RealPage Antitrust Lawsuit Filed by State of New Jersey

New Jersey Attorney General claims coordinated rent-setting schemes may have forced residents to pay thousands more each year.

The state of New Jersey claims in a recently filed lawsuit that RealPage has colluded with some of that state’s largest landlords to inflate rents in what is already one of the United States’ most expensive rental markets.

The complaint (PDF) was brought by Matthew J. Platkin, Attorney General for the state of New Jersey, and Jeremy E. Hollander, Acting Director of the New Jersey Division of Consumer Affairs, in the U.S. District Court for New Jersey on April 23, naming RealPage, Inc. and 12 separate property management companies as defendants.

RealPage is a software company known for its real estate app, which assists property owners and managers in screening residents, setting rents, managing utilities and more.

However, evidence has emerged in recent months suggesting that RealPage uses an algorithm to illegally conspire with landlords to set higher rent prices. As a result, North Carolina, California, Colorado, Connecticut, Illinois, Massachusetts, Minnesota, Oregon and Washington joined together earlier this year to file a RealPage antitrust lawsuit in conjunction with the U.S. Department of Justice (DOJ).

The state of Washington later withdrew from that suit, to file its own, individual antitrust claim against the software company.

In addition to claims pursued by states and the federal government, a growing number of individual renters are also pursuing RealPage lawsuits, alleging the software’s algorithms are unfair, inaccurate, and contribute to inflated rental prices across competitive housing markets.

In New Jersey’s lawsuit, Attorney General Platkin alleges that RealPage conspired with the other named defendants to unlawfully inflate rental prices across the state.

Platkin claims the defendants engaged in an illegal antitrust conspiracy by using the RealPage platform to share sensitive, real-time data on occupancy rates and pricing strategies. Platkin alleges that the defendants even met together to coordinate their tactics and recruit others into the scheme, with the goal of driving rent prices higher.

In particular, the lawsuit accuses the landlords of using three RealPage revenue management software tools, YieldStar, AI Revenue Management (AIRM) and Lease Rent Options (LRO), to help coordinate their rental rates, keeping them above fair market prices. Platkin also alleges that landlords who deviated from the software’s automated pricing faced pressure and corrective actions from both RealPage and other participating landlords.

“The effects of this unlawful conduct have been staggering,” the lawsuit states. “A significant portion of New Jersey’s population has been forced to overpay for rent, month after month.”

Platkin raises allegations of violations of the U.S. Sherman Antitrust Act, the New Jersey Antitrust Act and New Jersey Consumer Fraud Act.

He is seeking to appoint a corporate monitor to ensure the defendants do not continue engaging in illegal conduct, as well as civil penalties and actual, statutory, punitive and treble damages.