Zillow Antitrust Lawsuit Thrown Out By Court—Again

September 2, 2022
Share this Post: 

A federal district court has thrown out a false advertising and antitrust lawsuit against Zillow for the second time.

Zillow was sued over its For Sale By Owner listing feature by FSBO site Picket Fence in December 2020.

Picket Fence alleged that Zillow used a predatory pricing model that unfairly directed FSBO homebuyers directly to Zillow's paid advertising customers, a claim which was dismissed in August 2021.

Now an amended claim has been thrown it, marking the second time the case has been dismissed.

Picket Fence has until September 23 to appeal the decision—an option it intends to exercise.

Picket Fence has argued that:

"Zillow has engaged in illegal and unfair methods of competition as well as fraud and deceit by setting up a bait and switch scheme for Zillow’s ‘free’ listings for For-Sale-By-Owners and then making it difficult, or impossible, for prospective buyers to contact those seller’s directly.

"Zillow’s pricing scheme is also predatory, in that Zillow claims it is offering a service for free, but in reality is charging the Premier Agents so they can advertise on the website of those free ads and receive hijacked inquiries from deceived buyers. This creates an unfair playing field for legitimate For-Sale-By-Owner publications."

After the first complaint was dismissed, Picket Fence was allowed to amend its claim, which it did.

Zillow then asked the court to dismiss the amended complaint in October 2021, with the request granted last week.

Judge Christina Reiss ruled against Picket Fence, saying a “non-consumer competitor” could not bring claims on the consumer’s behalf, nor had Picket Fence “plausibly plead the essential elements of a predatory pricing claim.”

"Defendant’s practices do not preclude consumers from advertising with multiple FSBO listing services simultaneously."

On the false advertising claim, Reiss said:

"Picket Fence has not identified a statement made by Defendant that is ‘either literally or impliedly false'.

"A FSBO seller remains free to decide with whom and how it wants to sell any property it lists on Defendant’s website. Stated differently, a FSBO seller may refuse to deal with a real estate agent and refuse to pay a commission."

After the ruling, a Zillow spokesperson said:

"We strive to serve as a fair and open online marketplace by providing consumers with access to the most information available about residential real estate, which includes giving homeowners the option of using for sale by owner (FSBO) postings on our site for free."

"Additionally, as part of our mission to empower all consumers, our site provides shoppers with tools that help them find their next home such as the option to connect directly with the seller of a FSBO or a real estate professional."

September 2, 2022
Harvey is an experienced property journalist and copywriter. He has written about the property industry since 2015, starting at The Property Franchise Group in the UK, before moving to Spain to work for Spotahome. He has blogged for the private rented sector, ghostwritten for UK property experts and written case studies for franchise owners around the UK. Harvey joined Online Marketplaces as a News Editor in 2022.

Subscribe to our mailing list to get the famous, free Friday newsletter!

News and analysis to help build better online marketplace businesses, in your inbox, every Friday

Related News

Shutterstock 147091049
Housing.com To Hire 200 People In Market Leadership Push

Housing.com will hire up to 200 staff in fiscal year 2023 as it aims to establish itself as India's leading...

Read More
Propertyguru For Business Skyline Singapore
'Guided by Guru' - PropertyGuru Outlines New Brand Positioning

The Southeast Asian real estate portal operator PropertyGuru has announced a 'brand repositioning' and has introduced a new umbrella brand...

Read More
Shutterstock 1958725735
Spotahome Tells Staff That It Expects Another Round of Layoffs

Madrid-based on-demand rentals specialist Spotahome has announced it will go through another round of layoffs, weeks after firing two senior...

Read More
Homely And Ptg Skyline
Aussie Portal Homely Integrates with Proptech Group's VaultRE and Eagle CRMs

Australian challenger portal Homely.com.au says it will be easier than ever for agents to list in more places after announcing...

Read More

Editor's Pick