A federal judge has ordered two of the real estate defendants in the high-stakes Taylor v. Zillow class-action lawsuit to resolve their claims through arbitration, effectively pulling them out of court proceedings for now.
U.S. District Judge James L. Robart granted a motion to compel arbitration filed by Real Broker, LLC and Florida-based Frano Team on June 23, staying the case against both defendants pending the outcome of that process. The Zillow entities—Zillow, Inc., Zillow Group, Inc., Zillow Homes, Inc. and Zillow Home Loans, LLC—are not directly affected by the ruling and remain named in the lawsuit.
The ruling hinged on a buyer representation agreement signed by plaintiff John Cady, a Florida resident who purchased a home using Frano Team agent Emily LaPlante. That agreement named Real Broker as the broker of record and incorporated American Arbitration Association rules—language that Robart found was enough to send all questions of arbitrability to an arbitrator rather than the court.
A Real Brokerage spokesperson declined to comment on the ruling.
Zillow wrote on its website that the ruling is “yet another setback for the plaintiffs and just offers further proof that plaintiffs have simply been throwing new theories and parties at the wall without any substance behind them.”
According to the filing, plaintiffs pushed back on three grounds: that neither Real Broker nor Frano Team were parties to the agreement, that defendants had skipped a required mediation step before seeking arbitration and that the agreement’s scope was limited to an 11-week window that didn’t cover the disputed conduct.
Robart rejected each argument. He found Real Broker explicitly named in the contract and Frano Team entitled to enforce it as a subsidiary, and ruled that the remaining threshold questions were for the arbitrator—not the court—to decide.
Arbitration agreements have been a sore subject for the industry in the wake of the commission lawsuits (which were led in part by the same firm behind this suit), as judges repeatedly ruled that buyers and sellers could sue the National Association of Realtors® and big brokerages despite the vast majority of them signing listing contracts that included various arbitration clauses.
The consolidated suit, which also names GK Properties as a defendant, accuses Zillow of running a scheme to steer buyers toward its mortgage business through its Flex and Premier Agent programs, in violation of RICO—a federal law designed to curb racketeering and organized crime—and RESPA—the Real Estate Settlement Procedures Act.
The case took shape last fall when plaintiff Alucard Taylor first alleged that Zillow’s referral program tricked consumers into working with Zillow-affiliated agents.
Robart paused discovery in the case in March while he weighs Zillow’s pending motion to dismiss.
