Lawsuit against Zillow dismissed
Company accused of kickbacks, racketeering
By: Maddle McGay
NorthJersey.com
USA Today Network - New Jersey
..... In the midst of several legal battles over its practices, Zillow has secured a key court victory.
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Seattle-based U.S. district Judge James Robart on July 27 [2026] dismissed a lawsuit against Zillow that said the company violated the Real Estate Settlement Procedures Act and the Racketeer Influence and Corrupt Organization Act by allegedly steering home-buyers toward Zillow-affiliated agents and Zellow Home Loans.
..... Zillow and fellow defendant GK Properties field motions to dismiss in February, [2026] arguing that the plaintiffs' lengthy complaint was "heavy" on filer but thin on substance."
..... "Plaintiffs' claims of lack of notice are implausible given Zillow's express, repeated disclosures," the dismissal ruling reads. "Plaintiffs fail to p;lead specific facts showing how Defendants' practices actively undermined th home-buying process, restricted informed leader choice, or eroded trust in real estate professionals."
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In the suit, originally field in September 2025, plaintiffs Alucard Taylor alleged that Zilliow tricks consumers into using agents affiliated with the portal through its Flex and Premier Agent programs, resulting in inflated home purchase prices. An amended complaint field in November 2025 said Zillow uses internal incentive to steer home-buyers to use its own mortgage business, Zillow Home Loans.
..... The lawsuit was consolidated in December 2025 with a second complaint, by plaintiff Araba Armstrong, first filed in November 2025 with similar claims.
..... Robart said in his ruling hat the complaints did not have enough factual allegations to substantiate the claims the plaintiffs made.
..... The ruling said Zillow's website clearly displays the property's actual listing agent, and therefore it is implausible that buyers are tricked into working with a Zillow-affiliate agent.
..... The complaint said that even though a Zillow-affiliate agent are free, the buyer's agent still receives a commission if the sale goes through. the ruling said those lack standing, because the fee in questioner came out of the seller's agent's total compensation, which was split with the buyer's agent, rather than from the buyer.
..... The ruling also said the complaint failed to identified necessary information that highlighted exactly how Zillow allegedly steered home-buyers to its mortgage services.
..... After the ruling, Zillow praised the judge for dismissing the "baseless complaint."
..... "What the court ultimately found was that plaintiffs had described ordinary business activity and called it a conspiracy," Zillow wrote on its Front Porch blog. "after a whopping five rounds of complaints, the still hadn't identified the who, what, when, where or how that would connect Zillow's standard practices to any actual injury - so the court dismissed every count."
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The court allow the plaintiffs t file an amended complaint by August 17, [2026] saying it "cannot conclude that Plaintiffs are entirely incapable of curing these defects" from their earlier filings.