The Department of Justice, along with the attorneys general of Tennessee, North Carolina, California, Colorado, Connecticut, Minnesota, Oregon and Washington, have formally filed a civil antitrust lawsuit against RealPage Inc., a company founded to provide technology platforms for the rental housing industry.
RealPage Inc. was accused of Sections One and Two of the Sherman Actwhich contain guidelines against conspiracies and monopolies in trade and commerce.
The company’s software is designed to share confidential information about individual apartment rental rates and other lease terms. When landlords agree to share this information, artificial intelligence uses it to train the RealPage algorithm and make price suggestions to other landlords, ultimately driving up rental prices and squeezing out competition in the market.
“Today’s complaint against RealPage illustrates our corporate enforcement strategy in action. We identify the most serious wrongdoers, whether individuals or companies, and focus all of our energy on holding them accountable. By feeding sensitive data into a sophisticated algorithm powered by artificial intelligence, RealPage has found a modern way to violate a centuries-old law by systematically coordinating rental housing prices — and undermining competition and fairness for consumers in the process. Training a machine to break the law is still breaking the law. Today’s action makes clear that we will use all of our legal tools to ensure accountability for technology-enabled anticompetitive behavior,” said Assistant Attorney General Lisa Monaco.
RealPage has confirmed this behavior through internal documents and affidavits from both the company and commercial landlords:
“I’ve always liked this product because your algorithm uses proprietary data from other subscribers to suggest rents and terms. This is classic price fixing…”
“Competition, not RealPage, should determine how much Americans pay to rent their homes,” said Assistant Attorney General Jonathan Kanter of the Justice Department’s Antitrust Division.
For further information on the complaint, please visit the Ministry of Justice’s PDF of the document.
