of U.S. Department of Justice And eight states on Friday accused the software company RealPage of planning to illegally undermine competition among landlords and create a monopoly that would harm millions of renters.
The Justice Department said RealPage “enables landlords to manipulate, distort and subvert market forces.” Civil litigation In the U.S. District Court for the District of North Carolina.
“In essence, RealPage is an algorithmic intermediary that collects, synthesizes and uses competitively sensitive information about landlords,” the antitrust lawsuit states.
“In doing so, the Department enriches itself and compliant landlords at the expense of tenants who pay exorbitant rates and honest businesses that would otherwise compete,” the Justice Department argued.
Attorney General Merrick Garland was more blunt during a Friday morning press conference: “Everybody knows rents are too high. We would argue that this is one of the reasons why.”
The case marks the first time that a government has accused a company of systematically trying to subvert the rules of free-market competition using mathematical algorithms.
“Just because competitors find new ways to cooperate and commit illegal acts does not make antitrust laws obsolete,” Garland said.
“Americans shouldn’t have to pay higher rent just because corporations collude with landlords to find new ways to break the law.”
The Justice Department’s lawsuit was joined by the attorneys general of North Carolina, California, Colorado, Connecticut, Minnesota, Oregon, Tennessee and Washington.
RealPage is Private equity firms Thoma Bravo, X Statement The bank vowed to defend itself against the accusations and said the lawsuit was a “distraction” from the real economic and political issues that are driving inflation.
“After years of public awareness and collaboration on antitrust issues surrounding RealPage, we are disappointed by the timing of the DOJ’s lawsuit, which seeks to scapegoat a pro-competitive technology that has been used responsibly for many years,” RealPage said.
The company added that its revenue management software was “purposefully built to comply with the law and has a long history of working constructively with the Department of Justice to demonstrate this.”
Garland said the lawsuit follows nearly two years of investigation and comes in the middle of a U.S. presidential election in which high home and rental prices are key issues.
Democratic candidate Kamala Harris last week unveiled an economic plan aimed at lowering rents, including by cracking down on companies behind pricing tools that allow landlords to collude.
The White House declined to comment on the Justice Department’s antitrust lawsuit against RealPage.
But the paper published a statement from national economic adviser Lael Brainard saying President Joe Biden and Vice President Harris “recognize that too many Americans are struggling with high rent costs.”
“The Biden-Harris Administration has made clear that no one should have to pay a high price for corporate misconduct, and we will continue to support fair and rigorous enforcement of our antitrust laws to prevent unlawful collusion,” Brainard said.
— CNBC’s Eamonn Javers contributed to this report.
