Zillow, MRED, Compass make 11th-hour bid in latest legal filings
The portal, MLS and brokerage are anticipating a ruling on whether Zillow will retain access to MRED’s data feeds. The judge could decide as soon as next week.
In new legal filings this week, Zillow, Midwest Real Estate Data (MRED) and Compass reiterated the arguments they recently presented in a preliminary injunction hearing over whether Zillow can keep its access to MRED's data feeds while also enforcing its listing standards.
The trio of filings submitted to the court on July 9 follow last week's two-day hearing in Chicago. All parties now await the judge's decision.
An 'unlawful conspiracy': In its supplemental brief, Zillow maintained its argument that MRED and Compass entered into an "unlawful conspiracy" to cut Zillow's access to MRED's data feeds — a move the portal alleges was a response to its efforts to discourage "harmful" private listings through the Listing Access Standards (LAS) it rolled out last spring.
Zillow argued that it met all requirements for a preliminary injunction blocking MRED from cutting Zillow's feed, including a likelihood of success based on the merit of its claims that the two companies worked together to "coerce" Zillow to abandon its LAS. This, Zillow said, was shown in communications between Compass and MRED in the months leading up to its feed termination.
Without an injunction, Zillow said it would be "irreparably harmed" in Chicagoland and nationwide due to a loss of customers that it suggested could have a trickle-down effect on other aspects of its business.
The portal likewise argued that the public interest weighs in favor of a preliminary injunction because it would enforce antitrust laws and allow Zillow to compete with its pro-transparency policies "without the Damoclean threat of losing a key competitive input in Chicagoland."
A 'self-inflicted' wound: But Compass and MRED argued that Zillow is not entitled to relief from MRED's data feed block because any harm the portal is incurring is "self-inflicted."
In a joint filing, the brokerage and MLS framed the dispute as two entities with rules "at war with each other." Zillow's rules, they alleged, seek to limit competition. Zillow's LAS, the introduction of which the portal framed as a move in favor of transparency, actually works to conceal listings that have previously been publicly marketed elsewhere, according to the defendants.
Compass and MRED also argued that each company worked in their own independent self-interest to defend against Zillow's threats against them and did not enter into a horizontal group boycott, as Zillow has alleged. Both said they would prefer to not have Zillow's data feeds permanently suspended and merely want Zillow to stop banning and/or misrepresenting their listings.
In its own separate filing, MRED rebutted Zillow's monopolization claims against the MLS. MRED argued that Zillow failed to establish a relevant monopolized market for its claims and said MRED has no monopoly power in Zillow's defined market. The MLS further argued that it has no obligation to deal with Zillow, and that its procompetitive reasons for enforcing its own objective criteria rule adequately rebut any anticompetitive conduct allegations.
Zillow's conclusion: Evidence presented in last week's preliminary injunction hearing showed that MRED and Compass conspired to "protect a hidden listing scheme," Zillow said.
"MRED's own CEO testified that 'all of this could have been avoided' if Zillow abandoned its transparency standards — standards that exist to ensure every buyer can see every home for sale," a Zillow spokesperson said in an email.
The defense's take: A Compass International Holdings spokesperson characterized Zillow's business model as exploitative — one where agents do all the leg work and bear all the costs of creating listings while Zillow "simply takes millions of those listings" without having to compete for them before selling the buyer leads that come out of those listings back to agents.
"Zillow's ban hurts consumers and merely serves to entrench Zillow's dominance and block consumer choice," the Compass spokesperson said in an email.
"Buyers on Zillow are not told that listings are being filtered," the spokesperson added. "There is no disclosure that the available inventory has been hidden from them. MRED's Private Listing Network (PLN) has existed for over 10 years without complaint."
MRED did not immediately respond to a request for comment.
The judge's decision is expected after all parties' responses have been filed with the court. The deadline for them to file is July 13.