Midwest Real Estate Data restored Zillow’s access to its licensed listing data May 22 after a federal judge granted Zillow’s request for a preliminary injunction, ordering MRED to reinstate listing feeds to its consumer websites while the companies’ legal dispute proceeds.

The ruling comes just days after MRED revoked Zillow’s access to its licensed listing data on May 20, saying Zillow failed to display 99.8% of its listings on Zillow’s platforms by the 11:59 p.m. May 19 deadline. MRED claimed Zillow chose not to display those listings because it “disagrees with the lawful marketing strategy associated with the remaining 0.02% of listings.”

Matt Kreamer, a communications director with Zillow, told Chicago Agent, “Today’s ruling is an important first step for the Chicago home buyers, sellers and agents who have been harmed by a coordinated scheme between MRED and Compass to reduce transparency in the housing market. In the middle of a housing affordability crisis, powerful industry players colluded to hide listings, suppress competition and steer consumers toward a single dominant brokerage. The court immediately recognized what was at stake, not just for Zillow, but for every person trying to find or sell a home across Illinois and beyond. We will continue to fight to ensure this anti-consumer conduct is not allowed to take root permanently.”

The dispute began when Zillow filed an antitrust lawsuit against MRED and Compass in federal court in Chicago, alleging the two companies worked together to “threaten Zillow’s Chicagoland listing data feed,” in Zillow’s words.

The complaint, which was filed on May 12, stems from an April agreement in which Compass said it would share its nationwide listings through MRED’s private listing network as part of an expanded MLS partnership.

Zillow Chief Industry Officer Errol Samuelson told Chicago Agent, “Fundamentally, this lawsuit is about consumers and competition and fairness in the real estate industry. The MLS in Chicagoland, which is meant to be a marketplace where all the brokers share their listings for the benefit of their sellers and their buyers, instead decided to work with the area’s largest broker and skew the rules to actually hurt consumers and hurt competition.”

Zillow claims the arrangement allows Compass agents across the country to enter listings into MRED in a way that extends leverage beyond Chicago and forces “competitors nationwide to abandon consumer protections.”

The complaint also alleges that in early May, MRED demanded that Zillow reinstate Compass’ private listings from outside of its territory and threatened to terminate Zillow’s access if it did not comply.

Zillow said that the listings they declined to display are for homes in California, Florida and Georgia, which they say are “not listings Chicago buyers and agents are concerned with.”

Additionally, Zillow claims those listings were initially hidden from most buyers and displaying them on Zillow while Compass kept them on the open market would be covering up a private listing scheme. According to Zillow, “MRED was looking for a way to cut off Zillow to help Compass, and they found it a few rule changes and thousands of miles away.”

MRED alleges that this dispute pertains to Zillow’s “attempting to impose” its own display rules on listings that are lawfully marketed under MRED policies, as well as at the discretion of sellers and their brokers.

According to Zillow, “This is the first time in MRED’s history it has ever claimed authority over listings outside its traditional service area. MRED cut off every Chicago broker’s access to Zillow’s audience over a handful of Compass listings in states MRED has never operated in. And it changed its own rules just to make it happen, at [Robert] Reffkin’s demand.”

Zillow also said that the rule MRED is claiming they violated did not exist when Zillow signed its agreement and that MRED changed them after Reffkin, the CEO of Compass, “personally emailed MLSs across the country urging them to cut off Zillow’s feeds.”

“Rules enforcement is the most important and difficult responsibility an MLS undertakes on behalf of the cooperative marketplace,” says Rebecca Jensen, president and CEO of MRED. “Our rules apply equally to every participant, and we have a duty to educate our participants and vendors, counsel them when they are out of compliance, and require that breaches be cured.”

MRED said that Zillow’s licensees could continue to access their services to contribute listings and facilitate broker and homebuyer transactions through MRED systems. Zillow-owned products and services, such as ShowingTime and Dotloop, were not affected.

Kreamer said that Compass reportedly holds 23% of MRED’s board seats and controls 35% of sales in the Chicago market. He said that Zillow believes MRED used that influence to “reshape its own rules” in ways that would benefit Compass at the expense of everyone else.

As part of the agreement, Compass agreed to subsidize part of the cost for the first 100,000 Compass agents who join MRED as full members, a move that Zillow claims could triple MRED’s size and “dramatically expand its power to impose its rules on the rest of the industry.” In return, Zillow argues that MRED agreed to use its control over Chicago-area listing data to pressure any platform that adopted stricter transparency rules.

Zillow says the lawsuit is based on alleged violations of the Sherman Antitrust Act.

Kreamer provided the following statement to Chicago Agent on May 20:

“Chicagoland home buyers and sellers [today] have far worse access to the housing market than they had yesterday, because their local MLS decided one megabrokerage’s profits mattered more than their ability to achieve the American dream.

“The people paying the price today are real. Sellers who listed their homes expecting to reach every buyer on Zillow. Buyers who just want to see every home available to them. Thousands of independent agents who had no voice in this decision and nothing to gain from it. MRED sacrificed them all to protect the hidden listing scheme of the largest brokerage in the country.

“MRED and Compass have colluded to turn back the clock on consumer transparency at the exact moment American families can least afford it, cutting off competition, hiding homes and engineering a market that extracts more from buyers and sellers so Compass can pocket more on every deal.

“[In recent days], MRED grasped at a different straw: seeking to force this case into arbitration so it doesn’t have to defend its conspiracy in court. This isn’t a mere disagreement over rules, And MRED should have to answer for its illegal conspiracy in a court of law.”

Devin Daly Huerta, senior corporate communications lead with Compass, provided the following statement to Chicago Agent on May 20:

“This is about whether homeowners have a choice in how they market their homes, or whether Zillow can set a one-size-fits-all policy for the industry. Chicago has long been a model for an open, competitive marketplace that empowers homeowners while ensuring broad access to housing information. We commend MRED for enforcing policies that protect both consumer choice and the fiduciary obligations agents owe their clients. Buyers in Chicago should not be deprived of access to listings because a platform disagrees with how a homeowner chooses to market their property.”