MRED warns Zillow lawsuit could revive MLS antitrust risks

Midwest Real Estate Data (MRED) is warning that its legal dispute with Zillow over listing display rules could undermine long-standing federal antitrust principles governing multiple listing services and broker cooperation, according to a blog post on Thursday from the Chicagoland MLS.

In the post, MRED links the current legal fight with Zillow to the Department of Justice’s 2008 settlement with the National Association of Realtors (NAR), which challenged MLS rules that were seen as disadvantaging Internet-based brokerages. That settlement cemented a core principle: MLSs and brokers must treat competing business models consistently, and MLS cooperation cannot favor one competitor over another. In practice, what this has meant is that brokerages cannot exclude listings that belong to competing brokerages from the listing feeds they display on their websites. The terms of this settlement expired in November 2018. 

In the lawsuit filed by Zillow in mid-May, MRED has alleged that Zillow’s listing access standards policy goes against the spirit of this settlement, as it means that, when enforced, the policy results in the listing portal excluding some listings from display based on criteria that MRED says conflict with its Internet Data Exchange (IDX) data licensing agreement. 

At the center of the lawsuit is the issue of whether MRED can suspend its IDX and VOW listing data feeds to Zillow if the listing portal filters or suppresses certain listings and whether Compass International Holdings, the suit’s other defendant, unlawfully pushed MRED to do so. 

MRED argues that if Zillow is permitted to filter out certain listings while still relying on an MLS feed, it would open the door for any brokerage to curate competitors’ listings or adjust visibility to match its own marketing strategies. That, MRED says, could erode the comprehensive, cooperative marketplace that consumers and agents expect from MLS-powered search experiences.

“If Zillow can receive an MLS feed and arbitrarily exclude certain listings, what prevents every brokerage from doing the same?” the post asks. MRED frames its role as a market “referee” responsible for defending fair broker cooperation and enforcing the IDX agreement that participating brokers sign.

The MLS further warns that if the foundation of consistent listing display and cooperation unravels, the industry could again attract the kind of antitrust scrutiny the DOJ applied in the mid-2000s. The post explicitly suggests that “history may be trying to repeat itself” if a court allows a single brokerage’s website strategy to dictate which MLS listings are shown, potentially to the detriment of sellers whose listing agents chose different marketing paths, such as private or limited-public marketing options.

In an emailed statement a Zillow spokesperson told HousingWire that the comapny’s listing access standards policy applies “objectively and equally to every listing, regardless of brokerage.”

“A neutral referee doesn’t change its display rules to accommodate one brokerage’s private listing model, then cut off the feed of another platform that stands up for consumer transparency,” the spokesperson added. “That’s picking sides. It’s telling that the only MLS taking this position is the one that announced a nationwide expansion in partnership with the brokerage whose private listing network it’s trying to protect.”

MRED CEO Rebecca Jensen previously vocalized these concerns regarding the 2008 settlement during a two-day hearing in early July regarding Zillow’s motion for a preliminary injunction that would prevent MRED from suspending its listing data feed. A ruling has not yet been issued on this motion. 

During her testimony, Jensen described a call between herself and Zillow’s chief industry development officer Errol Samuelson. According to Jensen, during the call the Zillow executive asked if she would consider having MRED’s private listings delayed on Zillow, which she declined citing the 2008 settlement. 

On the stand, Jensen explained her strong desire to not acquiesce to Zillow’s request came from her experience in the real estate industry dealing with the DOJ lawsuit that resulted in the 2008 settlement, and if faced with potentially contending with a lawsuit from the DOJ or Zillow, she would rather deal with Zillow. Jensen also testified that the “objective criteria” defined in MRED’s IDX display rule, which is the policy at the center of this lawsuit, are a result of the 2008 settlement. 

This article was written by Brooklee Han and generated with the assistance of HousingWire Automation, then reviewed by a HousingWire editor before publication.