Compass, the real estate brokerage, claims that Zillow, the website that has 227 million unique visitors a month, has conspired to maintain a monopoly over digital home listings.
Compass, the real estate brokerage that sells more houses than any of its competitors in the United States, has sued Zillow, the country’s largest real estate site — in a legal showdown that accuses Zillow of gatekeeping home listings and of breaking federal antitrust laws.
In its suit that was filed in New York federal court on Monday morning, Compass claims that Zillow is engaged in an anticompetitive conspiracy to maintain a monopoly over digital home listings. Online real estate portals have become an integral part of the home-buying process, with nearly 100 percent of buyers now reporting that they use the internet in their home searches. And Zillow, which has a database with about 160 million properties and receives about 227 million unique visitors every month, is the undisputed giant of digital real estate sites.
The lawsuit between two industry heavyweights marks a significant escalation in an ever-raucous debate over who controls home listings.
Brokerages like Compass have sought to find ways to make their listings stand out: Since November, the company has been heavily promoting its Private Exclusives, a marketing channel of about 7,000 home listings available only to Compass agents and the buyers working with them. But in April, Zillow announced that any home that was put on the market but not available for listing on Zillow within 24 hours would be forever banned from its site.
Compass calls the action the “Zillow ban.”
“To protect its market dominance, Zillow has retaliated against competitive threats by enacting an exclusionary policy,” Compass claims in its suit.
Representatives from Zillow were not immediately available for comment on the lawsuit Monday morning. Earlier this year, Errol Samuelson, Zillow’s chief industry development officer, told The New York Times that the website was created to promote transparency in the industry and that private listings are at odds with that spirit. The turf war throughout the industry has ensnarled Redfin, another online brokerage, which has taken a posture similar to that of Zillow and is called “co-conspirator” in the lawsuit, though is not a defendant.
