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The Justice Department has expanded its lawsuit against the RealPage company to include six of the nation’s largest real estate agents.
The department sued RealPage in August, alleging that the company’s algorithms used unknown information from competing landlords to encourage rent increases that caused housing to soar across the country. Now, the prosecutors and the government are to blame six companies participating in the scheme.
“While Americans across the country have struggled to find housing, the landlords named in today’s indictment shared information about rental rates and used collusive tactics to drive up rent,” said DOJ Assistant Attorney General Doha Mekki in a statement. his words. “Today’s action against RealPage and six major landlords are seeking to end their for-profit practice and make housing affordable for millions of people across the country.”
The companies added to the suit are Greystar Real Estate Partners LLC LivCor LLC of Blackstone; Camden Property Trust; Willow Bridge Property Company; Cortland Management LLC; and Cushman & Wakefield Inc. and Pinnacle Property Management Services LLC, who are joint owners. Together, the companies operate more than 1.3 million units in 43 states, the DOJ said.
Cortland Management, which manages 80,000 rental units, has already agreed to an injunction that would prevent them from using competitor information to manipulate all types of pricing and from using third-party pricing strategies without the supervision of a court-appointed appraiser.
The amended complaint vs. RealPage and landlords report that landlords have directly shared their pricing plans and settings within RealPage’s YieldStar program. For example, in September 2020, Camden’s cash management manager reportedly spoke with the director of Greystar’s management team to discuss how they plan to track prices in the coming quarter.
“The Geystar manager also disclosed his practice of approving YieldStar prices and using concessions,” according to the lawsuit. “As the discussion progressed, the contestants shared more information about occupancy — including in specific markets — what they wanted, and how to use it wisely.”
The DOJ also alleges that landlords participated in “user groups” hosted by RealPage where they discussed how to change their pricing algorithms and their rental strategies. The complaint includes numerous stories from user groups in which landlords allegedly shared inappropriate information with competitors and RealPage employees allegedly told landlords to “upgrade new prices and updates” and to “trust the science” of RealPage’s algorithms. .
The DOJ was joined in the suit by attorneys general from 10 states.
