Just one day after the Federal Trade Commission sued Zillow and Redfin over an agreement it called anticompetitive, a group of state attorneys general piled on with their own lawsuit.
Attorneys general representing Virginia, Arizona, New York, Washington and Connecticut sued Zillow and Redfin in the U.S. District Court for Eastern Virginia on Wednesday.
“On February 6, 2025, Zillow and Redfin executed an unlawful agreement to remove competition from this already highly concentrated market, starting with a $100 million payment to Redfin to exit the ILS advertising market,” the attorneys general wrote.
The group is asking the court for an injunction stopping the agreement, and for other, unspecified relief.
The agreement involved Redfin hosting Zillow’s rental listings in buildings with more than 25 units, as Zillow turned its focus to apartment rentals as a space for revenue growth. The company also struck a similar deal with Realtor.com early last year.
“The practical outcome of the agreement is obvious: Redfin has terminated its existing multifamily advertising business operations and, for the duration of the agreement, has stopped competing to provide ILS advertising for multifamily properties,” the AGs wrote in their suit. “The wholesale elimination of critical competition in this highly concentrated space will harm rental advertisers and the Americans who rely on ILSs to find their next home.”
Zillow, Redfin and CoStar were the largest three rental platforms when the deal was announced in February, according to the FTC and attorneys general lawsuits.
Both lawsuits said that Redfin had been growing its rental platform when the deal was struck. Instead, it has all but shut down the program and terminated the staff who had been growing it.
The agreement also includes Zillow paying Redfin an unspecified amount for leads. It will run for at least nine years unless terminated after the first five years.
In response to the latest lawsuit — the fifth significant lawsuit filed against Zillow since June — Zillow defended the agreement in a statement it also shared in light of the FTC lawsuit.
“Our listing syndication with Redfin benefits both renters and property managers and has expanded renters’ access to multifamily listings across multiple platforms,” a Zillow spokesperson said. “It is pro-competitive and pro-consumer by connecting property managers to more high-intent renters so they can fill their vacancies and more renters can get home. We remain confident in this partnership and the enhanced value it has delivered and will continue to deliver to consumers.”
Much of the lawsuit is similar in substance to the one filed by the FTC on Tuesday, including portions that were redacted.
Each of the five attorneys general that filed the lawsuit on Wednesday is a Democrat. Virginia Attorney General Jason Miyares’ office is leading the suit.
“This agreement between Zillow and Redfin not to compete is illegal,” Miyares said in a statement. “Zillow paying Redfin to exit the market harms renters and property owners by taking away free market incentives to provide high-quality services that businesses and consumers rely on. My Office is suing to protect Virginians from this anticompetitive conduct.”
Both Zillow and Redfin are headquartered in Seattle.
“Amid a housing crisis in Washington, ensuring robust competition in rental advertising is vital,” Washington Attorney General Nick Brown said. “Enforcing our antitrust laws to keep the marketplace fair, protect consumers, and prevent companies from building monopolies is a priority for our office.”
