Zillow and several codefendants have formally asked a federal judge to dismiss a consolidated class-action lawsuit, denying allegations that the real estate listings company operates a coordinated scheme to steer homebuyers to affiliated lenders and artificially inflate agent commissions.
In a motion filed Feb. 20 in a Seattle-based U.S. district court, Zillow argued that the plaintiff’s 100-page amended complaint fails to plausibly allege how the company’s consumer tools caused financial harm. As Zillow’s legal team put it, the plaintiff’s “bloated” complaint “is heavy on filler but thin on substance” and suffers from a variety of “deficiencies,” in their view.
The dismissal motion marks the latest legal maneuver in the consolidated Taylor v. Zillow case, which names Zillow Group Inc., Real Brokerage, GK Properties and others as defendants.
The lawsuit hinges on two primary theories. First, the plaintiffs allege Zillow’s “Contact Agent” button deceives buyers into believing they are reaching out directly to a home’s listing agent. Instead, plaintiffs claim they are routed to buyer-side agents participating in the “Zillow Flex” program. Because these agents pay Zillow a portion of their commission from the subsequent sale, plaintiffs argue the agents are less likely to negotiate their fees, which, the plaintiffs hold, can inflate home purchase prices.
Zillow stridently countered this theory, arguing it relies on a speculative chain of inferences without factual support. The company noted that listing agent identities are prominently displayed directly on the property pages, so “any reasonable consumer” should have been able to “discern that the Partner Agent who contacted them is not the listing agent.”
The company’s legal team also emphasized that users must agree to terms of use explicitly stating they may be connected with a partner agent, and that Zillow may be compensated for facilitating that connection.
The next major allegation targets Zillow’s lending arm, Zillow Home Loans (ZHL). Plaintiffs accuse Zillow of violating the Real Estate Settlement Procedures Act (RESPA) by incentivizing Zillow Flex agents to steer buyers toward ZHL for mortgage preapproval letters.
Zillow denied this claim, asserting its preapproval letters are free to consumers and carry no obligation, which, the legal team argues, means they do not legally qualify as “settlement services” under REPSA. In support of this argument, Zillow’s filing noted that one of named plaintiffs received a ZHL preapproval letter but ultimately used a different lender to finance the home purchase.
Beyond challenging the core theories underpinning the plaintiff’s case, Zillow’s legal team argued that multiple claims fall outside the applicable statutes of limitations. The defendants pointed out that RESPA carries a one-year statute of limitations, while common law claims allow for three years, which they allege bars several of the named plaintiffs from seeking damages.
The company has requested that the court dismiss the class action complaint with prejudice.
