Zillow filed a lawsuit against Arizona two multiple listing services (MLSs), citing antitrust injury to it and its brand ShowingTime.
The real estate company alleged Arizona Regional Multiple Listing Service and Metro Multiple Listing Service originally agreed to integrate ShowingTime, Zillow’s service to facilitate homebuyer tours, into their membership portals. Member portals are how listing agents and buyers communicate about property showings and tours. These portals also provide ancillary services like management programs to help coordinate the appointments inherent to selling a home (buyers, appraisers, inspectors, etc).
In 2021, these two MLSs joined with others to create MLS Aligned. MLS Aligned then acquired another showing management platform that was re-branded and further developed into Aligned Showings. Aligned Showing was initially offered as an option alongside ShowingTime, but “defendants conspired to use various tactics to steer their members to Aligned Showings, including by making Aligned Showings the default showing service, positioning Aligned Showings as a means of moving away from a competing product affiliated with Zillow (which some MLSs and agents view as a threat to their traditional business model), falsely disparaging ShowingTime in their instructional videos and materials, and warning agents that ShowingTime would eventually be taken away.”
Zillow alleged that when agents did not switch over to the new showing service, the MLSs conspired to create a monopoly in their region for Aligned Showings.
“In coordinated fashion,” the members of MLS Aligned began to remove integration for the ShowingTime platform from their member portals, leaving Aligned Showings as the only “practical” choice available to agents using these portals.
“The availability of ShowingTime as an integrated scheduling option on the MLS member portal is critical to ShowingTime’s efficiency and functionality, as agents primarily access ShowingTime through the MLS member portal,” the complaint stated. “If ShowingTime is not available as an integrated option on the MLS member portal for listing agents to select when listing a home, most listing agents will choose another option that is integrated (even if it is otherwise inferior) and will not choose ShowingTime.
“By making Aligned Showings the only integrated option on the MLS member portal, the MLS defendants are substantially foreclosing ShowingTime from their markets and giving Aligned Showings a monopoly over showing management platforms in their respective regions.”
Should the MLSs succeed, Zillow alleged there will be no competition to inspire improvements to their product, and defendants would be able to raise the price of Aligned Showings and its premium options. Moreover, because ShowingTime’s services are more accessible to consumers through platforms like Zillow and Redfin, by restricting its availability, the MLSs are harming consumers, these consumer-oriented platforms, and agents that work with said platforms.
The complaint stated Zillow is seeking to restore a level playing field and to “be given a fair opportunity to compete on the merits with defendants’ showing management platform.”