A federal judge has granted the National Association of Realtors’ (NAR) motion to dismiss claims the trade association engaged in false advertising or deceptive acts.
However, a real estate technology company’s antitrust lawsuit against NAR and Zillow Group may still move forward.
“The court concludes that plaintiff’s alleged injuries are fairly traceable to NAR’s conduct,” U.S. District Judge Thomas Zilly stated in his recent opinion. “The amended complaint plausibly alleges that Zillow changed its websites because of NAR’s rules.”
The case is REX – Real Estate Exchange, Inc. – v. Zillow, Inc.; Trulia, LLC and The National Association of Realtors (U.S. District Court Western District of Washington at Seattle, No. 21-cv-00312).
REX sued the defendants in March, claiming its competitive mode is threatened by the concerted action of NAR and Seattle-based Zillow, along with their multiple listing services (MLS) affiliates. REX asked a judge to award it treble damages and reasonable attorneys’ fees for alleged violations of the Sherman Antitrust Act and Washington Consumer Protection Act (CPA).
REX claimed Zillow’s decision to join NAR and affiliated MLSs to conceal all non-MLS listings on Zillow’s heavily trafficked websites has led to a dramatic loss of traffic to REX’s listings and higher commissions for NAR members.
REX then filed an amended complaint acknowledging many NAR MLSs did not require Zillow to make changes to its website.
The two defendants recently asked the court to dismiss the amended complaint, alleging REX’s latest theory meant NAR’s rules apply equally to all NAR-affiliated MLSs—and thus did not require MLSs to prohibit commingling, and, by extension, did not require Zillow to make changes to its website.
The court previously concluded Rex has standing to bring its claims against NAR.
REX does not allege NAR made any false statements. Instead, REX is claiming Zillow’s statements are false. The court granted NAR’s motion to dismiss the claims for false advertising or deceptive acts brought under the Lanham Act and the CPA with prejudice.