The U.S. Justice Department is taking action against several large landlords for allegedly colluding to keep rents artificially high. The lawsuit alleges the use of an algorithm and sharing of confidential information to manipulate rental prices.
The U.S. Justice Department is suing several large landlords for allegedly coordinating to keep American rents high. The lawsuit claims that landlords used an algorithm to help set rents and privately shared sensitive information with their competitors to boost profits. The department, along with 10 states, is accusing six landlords that collectively operate more than 1.3 million units in 43 states and the District of Columbia of scheming to avoid lowering rents.
The landlords allegedly shared sensitive data on rents and occupancy with competing firms via email, phone calls or in groups. The Justice Department said one of the six landlords agreed to cooperate with prosecutors. The proposed settlement would restrict how the company can use their competitors' data and algorithms to set rents. The lawsuit also targets RealPage, a company that runs an algorithm that recommends rental prices to landlords. Prosecutors say the algorithm uses sensitive competitive information, allowing landlords to align their prices and avoid competition that would otherwise push down rents. RealPage denies these allegations, stating that their software is used on fewer than 10% of rental units in the U.S., and that their price recommendations are used less than half the time
RENT CONTROL LANDLORDS ANTITRUST HOUSING CRISIS ALGORITHM
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