Zillow is facing another lawsuit stemming from its February 2025 deal with fellow apartment listing giant Redfin, this time from a disgruntled investor.
Matt Breidert filed a class-action suit against Zillow, the company’s CEO, Jeremy Wacksman, and its CFO, Jeremy Hofmann, alleging that he and other investors were misled about the nature of Zillow’s deal with Redfin, per the June 9 complaint filed in the U.S. District Court, Western District of Washington. Rather than a partnership, he claims the move was “an anticompetitive acquisition that placed Zillow at materially heightened regulatory risk.”
After the deal drew the ire of the Federal Trade Commission and five state attorneys general last fall, Zillow continued to downplay its legal exposure, Breidert alleges, and Zillow’s statements about its business, operations and prospects “were materially false and misleading.” Breidert said he purchased Zillow’s stock at artificially inflated prices and would not have bought it at that price if he had more information, if at all.
The lawsuit, titled Breidert v. Zillow Group, Inc., et al., was filed on behalf of those who bought Zillow class A or class C common stock between Feb. 11, 2025, and May 7, 2026, per the complaint. Breidert said he suffered damages as a result of Zillow’s alleged securities laws violations and wants to recover them. He is asking for a jury trial.
“Zillow represented to investors that the Redfin Agreement expanded its distribution and increased listing inventory as a key part of Zillow’s long-term strategy,” Breidert said in the complaint, but “in truth, the agreement required Redfin to transfer its business to Zillow and exit the multifamily rental advertising market altogether,” without disclosing as much to investors.
A Zillow spokesperson told Multifamily Dive that it maintains its deal is legitimate.
“Our rental listings partnership with Redfin is pro-competitive and pro-consumer, and we remain confident in that position. We stand by our business model and will vigorously defend against these allegations,” the spokesperson said in an email.
Competition too friendly?
Zillow and Redfin operate two of the nation’s three largest rental internet listing service networks by traffic and revenue, including sites such as Zillow Rentals, ApartmentGuide.com and Rent.com, per the FTC’s complaint.
Last year, Zillow paid Redfin $100 million to end its contracts with advertising customers and help Zillow take over that business; stop competing in the market for multifamily properties for up to nine years; and serve as the exclusive syndicator of Zillow listings — actions that the FTC said eliminated Redfin as a competitor in the ILS multifamily advertising market.
“This agreement is nothing more than an end run around competition that insulates Zillow from head-to-head competition on the merits with Redfin,” the FTC said in its Sept. 30, 2025, complaint. The FTC said the partnership harms property operators and renters because it will likely lead to higher prices and worse terms, and reduces incentives for Zillow and Redfin to compete.
On Oct. 1, 2025, attorneys general of Washington, Arizona, Connecticut, New York and Virginia filed a lawsuit that similarly argued that the firms violated the Sherman Act. A federal judge combined the FTC and state lawsuits in December 2025.
Zillow’s class C and class A common stock prices fell after news reports about the FTC’s lawsuit were published on Sept. 30, according to Breidert’s complaint. Stock prices tumbled further after Zillow’s Q4 2025 earnings call in February 2026, in which Hofmann disclosed “ongoing elevated legal expenses,” and prices fell again in May after a federal judge denied the rental agencies’ motion to dismiss the FTC and states’ combined suit.
Breidert said in the complaint that he believes there are hundreds or thousands of people affected by Zillow’s actions.
“As a result of Defendants’ wrongful acts and omissions, and the precipitous decline in the market value of Zillow’s Common Stock, Plaintiff and other Class members have suffered significant losses and damages,” according to the complaint.
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