By Jonathan Stempel
NEW YORK, Feb 6 (Reuters) – A federal judge on Friday rejected a bid by Compass, the largest U.S. residential real estate brokerage, for an injunction requiring Zillow to list more homes on its real estate platforms.
Compass accused Zillow, the largest U.S. online real estate portal, of violating antitrust law by refusing to list homes that brokers had marketed privately for more than one business day, and conspiring with Redfin to keep homes off that platform. It called Zillow’s conduct the “Zillow ban.”
In a 50-page decision, U.S. District Judge Jeannette Vargas in Manhattan said Compass was unlikely to succeed on the merits of its claims, making a preliminary injunction unwarranted.
Vargas said New York-based Compass failed to show direct evidence of an anticompetitive agreement between Zillow and Redfin.
The judge also found no “clear showing” that Zillow monopolized online home listings, even accepting Compass’ likely overstated claim that the Seattle-based company might command a 50% to 66% market share.
Zillow has about 165 million homes in its database, and averaged 250 million unique visitors per month in last year’s third quarter.
“Today’s decision is not a loss, and our lawsuit continues,” Compass Chief Executive Robert Reffkin said in a statement. “With agents being our clients, we have an obligation to protect our agents from Zillow.”
Zillow, in a statement, called the decision a “clear victory” for the company, home buyers and brokers.
“At a time when Americans are struggling to afford a home amid a major housing shortage, hiding listings in private networks only deepens the crisis,” it said.
ZILLOW, REDFIN LIKELY ACTED INDEPENDENTLY, JUDGE SAYS
Most people shopping for homes say they use the internet when searching.
Compass said the Zillow ban was designed to steer all U.S. home listings to Zillow’s platform, ensuring a monopoly and boosting profit.
Vargas, however, said Zillow’s and Redfin’s conduct more likely reflected independent responses to a new National Association of Realtors policy toward listings, and to the proliferation of networks where brokers list homes privately.
She also said that while Zillow’s name recognition helps boost market share, it does not appear to have deterred prospective home buyers from shopping “at little or no cost” on other platforms.
Zillow and Redfin, a unit of Rocket Companies, separately face lawsuits by the U.S. Federal Trade Commission and five states accusing them of conspiring to thwart competition for online rental listings.
In afternoon trading, Zillow shares were up 2.7%, while Compass shares were up 2.4%.
(Reporting by Jonathan Stempel in New York; Editing by David Holmes and Andrea Ricci )
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