Oregon’s attorney general has joined other states, the District of Columbia and the federal government in an antitrust lawsuit against a company that sells property management software that provides rental price recommendations.
The lawsuit against Texas-based RealPage accuses the company of collecting confidential rental data from more than 16 million units across the country to develop software that allows landlords to coordinate their prices rather than compete with each other. RealPage was said to have a monopoly on rental management software, controlling at least 80% of the market.
“Its dominant market position is protected by significant data advantages that it gains from its vast reservoir of unlawfully obtained competitive information from competing landlords,” the lawsuit states. “RealPage replaces competition with coordination. It replaces rivalry with unity. It undermines competition and the competitive process. It does so openly and directly – and American renters are paying the price.”
Submitted on Friday The lawsuit in U.S. District Court in North Carolina comes at a time when rents are soaring in Oregon, particularly in the Portland area. Under normal market conditions, renters would benefit from competition among landlords, who would limit rent increases during boom times and lower rents during recessions to make housing more affordable, the lawsuit says. But it says RealPage’s software inhibits competition, which Oregon Attorney General Ellen Rosenblum says violates the law.
“RealPage’s use of its AI pricing algorithm effectively acts as a hub for property managers and landlords to share confidential, competitively sensitive information and engage in a price-matching scheme to avoid competition,” Rosenblum said in a statement. “It undermines a fair rental market and is a violation of Oregon and federal antitrust laws (the Sherman Act).”
Jennifer Bowcock, a spokeswoman for RealPage, said in a statement that the company would defend itself “vigorously” against the allegations. She said the revenue management software is designed to be “compliant with the law.” In addition, the company has worked “constructively” with the Ministry of Justice for years. In 2017, the authority examined the company’s software and found nothing objectionable.
“We believe the Justice Department’s demands are unfounded and will do nothing to make housing more affordable,” Bowcock said.
The lawsuit names areas in 24 states — Arizona, Alabama, Arkansas, California, Colorado, Connecticut, Florida, Georgia, Kansas, Ohio, Maryland, Massachusetts, Mississippi, Missouri, Nevada, New Hampshire, North Carolina, Oregon, South Carolina, Tennessee, Texas, Utah, Virginia and Washington — where at least 30% of property managers use RealPage’s software. In Oregon, that’s 54,000 units in the Aloha-Beaverton area and downtown Portland, where a one-bedroom, one-bath unit can cost more than $2,200 a month.
“Americans should not have to pay more rent just because a company found a new way to work with landlords and break the law,” U.S. Attorney General Merrick Garland said in a statement.
Rosenblum added that the housing situation in Oregon is a major problem, as rents there have risen sharply in recent years.
“At a time when housing affordability is a paramount concern for Oregonians – and for countless Americans outside our state’s borders – the issues of fairness and competition couldn’t be more important,” she said.
In addition to Oregon, the attorneys general of California, Colorado, Connecticut, Minnesota, North Carolina, Tennessee and Washington joined the lawsuit.
The US Department of Justice – together with Oregon and other states – has also filed antitrust lawsuits against Amazonand Meta, the owner of Facebook. In December Google agreed to pay $700 million to settle an antitrust case related to the Play Store, and in March the U.S. Department of Justice, Oregon and other states sued Appleand also claimed that monopolistic behavior was intended to curb competition.
Get the morning’s headlines straight to your inbox
