RealPage, a software company recently sued by the U.S. Department of Justice (DOJ), defended its practices against collusion allegations on Monday, arguing that it operates within legal boundaries and does not harm competition. The Justice Department, along with attorneys general from eight states, filed a lawsuit in federal court in North Carolina last Friday, accusing RealPage of facilitating rent increases by helping landlords share confidential information.
According to USA Today, Stephen Weissman, an outside attorney representing RealPage, responded to the lawsuit by denying claims that the company’s practices are anti-competitive. Weissman argued that the Justice Department misrepresented the situation by cherry-picking quotes from company executives and taking them out of context to support its case. He emphasized that RealPage’s software aggregates rental data from various sources rather than providing concrete prices from competing properties, which he said ensures the legality of its operations.
Read more: Antitrust lawsuit against RealPage could be legal test for AI-driven collusion
According to USA Today, the lawsuit alleges that RealPage’s software, used by landlords managing roughly 16 million rental units across the U.S., particularly in the Sun Belt and the South, allowed landlords to share nonpublic information about rents, vacancies and concessions. The Justice Department argues that this information sharing stifles competition and leads to higher rents for tenants. The lawsuit further alleges that RealPage controls roughly 80% of the market for “revenue management software” for landlords, giving it a monopoly position that it allegedly uses to help landlords collude to keep rental prices high.
Weissman, who was formerly deputy director of the Federal Trade Commission’s Bureau of Competition, claimed that the software does not drive up prices beyond what would happen in a competitive market. He claimed that the rents landlords ultimately charge are always equal to or lower than advertised prices, meaning the software does not cause rent increases.
The Justice Department’s lawsuit is complex and could result in lengthy litigation, according to Weissman. However, RealPage has expressed a willingness to engage in discussions with the government to more quickly address its concerns. “We want to comply with the law,” Weissman explained. “We firmly believe in the legality of our product, but if there are solutions here that allow us to continue to innovate and be competitive in the marketplace, we are open to those solutions.”
The states involved in the lawsuit against RealPage include California, Colorado, Connecticut, Minnesota, North Carolina, Oregon, Tennessee and Washington. Attorney General Merrick Garland emphasized the importance of the case, saying, “Americans should not have to pay more rent just because a company found a new way to collude with landlords and break the law.”
Source: USA Today
