Antitrust Law Daily Wrap Up, ANTITRUST—E.D. Va.: Zillow and Redfin denied dismissal of FTC and state antitrust complaints., (May 14, 2026)

By Kenneth H. Ryesky, M.B.A., J.D.

Government authorities brought suit over agreement that "will result in reduced choice, higher prices, and reduced quality for multifamily rental advertising customers and will provide no cognizable procompetitive benefits."

The federal district court in Alexandria, Virginia has denied a joint motion to dismiss lawsuits filed by the FTC and several attorneys general alleging that residential property Internet Listing Services (ISL) providers Zillow and Redfin entered into an anticompetitive agreement. Central to the dispute was an alleged $100 million payment from Zillow, one of the alleged dominant players in the ILS rental listing business, to Redfin, an alleged aggressive competitor, in exchange for Redfin to stop competing for the sale of multifamily rental advertising. In order to state a claim under the applicable “quick look” framework of review, an antitrust plaintiff need only allege facts showing a form of market injury. The court held that the lawsuits met that requirement and that the government entities alleged facts that made plausible their claims under the Sherman Act, Clayton Act, and the FTC Act (FTC v. Zillow Group, Inc., No. 1:25-cv-01638-AJT-WBP (E.D. Va. May 6, 2026)).

Background. Internet Listing Services (ILS) are now used by millions of Americans to find residential rental housing. In 2024, the three leading ILS revenue generators in the highly-concentrated US market were (1) Zillow, Inc., a subsidiary of Zillow Group, Inc. (collectively, Zillow) (2) CoStar Group, Inc. (CoStar); and (3) Redfin Corporation (Redfin), who collectively dominated more than 85 percent of the market.

In February 2025, Zillow and Redfin entered into a “partnership” that centered on a syndication agreement whereby Zillow agreed to syndicate its rental listings on Redfin and to become Redfin’s exclusive multifamily listings provider. Redfin in turn agreed to provide Zillow with “lead” requests for more information about a property for those listings from renters using Redfin. Accordingly, Zillow and Redfin urged that both renters and property managers benefit from the partnership.

On September 30, 2025, the FTC filed an antitrust lawsuit against Zillow and Redfin in the Eastern District of Virginia, alleging violations of the the Sherman Act, the Clayton Act, and the FTC Act. The next day, October 1, 2025, the attorneys general of Arizona, Connecticut, New York, Virginia, and Washington filed a mostly verbatim complaint in the same court, alleging the Sherman Act and Clayton Act counts.

On January 13, 2026, Zillow and Redfin filed a joint motion to dismiss the FTC and state complaints. In their view, Redfin had struggled to grow its rental listings, whereas Zillow had plenty and was striving to provide a better platform for renters with stronger performance for advertisers. Also, he two partners characterized the government complaints as a challenge to collaboration that “makes renters and property managers better off and the rental advertising business more competitive.” They urged their advertising platforms are “two-sided” because they provide more rental listings for renters, and more prospective renters for landlords, making both sides better off. They also argued that even if it were appropriate to ignore the “two-sided” nature of their platforms, the government failed to allege even a one-sided relevant market or market power sufficient to harm competition.

Market definition. The court found that the relevant market definition in the complaints was not defective. Here, while the relevant geographic market was defined as nationwide, provision was made by the government plaintiffs for the existence of more localized sub-markets within that nationwide market.

As for the defendants' contention that the market definition failed "to allege a market encompassing both sides" of an alleged two-sided platform, the court apparently took to heart the government plaintiffs' contention that the defendants were conflating the established rules for a two-sided platform, which intermediates between different groups of buyers and sellers offering different products and services, with a two-sided transaction platform, which entails "a single, simultaneous transaction between participants." The ILS platform here was a two-sided platform, which helps offeror and consumer find one another, but does not necessarily facilitate an immediate simultaneous transaction.

Sufficient market power. The court ruled that the complaints adequately alleged that Zillow and Redfin together wielded sufficient market power to harm competition. Noting that "an observer with even a rudimentary understanding of economics could conclude that the arrangements in question have an anticompetitive effect on customers and markets," the court found that the so-called "quick look" antitrust analysis was the appropriate legal standard for the case. Here, the quick look standard was more than adequately met. The governments' claims were fact-intensive, warranting discovery before the court could issue a ruling on this issue.

The Case is No. 1:25-cv-01638-AJT-WBP.

Judge: Trenga, A.

Attorneys: Allyson M. Maltas for the FTC. Blair Matthews (Cleary Gottlieb Steen & Hamilton LLP) for Zillow Group, Inc.

Companies: Zillow Group, Inc.

Cases: Antitrust FederalTradeCommissionNews VirginiaNews