Zillow and Compass went head-to-head last week in a four-day evidentiary hearing over the portal giant’s listing ban, which is at the center of an antitrust lawsuit Compass filed in June. The hearing will determine whether Zillow’s ban has caused Compass irreparable harm and, if so, whether it should be paused while the lawsuit works its way through the courts.
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Inman obtained more than 800 pages of court transcripts, which include testimony from Zillow CEO Jeremy Wacksman, Zillow CFO Jeremy Hofmann, Zillow Group Chief Industry Development Officer Errol Samuelson, Compass co-founder and CEO Robert Reffkin, Compass SVP of Strategy and Business Operations Ashton Alexander and others.
Here are the highlights from each day of testimony.
Day 1: Sticks and carrots
Compass and Zillow’s attorneys spent the first day of the hearing laying the groundwork for their respective arguments over Zillow’s Listing Access Standard.
Zillow’s legal team defended the ban in its opening statement, saying that it’s in the interest of market transparency for buyers and sellers who benefit from the broad distribution of listings. Meanwhile, Compass’s representation framed the ban as an attack on seller choice and on Compass itself, pointing to exhibits that reveal Zillow’s particular concern about the brokerage’s three-phase marketing strategy.
Compass co-founder and CEO Robert Reffkin, Philadelphia-based Compass team leader Kerry Carr, and Zillow Group Chief Industry Development Officer Errol Samuelson all took the stand, giving roughly eight hours of testimony.
Robert Reffkin
“It’s not called the one-phase marketing strategy. It’s called the private exclusive strategy. It’s the three-phase,” Reffkin said, noting that 94 percent of private exclusives reach full MLS distribution. “You’re supposed to test price, build momentum and demand, and go, just like the builders do, to the third phase. What Zillow wants it to be is the one phase.”
During the hearing, Compass’s counsel focused on an exhibit from December 2024 outlining various strategies Zillow could pursue if the National Association of Realtors altered or repealed its Clear Cooperation Policy. The goal, the exhibits said, was to keep 90 percent of listings on Zillow.
The list of strategies was categorized into “sticks” and “carrots,” with the “sticks” including a listing ban and a product ban at the brokerage level. The “carrots” included offering better leads, throttling listings from friendly brokerages to the top of search results, and other preferential treatment.
The exhibit said the sticks and carrots could be used to “isolate Compass” and other “bad actors” as needed.
Errol Samuelson
Samuelson said the document was the result of a product team brainstorming session on Dec. 15, and that senior leadership team (SLT) executives were aware of the outcomes from that session and offered feedback. The last page of the document lists outcomes from an SLT meeting on Dec. 17, but Samuelson said he was “pretty sure [it] was not an SLT meeting per se.”
However, the document was marked “STRATEGY IS OUTDATED AS OF 12/7/24, TO BE UPDATED ASAP,” as Zillow focused its efforts on shaping the listing ban. “Earnest conversations” about the ban began in January, Samuelson said.
The chief industry development officer said the ban was to protect Zillow’s value proposition and ensure market transparency by preventing “a contagion” of private listing networks.
“… The point here is that consumers come to our site to see homes that are for sale — in other words, listings — and without the listings, we can’t deliver one of the core functions that we offer to consumers,” he said. “… When you have Compass and other brokerages running these PLNs, other large brokerages would feel the need to create their own hidden listing network, private listing network.”
“I think if you look at all of the written documentation that we put on — there’s been a lot of it — we agree, it’s bad for Zillow, but our point is, it is bad for consumers, competition, and the industry,” he added.
Day 2: Creating a ‘win-win’ with Compass
The second day of hearings included testimony from Samuelson, Zillow CEO Jeremy Wacksman, Zillow CFO Jeremy Hofmann and Compass SVP of Strategy and Business Operations Ashton Alexander.
Samuelson, Wacksman, and Hofmann answered questions about Zillow’s business model, whether private listing networks harm homebuyers and homesellers, and the impact of the ban on Compass, of which Samuelson said the portal still displays “tens of thousands” of the brokerage’s listings — a greater share than the roughly 1,100 that have been removed for alleged non-compliance.
Meanwhile, Alexander explained the harm Zillow’s ban has allegedly caused Compass, noting that adoption of its three-phase marketing strategy fell from 40 percent to 20 percent after April 10, the day Zillow announced the ban. Alexander said Compass had talks with Zillow about the ban, and alleged Zillow leaders offered “a continuous drip of new information and clarifications” that made it difficult to understand how to avoid violations.
However, the two biggest takeaways of the day came from Wacksman and Hofmann, who fielded questions about Zillow and Redfin allegedly colluding to “boycott” Compass and about Zillow’s $1.3 billion partnership offer to Compass if it adhered to its Listing Access Standards.
Jeremy Wacksman
Wacksman said he spoke with Redfin CEO Glenn Kelman multiple times about Compass’s push to dismantle NAR’s Clear Cooperation Policy and Zillow’s listing access standards. Wacksman said he spoke briefly with Kelman the day before announcing the ban and noted that the Redfin CEO was “thrilled” with Zillow’s decision— but that did not mean the portal giants were colluding against Compass.
“I don’t recall if he specifically used the word thrilled. He was clearly, from his tone and his words, pleased,” he said. “… Again, he was surprised to learn this, and his immediate reaction was support. And he said he had to go talk to his team and think about it.”
Wacksman said he spoke with Kelman a few more times after the ban announcement, where Kelman pointed out areas of confusion within Zillow’s standards FAQ. “We had worked out that others were confused, so we were happy to clarify,” he said of the update to the FAQ.
Redfin announced its plan to ban listings that didn’t follow CCP guidelines on April 14; however, the Seattle-based firm said it still needed to work out the technical logistics and hadn’t chosen an implementation date. It eventually abandoned the ban after its merger with Rocket Companies.
Meanwhile, Hofmann’s testimony focused on a potential partnership between Zillow and Compass, contingent on the brokerage’s agreement to follow the portal’s Listing Access Standards.
Jeremy Hofmann
Leaders from both companies attended one phone and one in-person meeting, during which Zillow and Compass discussed a tech and lead-generation partnership, similar to what they have with eXp Realty, NextHome and West USA. Hofmann said Zillow offered “revenue uplift” of “$1.3 to $1.6 billion,” but never pinned down a specific number as discussions quickly fell apart.
“We were offering ways in which to work together to grow both of our businesses. So we offered them ideas around them buying more of our Zillow showcase products, of them becoming more prominent users of our, what was called at the time, Flex program,” he said. “And we believed that those two things, plus the ability for them to recruit on the back of being power users of those two programs, would allow them to potentially have revenue uplift.”
“It would also have a revenue uplift for us as well,” he added. “We went into it thinking we wanted to develop a partnership that was a win-win, where Compass could grow, and we could grow.”
Day 3: Does Zillow have market power?
The third day of hearings included testimony from Alexander, Compass President of Brokerage Operations Neda Navab, economist Dr. Debra Aron, Compass Head of Investor Relations Soham Bhonsle and National Economic Research Associates (NERA) President Dr. Lawrence Wu.
Alexander was cross-examined about her statements regarding the alleged harm from the listing ban, with Zillow counsel presenting commentary from Compass’s second-quarter earnings (i.e., April 1 to June 30) that said the brokerage’s “private exclusives have stayed at basically the same level throughout the last number of months.”
Ashton Alexander
Zillow’s counsel also presented emails between Alexander and Zillow leadership, which Reffkin was copied on, stating that Zillow took issue with the “black box” on Compass’s site that showed the number of private exclusives and included a call to action to learn more. They also presented a court declaration that Alexander signed on June 26, confirming that she knew all Compass private exclusives violated Zillow’s standards.
However, Compass leadership continued to tell brokers that private exclusives and the three-phase marketing plan were permitted, as those listings are entered into the MLS as ‘Coming Soon’ — something Compass estimated 60 percent of MLSs allow.
“We have thousands of employees and tens of thousands of agents, so I can’t speak to everything that’s being said in every conversation with our agents,” she said.
Meanwhile, Navab focused on the purpose of Compass’s three-phase marketing program and explained how Zillow’s ban allegedly stripped Compass brokers and clients of a crucial “competitive advantage.”
“The way I think about the private exclusive period is, it is like a focus group. A home is a product to be sold just like any other product,” Navab said. “No company would launch a new product to the market without doing a few focus groups, without getting feedback on how the product is positioned, how it’s priced, to get insight, so that they can have a successful launch.”
Dr. Debra Aron
However, the most important testimony of the day arguably came from Aron and Wu, who were questioned about the merits of Compass’s anticompetitive claim against Zillow.
Aron, a Compass witness, said Zillow has market power, which is “the ability to profitably increase price above a competitive level or reduce quality below a competitive level, or often defined as the ability to simply damage competition.”
Aron said she analyzed direct (i.e., Zillow’s listing ban) and indirect (i.e., measures of market share, like Google search and traffic trends) to determine the portal’s market power, which she said they’re using to harm not only Compass, but consumers, who should have the right to test premarketing phases for their listings.
“Zillow’s standards, the listing access standards at issue in this case, harm competition in the online home search platform market,” she said. “Buyers and sellers of real estate are incurring and would continue to incur irreparable harm between now and the conclusion of a trial in this case if Zillow is permitted to maintain the listing access standards.”
Dr. Lawrence Wu
Meanwhile, Wu, a Zillow witness, said Aron’s analysis failed to account for several market realities, including the “multisided nature” of Zillow’s business, where listing quality is not only key to search, but to the residential, mortgage, and software subscriptions they offer to homebuyers, homesellers, agents, brokers, and mortgage providers.
Wu argued that real estate’s highly local nature means Zillow cannot have national market power, and argued that Zillow has the right to protect its comprehensive listing coverage and maintain platform quality for its users, while preventing the alleged risk of market fragmentation.
Wu said Compass’s claim is about Zillow’s “refusal to deal.” The Federal Trade Commission (FTC) says “refusal to deal” occurs when a business declines to do business with another company, and is a general right legal unless it harms competition — the crux of the preliminary injunction.
“Zillow’s standards affect what listings can appear on Zillow’s website, and they apply on a listing-by-listing basis. What is important to me is to understand what they do not do,” he said. “They do not dictate how sellers can market or premarket their listings. They do not prevent brokerages from offering premarketing, and they do not prevent agents from presenting home sellers with various options on marketing.”
“Compass can still have its website. It can still differentiate itself the way it wants with this inventory, if it wants to do that,” he added. “No other platform, search platform has been excluded from the marketplace.”
Day 4: Who’s getting harmed?
The fourth day of hearings included additional testimony from Wu and closing statements from Compass and Zillow’s legal teams, who had their final chance to convince the court of their positions.
“Irreparable harm is harm that cannot be remedied by money damages and relief at the end of the case, if Compass were to prevail,” Zillow legal counsel Eric P. Tuttle said. “The trick is that it has to be unquantifiable but not speculative. That is like a knife’s edge. It’s a tough needle to thread in most cases.”
Tuttle said Compass failed to prove irreparable harm, with testimony from Reffkin, Alexander and Navab about the brokerage’s scrapped billboard campaign, the decline in the adoption of its three-phase marketing program, and alleged reduced brand value as a result of Zillow’s ban falling flat in the face of a record-breaking Q3 performance and $1.6B Anywhere acquisition.
“Compass hasn’t done it here, and I don’t think it can,” he said. “One way that companies can thread this needle is when their entire viability is threatened. There are lots of cases that say that. If you are going to go out of business, that’s irreparable harm. We clearly don’t have that.”
In their closing statements, Compass’s counsel, Chahira Solh and Kenneth Dintzer, focused on the agents’ and sellers’ choice, saying that Zillow’s ban is about exerting “control” over the market to bolster its bottom line.
“Again, your Honor, what we’ve been focusing on and what Compass keeps talking about is the ability to offer choice where Zillow is really trying to control the market with the Zillow listing access standards,” Solh said.
The last day of transcripts includes feedback from Judge Jeanette Vargas, who asked questions and shared opinions about each party’s argument.
Vargas said she was “skeptical” about Compass’s Zillow-Redfin collusion claim and said “there’s no evidence” that Zillow’s “intent was for brokers or anyone to be sending the listings directly to Zillow and bypassing the MLS.”
Vargas also asked Zillow’s counsel about the portal’s market power, saying it seemed that Zillow understood its ban would quash Compass — or any other brokerage’s — ability to implement a three-phase marketing plan.
“It wasn’t simply saying, we don’t want to carry it. You go ahead. You do you,” she said of her take on the ban. “It was saying, we want this to end as an industry-wide matter. We think the Clear Cooperation Policy needs to continue forward.”
What’s next?
Judge Vargas has given Zillow and Compass until Dec. 5 to file further post-hearing papers setting out findings of fact and conclusions of law. It’s unknown when she’ll issue a decision on the preliminary injunction, with the longest timeline being up to three months.
In the meantime, Zillow and Compass are doubling down on their arguments.
A Zillow spokesperson said Compass has been disingenuous in its mission and messaging, including Reffkin’s post-hearing social media posts, which they say lack crucial “context” and are an attempt “to rewrite the narrative to deflect from their failure to argue the merits of their case.”
“Make no mistake: The Compass hidden listings scheme helps only Compass — while consumers and agents suffer the consequences,” the spokesperson told Inman in an emailed statement. “[Last] week’s court proceedings made it crystal clear that Compass knowingly misled its own agents about Zillow’s listing access standards.”
“Moreover, Compass misled consumers, its investors, and the industry, claiming it was acting in sellers’ best interest when in reality, its aim all along has been to line its own pockets,” they added. “As Americans struggle through a housing affordability crisis, the nation’s largest real estate brokerage promotes a scheme that risks inflating commissions while also hiding supply from buyers who need access to inventory.”
Meanwhile, Compass CEO Robert Reffkin has taken to social media, sharing snippets of the exhibits and other examples of Zillow’s alleged campaign specifically targeting Compass.
“Imagine if the dominant platform in every industry banned anyone from using another platform,” he told Inman in an emailed statement. “If Google banned anyone who advertised anywhere other than Google, and Amazon banned anyone who sold their products on another site. The government would never let that happen. So why should we be okay with allowing Zillow to ban anyone who markets listings off Zillow?”
