Zillow and Redfin Move to Dismiss FTC Lawsuit Over Rental Syndication Deal

Zillow and Redfin have asked a federal court to dismiss the FTC’s antitrust challenge to their rental listing syndication partnership, pushing back hard against claims that the deal was designed to sideline competition.

The motion, filed on Tuesday in U.S. District Court in Virginia, follows the consolidation of two related lawsuits in late November. The original legal action was brought by the Federal Trade Commission alongside attorneys general from Virginia, Arizona, New York, Connecticut and Washington.

At the heart of the case is a rental syndication agreement under which Redfin exited much of the multifamily rental listings space and began distributing listings through Zillow. Regulators have characterised the arrangement as effectively Zillow paying Redfin around $100 million to stop competing.

In a memorandum supporting the motion to dismiss, the companies argue the deal does the opposite, claiming it “makes renters and property managers better off and the rental advertising business more competitive.”

Zillow and Redfin say the partnership expanded the volume and reach of rental listings available to consumers, while delivering more qualified renter leads to landlords. They also point to Redfin’s struggles to scale its standalone rentals business prior to the agreement, and Zillow’s desire to strengthen its rental marketplace for both users and advertisers.

According to the filing, the deal allowed Redfin to redeploy capital away from an “underperforming rental advertising business” and into areas where it competes more directly with Zillow and other portals for consumer traffic.

The defendants also take aim at the regulators’ legal framing, arguing the plaintiffs failed to show any actual harm to competition. They say the lawsuit overlooks the two-sided nature of rental marketplaces, serving both landlords and renters, and relies on an incorrectly defined market that overstates Zillow and Redfin’s market power.

A hearing on the motion to dismiss is scheduled for 25 February. The case is one of five major lawsuits Zillow is currently facing.