Colorado Attorney General Phil Weiser has joined a Justice Department antitrust lawsuit against real estate software company RealPage Inc., accusing it of facilitating an illegal scheme that allows landlords to coordinate rent increases. The lawsuit, filed by Weiser and seven other attorneys general, alleges that RealPage’s algorithm enables landlords to set and align their rental prices, harming renters by forcing them to pay above competitive rates.
Weiser emphasized the importance of healthy competition between landlords to benefit renters and criticized RealPage’s market dominance for enabling collusion. RealPage has denied the allegations, stating that the claims are without merit and will not make housing more affordable.
The controversy surrounding RealPage’s algorithm has led to legal action in multiple states, with lawmakers in Colorado attempting to ban the use of such algorithms in rent-setting. However, a bill to address this issue stalled in the Senate earlier this year.
The Biden administration’s FTC chair Lina M. Khan recently met with Weiser in Denver to discuss antitrust issues, including RealPage’s practices. State prosecutors argue that RealPage’s use of confidential data to determine rental prices amounts to illegal price collusion.
RealPage’s practices came under scrutiny following a ProPublica investigation that suggested the company’s algorithm could be contributing to rising housing costs. Democratic lawmakers have expressed concern over these practices, with Senator Amy Klobuchar introducing legislation to prohibit companies from using algorithms for collusion.
In a speech in North Carolina, Vice President Kamala Harris pledged to crack down on corporate landlords engaging in price-fixing through algorithms. The ongoing legal battle highlights the significance of regulating technology in the real estate market to protect consumers and promote fair competition.
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