DOJ Sues Software Company RealPage Over Alleged Rent-Fixing Scheme
The US Department of Justice and attorney generals from eight states have filed an antitrust lawsuit against RealPage, a Texas-based property management software provider. The lawsuit, filed on Friday in the Middle District of North Carolina, accuses RealPage of enabling widespread collusion among landlords to artificially inflate rent prices for millions of Americans.
The core allegation is that RealPage’s algorithmic pricing software facilitates a price-fixing scheme by allowing competing landlords to share sensitive rental data. This data is then used to train the company’s algorithms, which generate pricing recommendations for landlords. The DOJ claims this practice replaces genuine market competition with coordinated rent-setting, ultimately harming renters across the US.
Attorney General Merrick Garland emphasized the seriousness of the allegations, stating, “Americans should not have to pay more in rent because a company has found a new way to scheme with landlords to break the law.” The lawsuit asserts that RealPage’s actions violate Sections 1 and 2 of the Sherman Act, a cornerstone of US antitrust law.
The case is notable as one of the DOJ’s first major enforcement actions where software is alleged to be the primary means of collusion. Deputy Attorney General Lisa Monaco highlighted this aspect, warning that “training a machine to break the law is still breaking the law.”
RealPage, however, denies the allegations, claiming that its customers retain full control over their rent prices and can reject the algorithm’s recommendations. The company insists its software is designed to be legally compliant and that it uses data responsibly.
This legal action follows a series of similar lawsuits against RealPage, including those filed by the District of Columbia and Arizona attorneys general. It also comes in the wake of a ProPublica investigation that revealed the significant influence of RealPage’s software on rental pricing.
The lawsuit’s outcome could have far-reaching implications for the use of algorithmic pricing in various industries and may set a precedent for how antitrust laws are applied to technology-facilitated market coordination.
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