What Happened: The Department of Justice and Texas software-maker RealPage announced Monday that they have reached a settlement in a case involving price-fixing allegations in some of the nation’s largest rental markets.
At issue was algorithmic rent-setting software the tech company sold that prosecutors said enabled landlords to compete less and boost prices in apartment buildings in ways that could violate antitrust laws. The proposed settlement, which must now be approved by a judge, said RealPage will stop offering software that uses nonpublic, “competitively sensitive” data shared among landlords to recommend how much to charge tenants, officials said.
Under the agreement, RealPage will stop conducting market surveys to gather such information, and it agreed not to discuss pricing strategies or trends based on nonpublic data at meetings it holds for property managers, officials said. The company also must remove or redesign software features that restrict rent decreases or align pricing among competitors, they said.
A court-appointed monitor will ensure compliance with the settlement, if it is accepted. The company also agreed to cooperate with prosecutors in their lawsuit against property managers that have used its software.
A 2022 ProPublica investigation showed RealPage was helping landlords decide rents in a way that legal experts said could result in cartel-like behavior. The DOJ also sued six big landlords, accusing them of using algorithmic software to work together and raise rents. Some have reached settlements with prosecutors.
What They Said: The Justice Department said in a statement that “the proposed settlement would help restore free market competition in rental markets for millions of American renters.”
“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,” Assistant Attorney General Abigail Slater said.
RealPage said in a statement on its website that the settlement “provides greater certainty for housing providers and technology innovators that revenue management software can be operated confidently and in compliance with the views of federal antitrust enforcers.”
“Through it all, our teams remained focused on serving customers and advancing the technology the industry relies on every day,” said Dirk Wakeham, RealPage’s president and CEO. “We are pleased to have reached this agreement with the DOJ, which brings the clarity and stability we have long sought and allows us to move forward with a continued focus on innovation and the shared goal of better outcomes for both housing providers and renters.”
The settlement did not include admissions of wrongdoing, RealPage said, and does not involve financial penalties.
The company said there would be no disruption to its clients’ operations, saying that the settlement would formalize software modifications that were “already made or planned” and that “all RealPage solutions remain fully available, compliant, and configurable to meet evolving legal requirements.”
Stephen Weissman, an attorney for the company, said RealPage believes its use of data has led to “lower rents,