Property owners accused of ‘price-fixing’ rent in Seattle
A well-known website for property managers, as well as some of the largest rental property owners in the nation, have been named in a class-action lawsuit for ‘price-fixing.’
The suit, filed Friday in the U.S. District Court for the Western District of Washington, alleges they are guilty of price-fixing and creating astronomically high rents that have nothing to do with supply and demand.
“This is a calculated crime,” Seattle attorney Steve Berman said
The Puget Sound Business Journal and ProPublica report the website RealPage and property owners Greystar, Trammell Crow Residential, FPI Management, Avenue5, Equity Residential, Essex Property Trust (NYSE: EQR), Thrive Communities, AvalonBay Communities (NYSE: AVB) and Security Properties are named as defendants.
In a statement announcing the lawsuit, Berman, a managing partner at Hagens Berman law firm wrote: “Anyone who’s played the rental game in Seattle knows that prices have become astronomically high, and leasing companies would rather have the public believe it’s entirely due to honest supply and demand. Here, we believe we’ve found a smoking gun indicating that’s just not the truth.”
The statement went on to say RealPage specifically advertised the algorithm in its software was designed to focus on maximizing profits rather than filling empty units.
The Seattle Times spoke with University of Washington law professor Douglass Ross, an expert in anti-trust law about the suit.
In his opinion, “The way in which (the defendants) allegedly have agreed to raise prices is interesting.”
But, he acknowledged it would be a challenge for attorneys to prove rents went up solely based on the information provided by RealPage.
The lawsuit hopes to hold the companies liable under the Sherman Act and seeks repayment to any tenant overcharged on their rent because of the alleged scheme.
Separate suits allege price fixing in Seattle by apartment companies
“There’s no mistake about it. This is a calculated crime,” Seattle attorney Steve Berman said of one lawsuit that alleges price fixing by the operators of student housing properties.