This is a grey area that doesn’t have a clear answer. While listing brokers have a duty to treat all parties fairly, they also have a duty to act in the seller’s best interests. These duties can be rather conflicting in a situation like this.
In an ideal world, the listing agent of a hot property would give the first buyer with an accepted offer a certain number of days to sign a contract before sending out a second contract to another buyer. At least this way the first buyer will have had a chance to sign it quickly before the deal is taken away from them.
In this ideal world, the listing agent would also disclose to all parties exactly what is going on, and that multiple purchase contracts will be sent out. In this ideal world, the listing agent would also give the first buyer an opportunity to match the price of the new buyer.
But then again, real estate in places like NYC is anything but an ideal world. NYC real estate is often compared to the Wild West of the 19th century, and in practice listing agents will send out multiple contracts and accept multiple offers without bothering to even notify buyers that they have competition. After all, it wouldn’t be in the best interests of their seller if one of the buyers backed out because of the prospect of a competing buyer right?