The U.S. Department of Justice has proposed a settlement with software provider RealPage over rent price-fixing through algorithmic coordination, information sharing, and other anticompetitive practices in rental housing markets across the country, according to a release.
The Justice Department alleged in the suit that RealPage’s revenue-management software has relied on nonpublic, competitively sensitive information shared by landlords to set rental prices.
“Competing companies must make independent pricing decisions, and with the rise of algorithmic and artificial intelligence tools, we will remain at the forefront of vigorous antitrust enforcement,” said Assistant Attorney General Abigail Slater of the Justice Department’s Antitrust Division in the release.
If approved by the U.S. District Court for the Middle District of North Carolina, the proposed consent judgment would require RealPage to:
- Cease having its software use competitors’ nonpublic, competitively sensitive information to determine rental prices in runtime operation;
- Cease using active lease data for purposes of training the models underlying the software, limiting model training to historic or backward-looking nonpublic data that has been aged for at least 12 months;
- Not use models that determine geographic effects narrower than at a state level, which is broader than the markets alleged in the complaint;
- Remove or redesign features that limited price decreases or aligned pricing between competing users of the software;
- Cease conducting market surveys to collect competitively sensitive information;
- Refrain from discussing market analyses or trends based on nonpublic data, or pricing strategies, in RealPage meetings relating to revenue management software;
- Accept a court-appointed monitor to ensure compliance with the terms of the consent judgment; and
- Cooperate in the United States’ lawsuits against property-management companies that have used its software.
RealPage said in a release, “The settlement provides resolution and clarity for RealPage customers and the broader multifamily industry, ensuring the company’s revenue-management solutions remain fully available, legally compliant, and aligned with evolving laws and policies. RealPage has worked collaboratively with the DOJ throughout this process, engaging constructively to reach an outcome that strengthens confidence across the industry.
“This resolution marks an important milestone for RealPage, our customers, and the multifamily industry,” said Dirk Wakeham, RealPage President and chief executive officer, in the release.
“This resolution with the DOJ was necessary to provide certainty and finality for RealPage and its customers to avoid protracted litigation,” said Stephen Weissman, Gibson Dunn Partner and former deputy director for the Federal Trade Commission, in the release.
“While we deny any wrongdoing, we appreciate the constructive engagement by DOJ and its willingness to bless the legality of RealPage’s prior and planned product changes under federal antitrust law through the consent decree,” Weissman said, and added, “There has been a great deal of misinformation about how RealPage’s software works and the value it provides for both housing providers and renters. We believe that RealPage’s historical use of aggregated and anonymized nonpublic data, which include rents that are typically lower than advertised rents, has led to lower rents, less vacancies, and more procompetitive effects.”
There is an upcoming 60-day public comment public period before the U.S. District Court for the Middle District of North Carolina may enter the final judgment upon finding it is in the public interest.
About RealPage, Inc.:
RealPage is a provider of revenue management software and services headquartered in Richardson, Texas.
