Initially filed by REX in March 2021, the lawsuit alleges that modifications made to Zillow’s web site “unfairly hides sure listings, shrinking their publicity and diminishing competitors amongst actual property brokers.”
Two months previous to that, Zillow started shifting houses not listed on the MLS out of preliminary person search outcomes and onto a second tab. This adhered to an elective NAR rule, which prevents those that select to undertake it from commingling MLS listings with non-MLS listings.
Regardless of noting that it didn’t help this rule, Zillow claims it was compelled to undertake it to acquire IDX feeds from MLSs that had. This precipitated the two-tab design for MLS listings and “different listings.”
In Might 2022, REX ceased its brokerage operations. And somewhat over a yr later, the three events concerned within the case every filed motions for abstract judgment on both everything of the lawsuit or parts of it.
Decide Thomas Zilly, who oversaw the case, dismissed REX’s antitrust claims in opposition to NAR and Zillow. However he allowed the low cost brokerage’s false promoting declare underneath the Lanham Act, together with a declare for unfair or misleading commerce practices underneath the state of Washington’s Client Safety Act, to face.
At a trial in September 2023, the court docket dominated in favor of Zillow on the remaining costs. Roughly six weeks later, REX filed its movement for a brand new trial. Within the request, REX argued that it was unfairly prevented from presenting testimony about agent commissions to the jury.
A Seattle jury in the end discovered that REX didn’t show Zillow used false promoting in its choice to place non-MLS listings on a unique part of the web site. It additionally discovered that Zillow proved its protection on REX’s second declare that Zillow acted deceptively and unfairly.
REX filed its enchantment in February 2024 after Zilly denied REX’s movement for a brand new trial.
In its ruling, the appeals court docket wrote that “the no-commingling rule itself just isn’t direct proof of concerted motion that ‘joins collectively separate decisionmakers.’”
“Every NAR affiliated a number of itemizing service (“MLS”) independently selected whether or not to undertake the rule, and certainly twenty-nine % of them didn’t,” the ruling states. “The rule was actually elective and doesn’t set up a Part 1 settlement by itself.”
The panel additionally wrote that Zillow made the choice to revamp its web site to adjust to the rule by itself. It added that REX didn’t present “both direct or circumstantial proof demonstrating that NAR agreed to this web site design, or that Zillow did something greater than ‘merely settle for‘ and adjust to the elective no-commingling rule promulgated by NAR and adopted by some MLSs.”
Moreover, the ruling notes that the rule doesn’t direct how Zillow or others ought to individually show listings from MLS and non-MLS sources.
“Thus, REX can’t show that Zillow and NAR dedicated to a standard, anti-competitive scheme and the district court docket accurately granted abstract judgment,” the ruling states.
The ruling additionally addresses claims made by REX in oral arguments that Zillow conspired with particular person MLSs to implement the no-commingling rule.
“REX by no means made a concrete allegation of a separate conspiracy involving Zillow and particular person MLSs,” the ruling states. “In its Amended Criticism, REX referred repeatedly to the ‘NAR/MLS regime’ or ‘NAR/MLS cartel.’ REX additionally alleged a nationwide conspiracy ‘[b]ecause Zillow’s common show change concealing non-MLS listings is applied nationally’ and didn’t restrict its allegations to solely these jurisdictions the place an MLS had adopted the no-commingling rule.
“Any conspiracy between Zillow and MLSs alone was not clearly raised earlier than the district court docket and accordingly needn’t be thought of on enchantment.”
In an emailed assertion, a NAR spokesperson wrote that the choice emphasizes NAR’s declare that the no-commingling rule by no means constituted an antitrust violation.
“The rule is elective, leaving MLSs the selection whether or not to undertake it, and, actually, 29% of them selected to not,” the spokesperson wrote. “We’re happy to place this meritless lawsuit behind us and preserve our concentrate on delivering worth for our membership.”
Zillow and REX didn’t return HousingWire’s requests for remark.
