RealPage’s algorithmic pricing software then uses this data to generate pricing and lease term recommendations, effectively reducing competition.
The Justice Department, along with the Attorneys General from North Carolina, California, Colorado, Connecticut, Minnesota, Oregon, Tennessee, and Washington, has filed a civil antitrust lawsuit against RealPage Inc. The lawsuit, lodged in the U.S. District Court for the Middle District of North Carolina, accuses RealPage of unlawfully reducing competition among landlords in apartment pricing and monopolizing the market for commercial revenue management software.
“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,” said Attorney General Merrick B. Garland. “We allege that RealPage’s pricing algorithm enables landlords to share confidential, competitively sensitive information and align their rents. Using software as the sharing mechanism does not immunize this scheme from Sherman Act liability, and the Justice Department will continue to aggressively enforce the antitrust laws and protect the American people from those who violate them.”
The complaint alleges that RealPage orchestrates a scheme where landlords share sensitive rental information with the company. RealPage’s algorithmic pricing software then uses this data to generate pricing and lease term recommendations, effectively reducing competition. This conduct, the lawsuit claims, harms renters by limiting their choices and driving up costs. The complaint seeks to end RealPage’s practices and restore competitive pricing for renters nationwide.
“Today’s complaint against RealPage illustrates our corporate enforcement strategy in action. We identify the most serious wrongdoers, whether individuals or companies, and focus our full energy on holding them accountable,” said Deputy Attorney General Lisa Monaco. “By feeding sensitive data into a sophisticated algorithm powered by artificial intelligence, RealPage has found a modern way to violate a century-old law through systematic coordination of rental housing prices — undermining competition and fairness for consumers in the process. Training a machine to break the law is still breaking the law. Today’s action makes clear that we will use all our legal tools to ensure accountability for technology-fueled anticompetitive conduct.”
“RealPage’s egregious, anticompetitive conduct allows landlords to undermine fair pricing and limit housing options while stifling necessary competition,” said Acting Associate Attorney General Benjamin C. Mizer. “The Department remains committed to rooting out illegal schemes and practices aimed at empowering corporate interests at the expense of consumers.”
Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division criticized RealPage, stating, “As Americans struggle with housing affordability, RealPage facilitates landlord coordination to raise rents. Today, we filed an antitrust suit to ensure housing remains affordable by promoting competition instead of allowing RealPage to dictate rental prices.”
The complaint includes internal documents and sworn testimony revealing RealPage’s and landlords’ intentions to maximize rental prices and profitability. Highlights include:
- RealPage admitted its software is designed to maximize rental prices, describing its products as driving every opportunity to increase prices and avoiding competition during market downturns.
- A RealPage executive noted that their products help landlords avoid competing on merit, advocating for industry-wide success rather than individual competition.
- Another executive highlighted that using competitor data could lead to larger rent increases.
- A landlord remarked that RealPage’s algorithm, which uses data from other subscribers to suggest rents, resembles classic price fixing.
The complaint alleges that RealPage’s agreements and actions undermine competition in local rental markets for multi-family dwellings nationwide. RealPage reportedly uses data from competing landlords to promote adherence to its algorithm’s recommendations through features like “auto accept” and pricing advisors who monitor compliance. This approach tends to drive up rental prices, reduce price decreases, and enhance landlords’ pricing power. The company is also accused of training landlords to limit concessions and discounts, leading to fewer incentives for renters.
Additionally, the complaint alleges that RealPage has unlawfully maintained its monopoly in the commercial revenue management software market for multi-family dwellings, where it holds about 80% of the market share. By sharing competitively sensitive data, landlords receive pricing recommendations based on a mix of competitors’ data, reinforcing RealPage’s market dominance and hindering fair competition.
RealPage Inc., headquartered in Richardson, Texas, is at the center of this lawsuit.
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