CoStar Sued By Rival Over Employee's Alleged Trade Secret Theft
CoStar Group is being sued by the owner of Realtor.com, which alleges one of its former employees "spied" on it after leaving to work for CoStar.
The complaint, filed in federal court in California by Move Inc., claims the recently hired editor of Homes.com stole confidential information and accessed Move's computer systems dozens of times up to June.
“There is nothing wrong with lawful – even intense – competition,” Move's lawsuit says. “But competitors should never be allowed to cheat and steal to get ahead.”
Reuters first reported the filing.
James Kaminsky worked for Realtor.com as an editorial director, managing a team of writers from June 2015 through January 2024 before being laid off, according to the complaint. He then joined CoStar as an editor for Homes.com in March.
The lawsuit says “CoStar is desperate to boost traffic to Homes.com,” the competitor of Realtor.com. Kaminsky allegedly accessed documents that showed Move's internal budgeting, industry contact lists and publishing schedule “to help CoStar unlawfully jumpstart the creation of a ‘monetization engine.’”
CoStar CEO Andy Florance said on an earnings call in February that the company plans to spend $1B this year in a marketing push to boost traffic to Homes.com and Apartments.com — including three Super Bowl commercials for Homes.com.
CoStar General Counsel Gene Boxer said in a statement to Bisnow that the Move lawsuit is a “desperate attempt” to distract from the success of Homes.com.
“The employee in question is a mid-level manager who writes and edits stories about condos. Safe to say he has zero input into Homes.com's strategy. And even Move's creative writing exercise doesn't pretend that CoStar itself engaged in any misconduct,” Boxer said in the statement. “We look forward to prevailing in court.”
Before his departure as head of news and insights of Realtor.com, Kaminsky allegedly forwarded dozens of emails containing company information to himself, then deleted nearly a thousand files and his browser history from his work laptop before returning it to the company, the lawsuit says.
Move claims that Kaminsky used his work email address to grant access to his personal account and internal logs show that he accessed Move’s documents at least 37 times until he was discovered last month.
“We don’t comment on pending litigation,” a Realtor.com spokesperson said. “The court documents speak for themselves.”
CoStar was in talks to acquire Move for roughly $3B last year before Move's parent company, News Corp, put an end to discussions. The relentlessly acquisitive company has a deal in place to buy virtual touring company Matterport for $1.6B after it bought Homes.com in 2021 for $156M and Homesnap in 2020 for $250M.
It is also no stranger to lawsuits involving alleged theft of trade secrets. It sued the founder of Homesnap in October, claiming he stole proprietary information from CoStar after he left the Washington, D.C.-based company.
