Editor’s note: The COURT REPORT is RISMedia’s weekly look at current and upcoming lawsuits, investigations and other legal developments around real estate.
Zillow pleas fall on deaf ears
On Oct. 5, the U.S. Supreme Court officially declined Zillow’s appeal to hear a class-action shareholder lawsuit, formally known as Jaeger v. Zillow Group Inc.
In the transmittal letter, the court formally denied Zillow’s petition for a “writ of certiorari,” asking the nation’s highest court to review lower court rulings on class certification and related issues.
Generally, SCOTUS sees very few cases each year. For a case to be seen, at least four of the justices must agree to review the case.
The case started in late 2021, after Zillow announced that it was permanently shutting down Zillow Offers, its iBuying business. Zillow shareholders and investors soon filed the lawsuit, stating that Zillow had “made materially false and/or misleading statements, as well as failed to disclose material adverse facts about the Company’s business, operations and prospects,” according to the original complaint.
In essence, the plaintiffs argue that Zillow did not accurately report to its shareholders the predicament it faced with Zillow Offers, and as a result, the plaintiffs had suffered significant losses and damages.
A lawyer for the plaintiffs told Reuters that they “look forward to now moving this case to trial.”
CRMLS files suit against Compass
After much speculation and back and forth between the two parties, CRMLS filed its own federal lawsuit against Compass last week.
The fight over exclusive inventory and listing control has officially made its way into federal court, after the California-based MLS submitted a 36-page complaint against the mega-brokerage.
In the complaint, CRMLS states that “Compass wants to free-ride on the comprehensive listing contributions of thousands of cooperating brokerages while hoarding its own inventory for its exclusive financial benefit.”
CRMLS brought the lawsuit to court to establish that its “Cooperation Rules are lawful under federal and state antitrust law because they cause no anticompetitive harm, and are in fact widely recognized as procompetitive.”
As of this writing, Nathan Philip Eimer—of Chicago’s Eimer Stahl LLP—has appeared on behalf of Compass in the suit and the case has been designated to Magistrate Judge Katharine H. Parker of the Southern District of New York.
The original complaint also describes how the lawsuit arose from a formal demand letter dated Sept. 8, where Compass “threatened to bring a federal antitrust lawsuit against CRLMS, and unnamed other MLSs,” unless CRMLS ceased enforcing its rule that governs the submission of for-sale properties—specifically when the listing broker has an exclusive commission agreement with the seller preventing any buyer agent from accessing or communicating with that seller.
Generally, CRMLS argues that Compass wishes to benefit from listing data provided by CRMLS without contributing its own.
“The practical effect of what Compass seeks is to have its ‘cake and eat it too,’” the complaint states. “Compass wants to access and use the comprehensive listing data that CRMLS compiles from the contributions of thousands of cooperating brokers—while simultaneously withholding its own publicly marketed listings from the same cooperative pool.”
Texas MLS follows CRMLS in defying Compass
Texas-based Unlock MLS alleges that Compass had also mischaracterized its rules, after sending a letter to the company on Oct. 6.
The letter—from Ellen Sessions, a lawyer representing Unlock—claims that Compass offered an entirely incorrect description of how it enforces rules around marketing off-MLS listings as the brokerage threatens legal action against MLSs around the country.
In a letter largely identical to one it sent CRMLS, Compass told Unlock it would seek to pressure and pursue legal action against MLSs that don’t allow agents to withhold listings from the MLS while publicly marketing them elsewhere. The company claims that these rules are illegal and designed to protect MLSs, and argues that sellers and agents should be the ones to choose how a property is marketed.
Unlocked, for its part, claimed that only months ago, Compass was praising the same rules it now said are illegal.
“Compass cannot hold Unlock MLS up as a model of seller choice in March and threaten it with an antitrust lawsuit for denying seller choice in September,” Sessions wrote.
In a social media post, Unlock CEO Emily Girard said that Compass’ threat “isn’t a debate over one rule, and it isn’t only about the NAR Clear Cooperation Policy.”
“It’s a demand that we ignore a rule altogether, leaving it on the books while acting as if it isn’t there. That strikes at the very structure of the MLS,” she said.
Two Harbors and UWM merger falling out continues
After submitting a complaint against Two Harbors Investment Corp. in early August for a willful break of contract and fraud, United Wholesale Mortgage (UWM) faces a counter-complaint that was submitted Oct. 1.
The initial complaint by UWM involves the failed merger of the two parties. According to the complaint, Two Harbors had unanimously endorsed UWM as the winning bidder in December 2025, and had signed a merger agreement in which UWM would acquire Two Harbors for a value of $1.3 billion.
But, Two Harbors’ executive team—including CEO William Greenberg and Chief Legal Officer Rebecca Sandberg, as mentioned in the complaint—engaged in a “stealth mission” to kill the UWM merger.
Generally, the initial complaint argues that “(Two Harbors’) chicanery, backroom dealing and prioritization of management self-interest over its contractual and other legal obligations inflicted significant financial harm on UWM.”
In response to the initial complaint, Two Harbors alleges that shortly after the UWM merger was announced, UWM’s stock prices collapsed below the estimate Two Harbors share and stockholders were given, and the independent proxy advisory firm Institutional Shareholder Services (ISS) had refused to recommend the merger.
The counterclaim also states that after UWM’s stock price collapse, CrossCountry Mortgage (CCM) submitted an unsolicited, all-cash merger proposal—which was fully backed by a financing commitment letter from a leading national bank. Two Harbors states that they had complied with the merger agreement—which includes notifying UWM of unsolicited superior proposals, and giving them the opportunity to match it—and had terminated the merger agreement when it was made clear that UWM would not match CCM’s proposal.
“UWM’s intentional undisclosed breaches and chicanery were just one part of the mountain of misconduct and fraud perpetrated by UWM and its principals on Two Harbors and the investing public,” Two Harbors’ counterclaim states. “Immediately after UWM pocketed the $25.4 million, it then embarked on a highly inflammatory public relations and proxy campaign against the Two-CCM merger filled with lies and misstatements.”
