The Justice Department has expanded its lawsuit against real estate software company RealPage to include six of the nation's largest homeowners.
The department sued RealPage in August. It alleges that the company's algorithms pull non-public data from competing homeowners. to introduce rent increases that are driving up housing costs across the country; Federal and state prosecutors are now charge Six real estate companies are participating in this project.
“As Americans across the country struggle to afford housing, Landlords named in today's lawsuit shared sensitive information about rental prices. and use coordinated algorithms to keep rental prices high,” DOJ Acting Assistant Attorney General Doha Mekki said in a statement. “Today's action against RealPage and six major landlords seeks to end the practice of putting profit over people. and make housing more affordable for millions of people across the country.”
Companies added to the lawsuit include Greystar Real Estate Partners LLC; Blackstone's LivCor LLC; Camden Property Trust; Willow Bridge Property Company; Cortland Management LLC; and co-owners Cushman & Wakefield Inc. and Pinnacle Property Management Services LLC. Collectively, the companies operate more than 1.3 million units in 43 states, the DOJ said.
Cortland Management, which manages 80,000 rental units, has agreed to issue a consent order prohibiting it from using sensitive competitor information to drive any pricing models and from using its pricing algorithms. third parties without the supervision of a court-appointed investigator
at Resolve a complaint Against RealPage and landlords, they allege that property owners directly shared information about pricing plans and settings within RealPage's YieldStar software with each other. For example, in September 2020 Camden's director of revenue management allegedly spoke with Director of Greystar's revenue management team to discuss how they plan to approach pricing in the coming quarter.
“Geystar's directors further disclosed their practices in accepting YieldStar rates and using concessions,” according to the lawsuit, “as discussions continued. The two competitors shared additional highly sensitive information about occupancy demand. Including needs in specific markets and strategic use of concessions”
The DOJ also accused the homeowner of engaging in They hosted a “user panel” hosted by RealPage, during which they discussed how to modify the algorithm's pricing methods as well as their own rental strategies. The complaint includes anecdotes from these user group sessions. The homeowner is accused of sharing non-public information with a competitor, and a RealPage employee is accused of telling the homeowner to “Drive new and renewed prices” and “Trust the science” of RealPage's algorithms.
DOJ has been joined in the lawsuit by attorneys general from 10 states.