The latest complaint maintains the same core allegation as the initial complaint, which claimed that the portal tricks consumers into using agents affiliated with Zillow through its Flex and Premier Agent programs, resulting in inflated home purchase prices. The testimony in the amended complaint supports these claims.
According to the amended complaint, Zillow incentivizes agents to “burn and churn” through clients, to cherry-pick borrowers to intentionally conceal loan officers’ inexperience and to use Follow-Up Boss to eavesdrop on client communications and to censor agents from recommending competing loan providers.
Testimony from the 12 additional witnesses includes claims that Zillow personnel fly to real estate offices to instruct Zillow Flex agents in person on the need to meet Zillow Home Loans (ZHL) quotas to avoid putting things in writing, and that Zillow’s loan officers frequently misrepresent or omit important details about borrowers’ true closing costs, leading buyers to pay excessive costs or lose the house.
Additionally, the amended complaint claims that Zillow pushes homebuyers to apply to more costly loans that do not serve their best interests, which the plaintiffs’ attorneys claim amount to violations of the Racketeer Influenced and Corrupt Organizations (RICO) Act.
“Zillow’s practices and policies in the real estate industry are not simply indifferent to the agents’ duties to protect their clients’ interests; Zillow actively schemes to subvert them,” the lawsuit states. “Zillow’s goal is simple: to monetize every step of the home buying process—even if illegally — and to encourage, incentivize and ultimately coerce agents into violating their fiduciary duties by disregarding their clients’ interests.”
The plaintiffs are being represented by Steve Berman, a named partner at class action litigation firm Hagens Berman Sobol Shapiro LLP, the same firm that represented plaintiffs in the Moehrl commission lawsuit.
“Twelve current and former agents and loan officers have bravely stepped forward to help our clients build a comprehensive case against Zillow, and with their added information, we believe this lawsuit has the potential to bring major changes to Zillow’s policies and practices,” Berman said in a statement. “Our firm first upended the real estate industry in bringing antitrust claims to brokerage commissions, and we intend to bring the same scrutiny and expertise to our case against Zillow.”
Zillow did not immediately respond to HousingWire’s request for comment.
