Dive Brief:

• On May 22, the Federal Bureau of Investigation performed an unannounced investigation at the Atlanta headquarters of apartment owner and manager Cortland. Regulatory news site MLex first reported the story.  
• “We can confirm that the Federal Bureau of Investigation executed a limited search warrant at our Atlanta office as part of an ongoing investigation by the U.S. Department of Justice into potential antitrust violations in the multifamily housing industry,” Cortland said in a statement provided to Multifamily Dive. 
• In addition to fully cooperating with the investigation, Cortland said that neither the company nor its employees are targets of that investigation.

Dive Insight:

The DOJ declined to comment to Multifamily Dive on the search, while the FBI provided a brief statement.

“FBI Atlanta division agents were at the listed location conducting court-authorized activities,” a spokesperson said. “That is all we can say at this point.”

In March, the Department of Justice opened a criminal investigation into RealPage, as well as some of the large apartment owners and managers that use the company’s pricing software, to determine if the Richardson, Texas-based firm is facilitating price fixing, unnamed sources told Politico.

Politico, which did not name the owners and managers involved, called the criminal inquiry a “marked escalation of the probe” and said that the DOJ is concerned that RealPage’s software is being used as a shield for competitors to exchange sensitive pricing data that their rivals would otherwise be unable to access.

DOJ activity

In late 2022, the Justice Department’s antitrust attorneys reportedly opened a civil investigation into RealPage’s algorithm, as groups of Senators asked for more scrutiny in 2022 and 2023. Politico reported that the inquiry is ongoing, and the agency’s lawyers issued subpoenas earlier this year on behalf of a federal grand jury in Washington, D.C.

The DOJ has also waded into antitrust class action suits against RealPage. Last fall, it filed a brief saying a combined antitrust case brought by a group of renters against RealPage and multiple landlords should move forward and that apartment operators’ use of a shared algorithm is illegal under the per se rule of antitrust law.

Apartment pricing has been a target of state and federal investigators since ProPublica published a report investigating RealPage’s model in October 2022. In the months following the report, more than 30 class-action suits were filed against RealPage and apartment owners and managers. These cases were consolidated into the one lawsuit that moved forward in Tennessee.

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