Algorithmic Rent-Pricing Litigation Expands Under New State and Local Laws
New state and local laws are enabling a wave of litigation against landlords who use algorithmic revenue-management software to set rent prices. These statutes provide a more direct path to liability than traditional antitrust claims, leading to follow-on lawsuits across several U.S. cities.
Why it matters
The shift toward local regulation of pricing algorithms could significantly impact the business models of property management firms and the broader real estate market.
<p>A new wave of litigation focused on violations of municipal regulations is emerging against multifamily housing landlords, many of whom are facing antitrust litigation targeting their use of certain revenue management products. The new regulations may potentially provide a simpler path to liability and the possibility of significant penalties. </p>
<p>Following federal, state, and private litigation targeting RealPage, Yardi, and landlords that allegedly used revenue-management products, states and municipalities across the country have enacted laws restricting the use of algorithms or price optimization software to share or recommend rents, concessions, lease terms, or occupancy levels. These laws often authorize enforcement through a combination of private rights of action and public enforcement mechanisms, which has led to a new wave of litigation. </p>
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