On November 1, 2023, the District of Columbia filed a parens patriae antitrust lawsuit against RealPage, Inc. and fourteen of the largest landlords in the District alleging violations of the D.C. Antitrust Act. In its complaint, the District alleges that RealPage and the landlord defendants unlawfully agreed to use software created by RealPage known as “revenue management” software to inflate rents for tens of thousands of apartments across the District. This agreement allegedly caused District renters to pay millions of dollars in rent that they would not have, but for the defendants’ misconduct.
On November 15, 2023, the U.S. Department of Justice filed a statement of interest in a similar antitrust lawsuit filed against RealPlage in federal court in Tennessee.
As alleged in the complaint, the landlord defendants have extracted inflated rents by agreeing to delegate their price-setting authority to a centralized entity—RealPage—rather than competing on price. As part of this scheme, the defendant landlords also allegedly agreed to share competitively sensitive data which fueled the centralized software to which they delegated their pricing authority.
The impact of this misconduct is significant. According to the complaint: “The ever-climbing cost of housing is one of the toughest challenges facing District residents today. The District of Columbia is a majority-renter city. In recent years, however, staggering rent increases have become an unfortunate fact of life for District residents; approximately a quarter of all renters are forced to spend over 50% of their income on rent.”
“By demanding unlawfully high cartel rents,” the complaint alleges “Defendants have inflicted real harm on neighborhoods across the District. Every dollar of increased rent that the cartel illegally squeezes from District renters contributes to widening wealth gaps, forces hardworking residents to forgo other uses of their money, and pushes residents out of a District whose housing they increasingly cannot afford.”
Cohen Milstein serves as outside counsel to the Office of the Attorney General for the District of Columbia.