C
ompass, a real estate brokerage, has taken its long-standing dispute with home search website Zillow to court. The lawsuit accuses Zillow of engaging in an anticompetitive conspiracy to maintain its dominance over digital home listings.

    At the heart of the issue is a new rule from Zillow that requires any publicly marketed home listing to be published on Zillow within one day or risk being blocked. Compass calls this the "Zillow ban" and claims it's designed to crush competition in the home search space.

    Zillow disputes this characterization, saying its new policy is about fairness and transparency. The company argues that its rule is a response to sales tactics that limit the visibility of home listings, creating a fragmented market and limiting consumer choice.

    Compass' lawsuit comes as the company faces growing pushback from peers in the real estate industry over its "3-phased marketing strategy" for home sellers. This strategy involves private listings before making homes publicly available on all platforms, including Zillow.

    Critics argue that Compass' approach unfairly pushes home sellers to make deals with buyers represented by other Compass agents, resulting in the brokerage collecting a commission from both sides of a sale. Compass denies this and claims many sellers choose its 3-phase marketing route because they don't want their homes displayed on Zillow with negative insights like estimated property values and climate risks.

    Compass also accuses Zillow of conspiring with other players in the industry, including Redfin and eXp Realty, to maintain market dominance. Both companies have agreed to adopt Zillow's new rule, but deny any involvement in a conspiracy.

    The lawsuit marks a significant escalation in the battle between real estate brokerages and home search engines over control of home listings. If Compass succeeds, it could transform how and where real estate listings are shared online.