The joke seems to have been lost on CoStar’s leadership.
The real estate data giant, which has come under fire recently for its allegedly draconian managerial style that is said to have included surveilling remote workers, is now seeking an injunction to stop an ex-employee from mocking the company on social media.
Within 24 hours of filing an arbitration demand last week against Nate Peterson, a researcher it fired last year for poor performance, CoStar called employees around the country into private meetings and terminated them, effective immediately, sources said. Some of those let go suspect their firing was a reprisal for engaging with an Instagram account critical of the firm.
It is unclear how many were axed, but Peterson, whose Instagram account CoStar Memes has become a sounding board for the firm’s disaffected employees, said it could be dozens.
CoStar declined to comment on personnel matters, but a spokesperson said that the company “did not terminate any employees for following a social media account.”
An enemy within
A dominant player in commercial real estate data, CoStar has earned a reputation as an exacting, inflexible employer that, among other things, charges employees for parking at their own workplace and dismisses them for minor offenses. During the pandemic, it reportedly asked its IT staff to track remote workers’ online activity.
CoStar has disputed its negative portrayal in media reports and claimed a conflict of interest at one of its main antagonists, the news outlet Insider, whose parent company, German publisher Axel Springer, competes with CoStar in Europe.
In interviews, two employees who were fired last week described the company’s handling of their dismissal as unprofessional. They were offered severance packages worth several thousand dollars each, but HR gave only vague explanations for their firing — they were no longer “a good fit” for the company — and dodged further inquiry into the rationale, they said.
The employees, who worked in different departments on opposite coasts, claimed to have positive relationships with their colleagues and direct managers and no performance-related issues. Both said they were meeting or exceeding expectations in their roles, and each had been in their positions for a year or less.
It wasn’t until hours after being fired that each recalled, independently, that they had been warned by Peterson against engaging with the CoStar Memes Instagram account using their real names. A professional data scraper reached out to Peterson in April, he said, claiming to have been offered a contract by CoStar to find out who had followed, liked or commented on the meme account’s posts. Peterson relayed the warning to his followers.
One terminated employee, who began following Peterson’s account in March, said he made two stray comments on posts, which he described as innocuous. After the warning, he said he unfollowed the account and “unliked” any posts he’d previously engaged with.
The other, who claims to have never followed the account and visited it only for due diligence purposes (he worked in recruiting), had “liked” a couple of memes back in February.
“This is literally the final scene from ‘Old Yeller,’ corporate edition,” he said.
Defiance and deflection
Peterson, who worked in CoStar’s Richmond, Virginia, office from June 2017 to July of last year, launched CoStar Memes in December — as a joke among friends, he says, including former colleagues. CoStar has described him as a “disgruntled” ex-employee with an “unhealthy obsession” with the company.
Peterson, who is newly employed, says he was passed over for a promotion before he was let go, but claims to have had no personal vendetta regarding his firing and said he makes no money from the account.
Over the last six months, CoStar Memes has evolved into a forum where current and former employees tell stories and air grievances about the company, which have included allegations of drug use, shady client practices and “creepy Me Too stuff,” in Peterson’s words.
“The memes were just the start of it,” he said. “The stories are where it really took off, because everyone was able to see how shitty the culture was and how badly people were being treated. I don’t write any of the stories. I just make the memes.”
Today, CoStar Memes has more than 2,600 followers, many of whom use anonymous accounts to engage with it, presumably to avoid reprisal. They send Peterson opinions and tales of their experiences, and he reposts them as “stories” — short-format images and videos that disappear from Instagram after 24 hours. The posts are generally critical, often crude, and many are aimed at CoStar CEO Andy Florance, who ex-employees credit as the source of the company’s oppressive policies.
“The fact that this guy is so unhinged over memes…..,” one post reads. “If 1/100th of that energy were dedicated to treating employees appropriately, there would have been no problems in the first place.”
Another reads: “So tired of business being able to just wave away any and all claims someone makes by saying ‘disgruntled former employee.'”
In its arbitration demand — a form of dispute resolution that involves an impartial intermediary, typically a retired judge or lawyer — CoStar is seeking a permanent injunction against Peterson’s social media posts criticizing the company, which it says violate a non-disparagement clause in his employment contract. It is also seeking $1 in nominal damages and compensation for related legal fees.
The CoStar spokesperson cited employee safety as a motivation. In February, after Insider published its investigation, an arsonist set two cars outside of the company’s Richmond office ablaze. Police later arrested an 18-year-old suspect who had no known affiliation with CoStar, Insider reported.
“We are taking action against conduct that glorifies violence against the company’s employees,” the spokesperson said.
Peterson remains defiant, and contemptuous of Florance. His aim is to “bleed them dry for as long as possible,” he said, adding that he may “try to escalate” the situation if his legal counsel advises him to do so.
“I’m looking forward to any fight that [Florance] brings on,” he said. “He can do nothing to me, as I have nothing to give him.”