Seattle-based MLS argued that the ruling in the case involving Zillow is similar to its own legal battle against Compass.
The Northwest Multiple Listing Service is keeping an eye on Compass’ pending lawsuit and hopes to use it to its advantage in the MLS’s own lawsuit against the nation’s largest brokerage firm.
In early February, Judge Janet Vargas of the Southern District of New York denied Compass’ request to suspend Zillow’s listing access standards rules. The rules prohibit listings from the portal if they are publicly available for sale but are not made available to Zillow within one day.
The judge said at the time that there was no indication that Compass had a chance of success in the case, but allowed it to continue. He also noted that Compass is free to continue using its three-phase marketing strategy (3PM). This allows Compass agents to start marketing their listings from the MLS, then move them to Coming Soon status, and ultimately get them listed on the MLS, but as a result, they abandon their listings on Zillow.
In February, NWMLS took note of Judge Vargas’ ruling on this issue and asked that he be allowed to explain its relevance to NWMLS’ motion to dismiss the case against Compass. The brokerage first sued NWMLS last April, calling the multiple listing service a “monopoly.”
Now, in a new response to the complaint filed by Compass, MLS once again asked the court to consider the decision.
” [Southern District Court of New York’s] “This order presents a number of direct parallels relevant to the court’s consideration of NWMLS’s pending motion to dismiss, particularly with respect to SDNY’s findings of relevant markets nationally and SDNY’s analysis of the importance of the buy-side market to Compass’ business and its antitrust implications,” NWMLS’ response states.
“Compass seeks to downplay the relevance of Compass v. Giroux for procedural reasons,” the response continued, adding that the court’s order “is not specific to the procedural stance of the case.”
Representatives for Compass and NWMLS did not immediately respond to Inman’s requests for comment.
Compass has not yet responded in court. However, the brokerage responded to NWMLS’s February application. In its response, Compass argued that the parallels NWMLS was trying to draw between the incidents were “false parallels.” The intermediaries also argued that the claims at the heart of the Zillow lawsuit are “fundamentally different” from the claims raised in the NWMLS lawsuit, so no similarities can be drawn between them.
Compass ultimately concluded that the ruling in the Zillow case against NWMLS was “not persuasive.”
However, the NWMLS response claims the opposite.
“Clearly, Compass’s response fully addressed the substance of the SDNY order, but it failed to provide any compelling reason why this court should ignore SDNY’s comprehensively reasonable decision to deny Compass’s motion for an injunction,” NWMLS said.
NWMLS also argued that the order in the Zillow case supports its claim that Compass has failed to prove that its multi-listing service harms both sides of the market.
“Compass’s complaint noticeably omits any reference to buyers, alleging only that NWMLS’ enforcement of the rules harms sellers participating in Compass’ 3PM program,” NWMLS said. “However, the pro-competitive rationale of the NWMLS rules to assist buyers and discourage free riding must also be considered, even at the motion to dismiss stage.”
The NWMLS filing goes on to say that the order in Zillow “affirms the importance of the buyer side of buyers and real estate agents.”
Email Lillian Dickerson
