Zillow scores victory in REX case ahead of trial 

A U.S. district judge has ruled a key charge in a court case against Zillow and the National Association of Realtors is without merit, significantly downgrading the case about how portals display non-MLS real estate listings.

On Aug. 16, U.S. District Judge Thomas Zilly ruled that REX Homes' antitrust claim was without merit, effectively removing NAR as a party to the case. 

The Real Estate Exchange, known as REX, is suing Zillow and NAR over what it says were deceptive practices to conceal non-MLS listings on Zillow's heavily trafficked website. REX was a low-commission brokerage that ceased operations in May 2022.

The case, which will be heard in the U.S. District Court in Seattle, is scheduled to go to trial on Sept. 18. The case will continue to involve REX's claims that include unfair/deceptive trade practices and a defamation claim.

The case was filed in March 2021, and in the original complaint, REX claims its business was damaged when non-MLS listings on Zillow were relegated to a secondary search results tab, limiting traffic to those listings.

Zillow had modified its site in January 2021 after it began using the Internet Data Exchange (IDX) feed that handles MLS listings. Zillow said it made the change in order to comply with NAR guidelines, specifically its  no co-mingling policy.

The ruling about the antitrust claim is a significant victory for Zillow, said Will Lemke, corporate communications manager for the company. 

"The court agreed REX's antitrust claim was without merit and lacked any evidence to back it up," Lemke said. "This ruling affirms Zillow's business decisions were squarely focused on improving the data on our website for consumers. With REX's central argument tossed from this case, we believe the public now sees this case for what it is: REX seized upon another company's website design change to hide its own business failings."

NAR is also pleased about the outcome, said Mantill Williams, NAR's vice president of communications.

"NAR guidelines acknowledge that each real estate market is different, allowing for independent multiple listing services (MLSs) to choose whether their listings are displayed with listings from other data sources," Williams said. "Local MLSs benefit competition and fair housing, and provide consumers with the most accurate, transparent, and up-to-date information on home listings."

Real Estate News has also reached out to the attorney representing REX for further comment.

In the ruling, Zilly said "REX has presented the court with no legal analysis of an antitrust claim involving only Zillow and individual MLSs, and has failed to identify which specific MLSs are involved in the alleged conspiracies."

Zilly noted Northwest MLS as an example. NWMLS is not affiliated with NAR but also has a no-commingling rule.