The Seattle-based MLS argued that a ruling in a case involving Zillow has parallels to its own legal battle against Compass.
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Northwest Multiple Listing Service is keeping an eye on Compass’s outstanding litigation and seeking to use it to its advantage in the MLS’s own case against the country’s largest brokerage.
In early February, Judge Jeannette Vargas of the Southern District of New York denied Compass’s request to halt Zillow’s Listing Access Standards rule. The rule bans listings from the portal if they are marketed publicly but not made available to Zillow within one day.
The judge said at that time that Compass had not shown a likelihood to succeed in the case, but allowed litigation to continue. She also noted that Compass is free to continue using its 3-Phased Marketing Strategy (3PM), whereby Compass agents start marketing listings off the MLS, then move them to coming-soon status and ultimately put them on the MLS, but would in turn forfeit having those listings up on Zillow.
NWMLS flagged Judge Vargas’s ruling in the matter in February and asked that it be allowed to explain the ruling’s relevance to NWMLS’s motion to dismiss its case with Compass. The brokerage first sued NWMLS last April, calling the multiple listing service a “monopolist.”
Now, the MLS has again urged the court to consider the ruling in a new reply to a response on the motion from Compass.
“The [Southern District Court of New York’s] Order offers many direct parallels relevant to the Court’s consideration of NWMLS’s pending motion to dismiss, particularly with respect to the SDNY’s finding of a nationwide relevant market, and its analysis of the importance of the buy-side market for Compass’ business, and its antitrust impact,” NWMLS’s reply states.
“Compass tries to downplay the relevance of Compass v. Zillow on procedural grounds,” the reply continues, adding that the court’s order “is not specific to the procedural posture of the case.”
Representatives for Compass and NWMLS did not immediately respond to Inman’s request for comment.
Compass has not yet responded in court. But the brokerage did respond to NWMLS’s February filing. In that response, Compass argued that the similarities NWMLS was trying to draw between the cases were “false parallels.” The brokerage also argued that the claims at the center of the Zillow case were “fundamentally different” to those brought up in the NWMLS case, and therefore parallels could not be drawn between them.
Compass ultimately concluded that the ruling in the case with Zillow “has no persuasive value” in the lawsuit against NWMLS.
NWMLS’s reply, however, argues the opposite.
“Tellingly, Compass’s response engaged in full on the substance of the SDNY Order, but failed to provide any compelling reason this Court should ignore the SDNY’s comprehensively reasoned decision to deny Compass’s motion for an injunction,” NWMLS said.
NWMLS also argued that the order in the Zillow case supports its claims that Compass failed to demonstrate that the multiple listing service was harming both sides of the market.
“Compass’s Complaint conspicuously omits references to buyers, alleging only that NWMLS’s enforcement of its Rules harms sellers participating in Compass’s 3PM program,” NWMLS said. “The procompetitive justifications for NWMLS Rules supporting buyers and preventing free-riding must, however, also be weighed — even at the motion to dismiss stage.”
NWMLS’s filing goes on to state that the order in the Zillow case “confirms the importance of buyers and the buy-side of the real estate brokerage.”
Email Lillian Dickerson
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