REPORT: DOJ Opens Criminal Probe Targeting RealPage, Multiple Landlords
The Department of Justice is reportedly launching a criminal probe into whether the apartment industry engaged in unlawful collusion to drive up rents as troubles snowball for some of the nation's biggest landlords and the software firm they rely on.
The DOJ opened a civil investigation into RealPage’s price-setting algorithm in 2022, but unnamed sources told Politico that has now escalated into a criminal inquiry.
The move follows the Biden administration’s stated effort to end anticompetitive schemes in the rental market.
“For millions of renters, we’re cracking down on big landlords who break antitrust laws by price-fixing and driving up rents,” President Joe Biden said during his State of the Union address earlier this month.
More than 30 lawsuits accusing RealPage of colluding with some of the nation’s biggest landlords to inflate rents beyond competitive levels were consolidated into one massive class-action suit last spring. That case is ongoing.
Though not a plaintiff, the DOJ has argued against dismissing antitrust lawsuits against RealPage and others. Yardi Systems and multiple landlords in the Western District of Washington are subjects of a similar case, and the DOJ asked a judge to hold firm on that litigation too.
“Put simply, RealPage allegedly replaces independent competitive decisionmaking on prices, which often leads to lower prices for tenants, with a price-fixing combination that violates Section 1 of the Sherman Act,” the DOJ wrote in the brief supporting the class action suit against RealPage.
The Texas-based firm has thus far denied any wrongdoing, per Politico. It is also the subject of investigations by attorneys general in North Carolina, Washington D.C. and Arizona.
