MRED just prevailed in its legal battle with Zillow. In a preliminary hearing, MRED prevailed on its right to enforce its own data licensing agreement with Zillow, one of their participating brokers. That agreement requires companies receiving MRED’s IDX data feed to follow the rules governing participation, including the obligation to display ALL listings provided through the feed.
Zillow created its own Listing Access “Standards” and used those arbitrary rules to ban certain listings from appearing on its site because those properties had previously been marketed using lawful marketing strategies. MRED challenged that practice and argued that Zillow, as a participating broker could not accept the benefits of an IDX feed while creating its own subjective rules about which listings it would display. The judge’s ruling supports MRED’s ability to uphold its own licensing agreement. This should be reinforcement for other MLSs who struggle with the Zillow Ban in their market.
This is a BIG WIN for brokers in Chicagoland and everywhere.
IDX Depends on Cooperation
IDX is one of the most powerful marketing tools ever created. It allows brokerages of every size to attract consumers to their own websites by displaying listings offered by other participating brokers. That system works because everyone agrees to play by the same rules. Without IDX and its rules, brokers are prohibited from advertising another broker’s listing.
If a participant can decide which listings it likes and which ones it does not, the entire premise of IDX starts to fall apart. What if a brokerage could decide not to display listings from its strongest competitor? Or what if a brokerage could refuse to display listings without floor plans or use a particular showing platform? Any of these subjective scenarios would be possible if brokers decide to ignore the rules agreed to when they sign a data licensing agreement.
That is exactly the type of subjective filtering MRED has been fighting to prevent. The concept of “objective criteria” has been central to MLS online display policies since the 2008 Department of Justice settlement with the National Association of REALTORS®. Those principles were designed to prevent discrimination based on brokerage business models and to support consistent access to MLS listing data when a listing is opted into the broker reciprocity program.
This Is a Big Win for Cooperative Reciprocal Marketing
If Zillow or any broker can create their own rules, it undermines one of the greatest benefits of Broker Reciprocity: giving brokers the ability to compete for consumer attention online by presenting a broad and cooperative marketplace of available homes. This ruling gets MRED and other MLSs one step closer to ensuring online marketing cooperation through IDX remains intact.
MRED Went to the Mat
In my view this is the most important part of the story. It would have been much easier for MRED to look the other way when Zillow’s self-serving listing standards conflicted with MRED’s data licensing agreement. Many MLSs have avoided the enforcement against Zillow in their market because of this litigation.
MRED challenged Zillow because its leadership believed protecting the integrity of Broker Reciprocity and the cooperative marketplace was the right thing to do for its brokers.
That takes guts.
MRED was willing to invest the time, money and organizational energy required to hold one of the largest companies in real estate accountable to the same licensing rules that apply to everyone else.
Congratulations to Rebecca Jensen, the MRED Board of Managers and the entire MRED team. You stood up for your brokers, defended the cooperative marketplace and helped protect one of the most important online marketing tools available to brokerages today. We rarely see that type of courage and commitment in real estate today.
IDX as we know it survives thanks to MRED’s willingness to fight for it.
