The Justice Department has taken legal action against RealPage Inc., a real estate software company, by filing an antitrust lawsuit. The lawsuit, accompanied by attorneys general from various states such as North Carolina and California, accuses RealPage of engaging in an illegal scheme that enables landlords to coordinate rent increases.
The lawsuit claims that RealPage violated antitrust laws through its algorithm, which landlords utilize to determine recommended rental prices for their properties. This algorithm allegedly facilitates landlords in aligning their rental prices to avoid healthy competition that would typically result in lower rents. Justice Department officials referenced a RealPage executive who reportedly stated that it is more beneficial for everyone to succeed together rather than compete, as competition can negatively impact the entire industry.
Attorney General Merrick Garland emphasized that Americans should not be subjected to paying higher rent due to a company collaborating with landlords to unlawfully raise prices. A number of states’ attorneys general have also sued RealPage separately, alleging an illegal price-fixing scheme related to the company’s algorithmic pricing software.
RealPage, in a statement on its website from June, refuted the claims brought against it as “false and misleading.” The company argued that its software actually improves the rental housing ecosystem by offering recommendations, which landlords ultimately have the freedom to accept or reject when setting their rental prices.
This legal action against RealPage is in line with the Biden administration’s enhanced efforts to enforce antitrust regulations. Earlier this year, the Justice Department filed lawsuits against Apple and Ticketmaster, owned by Live Nation Entertainment, as part of its broader crackdown on antitrust violations. Furthermore, investigations have been initiated into the activities of tech companies such as Microsoft, Nvidia, and OpenAI concerning their roles in the artificial intelligence industry.