RealPage Conspiracy to Fix Greater Boston Area Rents Class Action

This antitrust class action brings suit against RealPage, Inc. and a list of apartment rental companies like Greystar Real Estate Partners, LLC, Cushman & Wakefield, Inc., and Lincoln Property Company, alleging that they have conspired to fix or raise housing rental prices in the Greater Boston Metro Area, through collusion and the use of RealPages AI Revenue Management (formerly YieldStar) software platform.

The class for this action is all persons and entities who paid rent for a residential unit in the Greater Boston Metro Area which was owned, managed, or controlled by one of the defendants in this case using YieldStar, AI Revenue Management, or any other RealPage software, between January 1, 2016 and the present.

The Greater Boston Metro Area runs from Interstate 495 on Boston’s west and south to the Atlantic Ocean in the east and the New Hampshire border in the north.

Normally, rental managers set rents independently, to keep occupancy high. Vacant units lose money, so when occupancy is low, it makes sense for them to lower rents to get properties occupied and producing rent. However, the complaint alleges that RealPage, its software, and collusion with other rental entities have provided a different way to profit.

According to the complaint, the AI Revenue Management software gathers large amounts of non-public information from its participants’ property managers, about things such as rents and occupancy, then provides that and other data to an algorithm that comes up with a rent figure for every one of the participants’ units.

“RealPage makes sure all of its clients know that to maximize revenues, they must accept the software’s rental price at least 80%-90% of the time,” the complaint alleges, “and RealPage’s ‘Revenue Management Advisors’ monitor clients’ compliance with that recommendation.” Thus the complaint claims that RealPage and its clients have formed a cartel that fixes or maintains rent levels for housing in the area.

The collusion achieves certain things, the complaint alleges: It encourages rental companies to charge higher prices than they would have dared charge on their own; it pressures them to accept the suggested rents; it staggers vacancies, so that occupancy rates are less likely to be high all at once; and it facilitates the exchange of information among companies that would ordinarily be competing against each other.

“Specifically,” the complaint alleges, within the delineated area, “rents rose while vacancy remained the same from 2015-2020, demonstrating that the forces of supply and demand no longer control the price of rent in the Greater Boston Metro Area.” It claims that the conspiracy is an unlawful restraint of trade that has “resulted in artificially inflated rent prices and a diminished supply of rental units” in the area.

Article Type: Lawsuit
Topic: Antitrust
Tags: Antitrust, Collusion and Price Fixing, Requiring Consumer to Pay Higher Prices, Residential Rentals or Leases