Zillow has initiated an antitrust lawsuit against Midwest Real Estate Data (MRED) and Compass, alleging a conspiracy to undermine Zillow’s access to Chicagoland listing data. The legal action, filed in federal court in Chicago, stems from an April agreement where Compass committed to sharing its nationwide listings through MRED’s private listing network.
Key Takeaways
- Zillow claims MRED and Compass colluded to threaten Zillow’s Chicagoland listing data feed.
- The arrangement allegedly allows Compass to extend its influence beyond Chicago and pressure competitors.
- MRED reportedly demanded Zillow reinstate Compass’s private listings or face termination of its data access.
- Zillow alleges violations of the Sherman Antitrust Act, citing unfair competition and consumer harm.
Allegations of Collusion and Market Manipulation
The lawsuit centers on an agreement between MRED and Compass, which Zillow asserts allows Compass agents nationwide to enter listings into MRED. Zillow contends this arrangement grants Compass leverage beyond Chicago and forces competitors to abandon consumer protections. According to Zillow, MRED demanded in early May that Zillow reinstate Compass’s private listings from outside its territory, threatening to cut off Zillow’s data access if it refused.
MRED’s Board Influence and Rule Reshaping
Zillow highlights that Compass reportedly holds a significant portion of MRED’s board seats and controls a substantial share of sales in the Chicago market. Zillow believes MRED has used this influence to alter its rules in favor of Compass, potentially at the expense of other industry players. The agreement also includes Compass subsidizing membership costs for its agents joining MRED, a move Zillow claims could significantly increase MRED’s size and its power to dictate industry rules.
Impact on Competition and Consumers
Zillow argues that MRED, by agreeing to use its control over Chicago-area listing data, is pressuring platforms that adopt stricter transparency rules. Zillow’s Chief Industry Officer, Errol Samuelson, stated that the lawsuit is fundamentally about protecting consumers and competition in the real estate industry. He criticized the arrangement for skewing rules to harm consumers and competition, undermining the MLS’s role as a fair marketplace. Samuelson further expressed concern that MRED is threatening to restrict access to Chicago listings on Zillow to protect Compass listings in other states, calling the situation "egregious."
MRED has not yet responded to a request for comment. This is a developing story.