian Keller Williams system
• Failure to provide corporate support or a sufficiently meaningful presence in the Canadian marketplace

The judge was unpersuaded by the argument that Keller Williams allowed its Canadian system to lose all value. The decision cites substantial growth in listings and agent counts, continued use of Keller Williams branding and training and significant investments made by the defendants themselves.

License agreements acknowledged the value of Keller Williams’ “training, trade secrets and confidential information,” which the court said directly contradicted claims the system was worthless.

Alleged illegality of Keller Williams system

Alexander and Daljit alleged that they recently discovered from others that the Keller Williams profit-sharing model appears to be unlawful because it does not comply with Canadian tax law. 

They assert that they have been advised that some Keller Williams brokerages were audited by the Canada Revenue Agency in regard to that profit-sharing system. 

They add that the CRA found that such payments were subject to the Harmonized Sales Tax (“HST”). They blame KWR for failing to advise them to collect HST when making profit-sharing payments to their associates.

The judge found that the brokers ultimately failed to offer any concrete evidence of any potential HST tax liability to the CRA. Rather, Kurz said the claim was based on hearsay and speculation.

“Nothing prevented the Defendants and their businesses from obtaining accounting/legal advice as to the tax position of their profit-sharing payments,” wrote Kurz, adding, “I do not accept the Defendants’ argument that the KWR profit-sharing system is ‘illegal’ or that KWR acted improperly in regard to that system.”

Irreparable harm

Keller Williams argued that allowing mid-term defections would undermine the entire franchise model. As set out in their factum, Keller Williams warned:

“If a franchisee is permitted to take the benefit of the KW System, only to jump ship to a competitor while the term of their franchise agreement is ongoing, it will be impossible for KWR to protect its rights, leading to an erosion in value not only for KWR but for all franchisees that rely on that system and its protections.”

Justice Kurz accepted that position, finding the loss of two major franchises and approximately 600 agents to a direct competitor in Ottawa and Mississauga would cause permanent harm to goodwill and market position that damages could not adequately remedy.

Balance of convenience

On the balance of convenience, Alexander and Daljit argued that enforcing the injunction could leave them unable to operate profitably or comply with their obligations to Royal LePage. 

The court rejected that submission, emphasizing the defendants’ own conduct.

“The Defendants are sophisticated businessmen who knew what they were doing when they chose to leave KWR in favour of RLP,” Kurz wrote. “In fact, they were paid by RLP to do so.” 

Their refusal to disclose the amounts paid, the judge added, did not assist their case, and it was a fair inference that the payments were “at the very least, significant.”

The court directed the parties to attempt to resolve costs, with submissions to follow if necessary.

Royal LePage response 

A statement provided to Real Estate Magazine by a Royal LePage spokesperson says Alexander and Daljit are “disappointed with the court’s recent interim decision and respectfully disagree with the outcome.”

“They maintain their confidence in the merits of their position, and are working with legal counsel to reverse this decision through the appropriate legal process,” reads the statement. While the injunction enforces the non-compete clauses, it does not explicitly order the brokerages to cease operations. As of publication, the former KW offices continue to operate under the Royal LePage banner.

Keller Williams says brokers remain welcome

Keller Williams director of public relations Darryl Frost said the company hopes to see the pair return.

“The defendants and their affiliated agents continue to be welcome at Keller Williams, and we hope to see them return as valued representatives of the Keller Williams brand,” he said.

He said Keller Williams is pleased with the decision, and “We remain committed to requiring that the defendants uphold their contractual obligations and will continue to address this matter through the appropriate legal process.”