The U.S. Department of Justice filed a civil lawsuit against RealPage Inc. on Friday, alleging that the AI software platform provider’s algorithm enabled landlords across the country to set rental prices.
U.S. Department of Justice officials say Texas-based RealPage has contributed to sharp rent increases since the pandemic because its software allows landlords to collude to drive up prices and avoid competition, violating antitrust laws.
“Americans should not have to pay more rent just because a corporation found a new way to work with landlords to break the law,” Attorney General Merrick Garland said Friday during a press conference.
The Justice Department alleges that RealPage’s software recommends rental prices based on its data collection and allows property owners to share confidential private information to help set prices – a type of collusion between landlords.
In a statement, RealPage criticized the Justice Department’s request as “meritless,” the Associated Press reported.
“We are disappointed that after many years of education and cooperation on the antitrust issues surrounding RealPage, the Department of Justice has chosen this moment to bring a lawsuit that seeks to scapegoat pro-competitive technology that has been used responsibly for years,” the company said in the statement provided to AP.
In a statement posted on RealPage’s website in June, the company responded to its critics by saying the real issue is housing affordability.
“Now is the time to clarify a number of false claims about RealPage’s revenue management software and the way rental housing providers set rent prices,” Dana Jones, CEO and president of RealPage, said at the time. “Housing affordability should be the real focus. RealPage is proud of the role our customers play in providing safe and affordable housing for millions of people. Despite the noise, we will continue to innovate with confidence and ensure our solutions continue to benefit both residents and housing providers.”
Eight states have joined the Justice Department in filing suit against RealPage: California, Colorado, Connecticut, Minnesota, North Carolina, Oregon, Tennessee and Washington.
