U.S. House Committee Eyes Compass Deal with Chicago MLS

Compass and Midwest Real Estate Data are being called to D.C. as the fight over private listings progresses.

Compass CEO Robert Reffkin and MRED CEO Rebecca Jensen received letters on Wednesday from the House Judiciary Subcommittee on the Administrative State, Regulatory Reform, and Antitrust requesting a briefing on MRED’s business practices and its partnership with Compass to bring its Private Listings Network to agents nationwide.

The subcommittee is examining allegations that “certain real estate companies have engaged in anticompetitive practices designed to insulate themselves from competition at the expense of consumers,” according to the letters.

The lawmakers are focusing on a partnership announced in April between Compass and MRED, which has already served as the center of a legal battle between the firms and Zillow over access to home listings.

The partnership and similar deals might be anticompetitive conduct under the antitrust laws “because they incentivize brokers to push sellers into private listings,” the committee said in the letter.

Zillow filed the federal antitrust lawsuit against MRED and Compass in May, alleging the companies conspired to harm Zillow and force it into displaying Compass’s private listings. The feud escalated when MRED followed through on its threat to shut off Zillow’s data feed, leaving the platform with less than half the listings in the Chicago-area of competitors like Redfin and Realtor.com.

The two sides are currently waiting on the results of a July hearing on Zillow’s preliminary injunction request to maintain its access to MRED’s listing feed.

The subcommittee raised concerns about how the partnership would impact the information available to consumers and what that would mean for housing affordability, and how it might incentivize brokers to push sellers into private listings and encourage double-ending, which it said “creates potential conflicts of interest.”

It also echoed industry concerns that Compass backing out of platforms like Zillow will enable it to bring buyers directly into its ecosystem.

The subcommittee requested Reffkin and Jensen’s appearances no later than Aug. 5 at 10:00 a.m.

A representative from Compass declined to comment. MRED in a statement confirmed the letter, adding that the MLS “looks forward to responding and helping the committee understand our business practices.”

Compass previously caught the attention of congressional lawmakers in December, when Senators Elizabeth Warren and Ron Wyden warned in a letter to federal antitrust officials that the deal between Compass and Anywhere “could harm consumers by making

it easier for these merged firms to keep commission fees artificially high and allow the merged

company to exert greater control over the real estate market.”

The brokerage has signed similar agreements with other MLSes, including Nashville-based Realtracs and Southern California-based MLS/Claw. It also inked a deal with Bright MLS, which covers the Mid-Atlantic states.

Compass has also recently faced regulatory scrutiny at the local. In June, The Real Deal reported that the New York Attorney General’s Office’s antitrust division is investigating Compass’ market share in New York.