CoStar Group, which owns real estate portal Homes.com, today sued rival Zillow for alleged “widespread and systematic” copyright infringement of rental listing photos, claiming that hosting images owned by CoStar makes the company liable for extensive damages.
According to CoStar’s complaint, filed in the Southern District of New York, Zillow’s recent expansion into rentals involved utilizing at least 47,000 images of multifamily properties—mostly uploaded by property owners, but which CoStar claims ZIllow allows and profits from.
“Zillow’s theft of tens of thousands of CoStar Group’s copyrighted photographs is nothing short of outrageous,” said CoStar Group founder and CEO Andy Florance in a statement. “Zillow is profiting from decades of CoStar Group work and the billions of dollars we have invested.”
Notably, the lawsuit claims that Redfin and Realtor.com® used these same images by way of “lucrative syndication agreements,” with the lawsuit referring to these companies as Zillow’s “partners” or “supposed competitors.”
“If these other sites do not immediately remove our images, we will have no choice but to sue them as well,” Florance added.
Zillow representatives did not immediately respond to emails seeking comment.
A Redfin spokesperson declined to comment when reached by email. A Realtor.com spokesperson said the company would not comment on “this legal matter.”
The lawsuit would appear to be both an escalation of the ongoing “portal wars,” as Redfin, CoStar, Zillow and Realtor.com have squared off both in the courtroom and the public square, fighting over everything from website traffic to private listings to employees.
But the lawsuit also delves into more technical questions of how listing photos are used and syndicated, as well as their value in the industry—a question with huge implications beyond the lawsuit. The National Association of Realtors® (NAR) has described the legal landscape for photo copyrights as “fractured,” with various licensing and uses common across the country.
In 2019, Zillow was found partially liable for violating the copyright of a real estate photography company, though an appeals court ruled the company did not act “willfully” in its use of the copyrighted photos.
In its lawsuit, CoStar notes Zillow’s for-sale listings are drawn almost entirely from MLSs. But according to CoStar, as Zillow sought to rapidly expand its rental business this year, there was no easy way to obtain photos for multifamily properties.
Allegedly, Zillow “recklessly” allowed the CoStar photos to remain on its website, and to show up on Google searches. Zillow also used them to train its “Zestimate” valuation tool, according to CoStar. While many of the images were likely uploaded by property owners who had a license for them, CoStar added that its licensing terms do not allow sublicensing, or use of the photos on “competing real estate websites.”
“While Zillow may try to blame its customers, it is Zillow itself that is using CoStar’s images to build its products and earn revenue,” the lawsuit alleged.
Images include CoStar’s watermark, and the company claims Zillow easily could have used machine learning tools to instantly remove photos stamped with CoStar’s logo, but chose not to. CoStar claims the company sent Zillow a letter on July 10—inquiring generally about Zillow’s rental growth, though it was not clear if that letter addressed the specific copyright issues raised in the lawsuit.
Broadly, though, CoStar spends significant time claiming that Zillow depends on, and benefits from, the usage of these images as it seeks to grow its rental business. CoStar photos are sometimes used to entice property managers or owners to “claim” the listing on Zillow, according to the lawsuit, directly growing ZIllow’s business.
The lawsuit includes dozens of examples of these photos, purportedly found over the last three months.
And because Zillow has agreements with two of its biggest rivals—Redfin and Realtor.com—to share rental listings, the alleged misconduct involves those companies as well, CoStar claims. Over the last year or so, Zillow has struck eight and nine-figure deals with those two companies to syndicate listings, resulting in further syndication of the CoStar images.
“In short, Zillow effectively controls the multifamily listings on Realtor.com, Redfin, and their affiliated websites,” the lawsuit claims. “Zillow is publishing CoStar’s copyrighted images not just on Zillow’s websites, but also on several other rental listing websites, none of which have authorization to use CoStar’s images.”
This is a developing story. Stay tuned to RISMedia for updates.
Editor’s note: this story was updated with a response from Redfin at 10:57 a.m. eastern time.
Editor’s note: this story was updated with a response from Realtor.com at 12:10 p.m. eastern time.
