"Officials from New York, Arizona, Connecticut, Washington and Virginia jointly filed the lawsuit Wednesday, citing a February deal between the two companies in which Zillow "paid Redfin $100 million to shut down its apartment rental advertising business and transfer its clients to Zillow," New York Attorney General Letitia James' office said in a news release. "This agreement is nothing more than an end run around competition that insulates Zillow from head-to-head competition on the merits with Redfin for customers advertising multifamily buildings," the lawsuit reads."
"It also claims that Redfin fired hundreds of employees and then worked with Zillow to rehire some of them. Zillow, Redfin and CoStar, which owns Apartments.com, are the three largest players in the market and account for 85% of all market revenue, according to James' office. The AGs are seeking an injunction to bar the two companies from allegedly scheming and proposes a possible restructuring of the businesses to maintain competition."
Attorneys general from New York, Arizona, Connecticut, Washington and Virginia sued Zillow and Redfin over a February deal in which Zillow paid Redfin $100 million to shut Redfin's apartment rental advertising business and transfer clients to Zillow. The complaint alleges the transaction removed head-to-head competition, violated federal antitrust laws, and could increase advertising costs while reducing rental options for renters. The suit alleges Redfin fired hundreds of employees and coordinated some rehiring with Zillow. Zillow, Redfin and CoStar together account for roughly 85% of market revenue. The states seek an injunction and potential business restructuring; Redfin disputes the allegations.
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