Lawsuit Claims Zillow’s ‘Premier Agents’ Steal Business from Properties’ Listing Agents

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A proposed class action claims Zillow, Inc. has harmed real estate listing agents by steering prospective homebuyers to its own “premier agents” who, unbeknownst to users, “have no connection to the listed property.” The lawsuit out of New York alleges this practice makes it “improbable” that potential buyers will contact a property’s actual listing agent and much more likely that they will be connected to a Zillow premier agent who will “show them a completely different property they had no desire to see.”

Described in the lawsuit as “the nation’s dominant home buying platform,” Zillow collects monthly fees from premier agents in exchange for listing their profiles next to properties for which they are not the actual listing agent, the suit claims. According to the case, when a prospective buyer attempts to contact an agent through a property listing on the defendant’s platform, Zillow provides the contact information for one of its own premier agents by default. The true listing agent’s profile, the suit says, is obscured or de-emphasized, often appearing “blank, empty and gray” compared to the profiles of Zillow’s premier agents.

The lawsuit argues that Zillow’s platform confuses potential clients as to the identity of a property’s listing agent, noting that it often requires “several scrolls” to find their information among a number of premier agents’ profiles. The case goes on to allege that even when a prospective buyer successfully selects a listing agent’s profile, the buyer’s messages are screened by the defendant’s employees, who then connect the individual to a premier agent and, in many cases, never forward their contact information to the listing agent.

“The overall result of defendant’s web design is that after the prospective homebuyer is screened by defendant’s employees, they will be contacted by Premier Agents,” the complaint reads.

Unfortunately for buyers, premier agents, the lawsuit says, are unable to provide any information about the listed property given their only connection to such is “having paid [the defendant] to be presented prominently next [to] it.” Premier agents, using what the case describes as a “bait and switch” tactic, instead direct homebuyers to different properties that offer a greater financial benefit to the agents, the suit alleges.

“Premier Agents steer the prospective homebuyers to properties that are better financial arrangements for them as opposed to the homebuyers, and attempt to induce, and induce them into signing Buyer’s Agent Agreements or duel agency agreement to egregiously maximize their commission,” according to the complaint.

The effect of Zillow’s design, the case argues, is that premier agents are delivered by the defendant a promised 15 to 20 leads per month that would have otherwise gone to listing agents.

The lawsuit, which echoes a similar suit filed against Trulia earlier this month, seeks to cover all real estate brokers and sales agents in New York, Pennsylvania, and any other state in which Zillow conducts business.

The full complaint can be read below.