Compass Sues Zillow Over Antitrust Concerns

Strategic Insights -

NorthJersey.com, one of the nation's largest real estate brokerages, Compass, has filed an antitrust lawsuit against Zillow, the leading real estate website in the United States, over its policy on private listings. The Zillow policy, which was implemented on May 28, permanently removes listings if they aren't posted on Zillow's site within 24 hours of being marketed elsewhere. Compass argues that this policy constitutes an abuse of Zillow's monopoly power and an anticompetitive tactic. The lawsuit seeks to prohibit Zillow from enforcing the "Zillow ban" and implementing similar policies.

Key Takeaways:

  • Compass filed an antitrust lawsuit against Zillow on June 23, 2022, in New York over Zillow's policy on private listings.
  • The Zillow policy, implemented on May 28, removes listings if they aren't posted on Zillow's site within 24 hours of being marketed elsewhere.
  • Compass argues that the policy constitutes an abuse of Zillow's monopoly power and an anticompetitive tactic.
  • The lawsuit seeks to prohibit Zillow from enforcing the "Zillow ban" and implementing similar policies.
  • Compass believes that homeowners should be able to sell their homes however they see fit, and organized real estate should not be fining and banning agents who don't steer their clients' listings into the MLS and Zillow.
  • Compass is promoting its Private Exclusives, a marketing channel that offers hidden listings to select agents and later to the public.
  • Compass founder and CEO Robert Reffkin stated, "The lawsuit is about protecting consumer choice. No one company should have the power to ban agents or listings simply because they don't follow that company's business model. That's not competition. It's coercion."

Statistics:

  • The Zillow policy removes listings if they aren't posted on Zillow's site within 24 hours of being marketed elsewhere.
  • Compass has marketed certain homes before they are more widely accessible via the Multiple Listing Service (MLS).
  • The MLS is a private, regional database where licensed real estate agents and brokers share information about homes for sale.
  • The lawsuit seeks an injunction to prohibit Zillow from enforcing the "Zillow ban" and implementing similar policies.
  • The lawsuit also seeks financial damages, but the amount is unspecified.

Sources:

  • NorthJersey.com
  • Compass founder and CEO Robert Reffkin
  • Compass
  • Zillow spokesperson
  • The National Association of Realtors (NAR)