Redfin, Zillow Seek To Dismiss Antitrust Lawsuit Filed By Regulators 

Zillow and Redfin are seeking to dismiss a recently combined lawsuit related to the two firms’ rental property syndication deal. 

Antitrust lawsuits filed by the Federal Trade Commission (FTC) and attorneys general in Virginia, Arizona, New York, Connecticut and Washington claimed that the syndication deal executed by Zillow and Redfin was tantamount to Zillow simply paying Redfin $100 million in exchange for it no longer competing in the multifamily rental listing space. The two lawsuits were consolidated in late November. The lawsuit was filed in U.S. District Court in Alexandria, Va. in September.

Redfin and Zillow filed their motion to dismiss the combined lawsuit on Tuesday. 

In a memorandum filed in support of the motion, the defendants claim that the regulator plaintiffs are challenging a collaboration that “makes renters and property managers better off and the rental advertising business more competitive.”

The defendants argue that by partnering, they are able to provide consumers with more rental listings and in turn provide more prospective renters for landlords. 

The parties claim that they embarked on this partnership after Redfin had struggled to grow its real listings and because Zillow was looking to “provide a better platform for renters and deliver stronger performance to advertisers.”

Additionally, according to the filing, Redfin claims that the partnership has allowed it to redirect the funds it was spending on its “underperforming rental advertising business,” to better compete against Zillow and other platforms for even more renters. The defendants go on to argue that the plaintiffs fail to present facts showing that the partnership between Zillow and Redfin has harmed competition. 

The memorandum also argues that the plaintiffs fail to take into account that the two listing portals are two-sided platforms geared toward both landlords and renters, as Redfin and Zillow feel that the plaintiffs only focused on how the partnership impacts landlords. They also argue that the plaintiffs incorrectly defined the market and that they don’t adequately show that Zillow and Redfin have enough market power to harm competition. 

A hearing on the motion to dismiss is scheduled for February 25.