Zillow claims CoStar is weaponizing litigation' to reduce competition

"The CoStar companies are Delaware corporations based in Virginia, have an office in Seattle, and have shown no connection with this District. The Zillow Terms of Use, to which CoStar is subject, provide for exclusive venue in Washington. CoStar presumably chose this forum to avoid unfavorable Ninth Circuit law, a tactic that should not be given weight, the letter, filed on Monday, states."

"In the letter, Zillow claims that CoStar has not pleaded that Zillow's alleged infringement was volitional, a foundational requirement of direct copyright infringement. Nor has it plausibly alleged that Zillow had the practical ability to police the copyright status of images uploaded to its websites or that Zillow derived a direct financial benefit from the alleged infringement, as required for its vicarious infringement claim, the letter states."

"In Monday's letter, Zillow claims that the lawsuit is CoStar's latest attempt to weaponize copyright litigation for competitive pressure, consistent with its history of filing suits against industry rivals. A similar claim was made on Tuesday, with Zillow stating that the lawsuit is not about protecting copyright, but instead is about CoStar's effort to use litigation to stifle competition and innovation."

Zillow requests transfer of the case to the U.S. District Court for the Western District of Washington, asserting the suit should have been filed there because Zillow is Seattle-based and most likely witnesses are located around Seattle and the West Coast. Zillow notes CoStar companies are Delaware corporations based in Virginia with a Seattle office and limited ties to this District, and cites the Zillow Terms of Use providing exclusive venue in Washington. Zillow seeks a pre-motion conference on a motion to dismiss, arguing CoStar did not plead volitional conduct required for direct copyright infringement nor plausibly allege practical ability to police images or direct financial benefit needed for vicarious liability. Zillow also alleges CoStar is using litigation to pressure competitors and stifle innovation.

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