In a motion filed Friday, Compass requested a preliminary injunction to stop Zillow from enforcing its Listing Access Standards (LAS) while the companies battle it out in court.
The new standards, which ban listings if not entered into the MLS within 24 hours of being publicly marketed, are set to take effect Monday, June 30.
At stake are thousands of Compass listings that could go dark on Zillow, the largest real estate search portal in the U.S., if the company continues using its pre-marketing strategy. Nearly half of Compass listings (48.2%) begin with its 3-Phased Marketing Strategy, which includes a period of private marketing on Compass’ platform before the property is listed on the MLS.
According to Compass, 94% of these listings eventually reach the MLS, and normally, Zillow.
Allegations of Market Interference
Compass argues that Zillow’s new standards would cause “irreversible” damage to the brokerage, reduce consumer choice, and erode trust among clients and agents.
In the declaration, Compass CEO Robert Reffkin wrote:
“Compass will lose business opportunities because of the Zillow LAS.”
The brokerage also claims the policy is already impacting agent retention and recruiting, with at least one top-producing team reportedly leaving the firm over concerns tied to the new rules.
The motion includes allegations that Zillow coordinated with Redfin and eXp to eliminate pre-MLS marketing practices. Redfin has implemented a similar ban, and Compass claims Redfin and eXp agreed to support Zillow’s policy to limit Compass’ competitive advantage.
Zillow’s Stance
For its part, Zillow maintains that hiding listings fragments the market and limits transparency for buyers and sellers. Its LAS policy is aimed at ensuring all listings are available to everyone, regardless of which agent or portal a consumer uses.
Compass is also seeking expedited discovery, including communications between Zillow, Redfin, eXp, and MLSs, as well as internal documents related to user traffic and portal competition.
A ruling on the injunction is expected later this summer or early fall.
Stay tuned for more as the story develops.
