Zillow challenges Compass’ request to depose co-founder
Zillow made claims of harassment in a filing that also showed it offered Compass a “broader national partnership” before announcing its private listing ban.
Whether one of Zillow's co-founders can be deposed by Compass in its legal battle with Zillow is the latest issue under debate as the litigation continues.
The brokerage is arguing that Lloyd Frink, who co-founded Zillow with Rich Barton in 2006, has information regarding Zillow's private listings ban "that no other witness can provide" — a claim Zillow disputes.
Preparing for the demise of Clear Cooperation? In a Sept. 12 motion filed with Judge Jeannette A. Vargas of the U.S. District Court for the Southern District of New York, Zillow made two requests. The first was to redact portions of materials filed in the case that could cause Zillow "competitive harm," the motion suggested. Compass does not oppose this request.
The redactions would block the public release of part of a confidential document titled "Post Clear Cooperation Strategy" that "contains Zillow's detailed and confidential response strategy for several possible business scenarios," according to the filing. While the National Association of Realtors' Clear Cooperation Policy remains in effect, Zillow appears to have prepared — or to be preparing for — a time when that is no longer the case.
Zillow also seeks to seal documents relating to its "views on its relations with other participants in the real estate industry" and references to third parties involved in contract negotiations.
Compass-Zillow negotiations: Excerpts from depositions included in the filing indicate that Zillow and Compass executives met on April 1 — days before Zillow announced its private listings ban — at the request of Compass CEO Robert Reffkin.
Frink's presence at that meeting was intended to "demonstrate to Compass how serious we were about trying to find a solution," Zillow Chief Industry Development Officer Errol Samuelson said in his Aug. 28 deposition.
Zillow hoped it could "encourage Compass to support listing transparency," Samuelson said, and "we also wanted to demonstrate to Compass that … we already do a great deal to benefit Compass, and … we think there is more we could do to help Compass grow, be successful."
Further details related to Samuelson's statements were redacted.
Zillow's chief financial officer, Jeremy Hofmann, also indicated in his Aug. 29 deposition that Zillow sought a "broader national partnership" with Compass in exchange for the brokerage submitting more listings to the MLS.
Frink's role under debate: In the Sept. 12 filing, Zillow and Compass also asked the court to resolve a dispute: Whether Compass can depose Frink for four hours on Sept. 24.
Compass has argued that Frink "has unique and important information that no other witness can provide" and can speak "directly to Zillow's economic and strategic incentives to conspire and adopt" Zillow's Listing Access Standards. Compass further suggested that Frink "was an integral part of Zillow's negotiations with Compass."
Zillow, however, contends that Compass hasn't shown that Frink has unique information relevant to Compass' motion for a preliminary injunction and noted that Compass has already deposed three Zillow executives who were at the April 1 meeting "and who, unlike Mr. Frink, continued to participate in ongoing discussions with Compass."
The attempt to depose Frink is unnecessary "and lays bare Compass's apparent effort to harass Zillow by deposing yet another senior executive," the filing alleges.