The Justice Department filed an antitrust lawsuit on Friday against the real estate software company RealPage, saying its software enabled landlords to collude to raise rents across the United States.
The suit, joined by North Carolina, California, Colorado, Connecticut, Minnesota, Oregon, Tennessee and Washington, accuses RealPage of facilitating a price-fixing conspiracy that boosted rents beyond market forces for millions of people. It’s the first major civil antitrust lawsuit where the role of an algorithm in pricing manipulation is central to the case, Justice Department officials said.
“Americans should not have to pay more in rent because a company has found a new way to scheme with landlords to break the law,” Attorney General Merrick Garland said in a statement.
A RealPage spokeswoman, Jennifer Bowcock, said the company would “vigorously” defend itself against the suit and that its revenue management software was “purposely built to be legally compliant.”
The suit escalates the government’s efforts to regulate what it says is misuse of technology. Officials have sued Google, Amazon, Meta and Apple over what they said were monopolistic behaviors that harm consumers.
RealPage’s software, YieldStar, gathers confidential real estate information and is at the heart of the government’s concerns. Landlords, who pay to use the software, share information about rents and occupancy rates that is otherwise confidential. Based on that data, an algorithm generates suggestions for what landlords should charge renters, and those figures are often higher than they would be in a competitive market, according to allegations in the legal complaint.
