Move, Zillow Reach Settlement on Eve of Trial
Source: Graham Wood, REALTOR® Magazine
Zillow agreed Monday to pay $130 million to settle allegations that two of its executives stole trade secrets from Move Inc., operator of realtor.com®. The settlement came just as the case was preparing to move to trial, with jury selection slated for this week.
“We are pleased that the parties have reached an amicable resolution,” said National Association of REALTORS® President Tom Salomone, in a prepared statement released late Monday.
NAR was a co-plaintiff in the suit, brought in 2014 against Zillow and the two executives, both former executives of Move. Move and NAR had accused the former Move executives, Errol Samuelson and Curt Beardsley, of stealing confidential documents and breaching their fiduciary duties to the company.
Among the key issues to be decided was whether the executive defections played a role in derailing a potential Move-Trulia merger. Judge Sean O’Donnell of the King County Superior Court in Seattle ruled in pre-trial motions that Move and NAR showed sufficient evidence to argue that, because of the defendants’ acts, Zillow was “unjustly enriched” by its acquisition of Trulia – a claim that could have carried up to $1 billion in damages. O’Donnell had also granted a motion to allow a jury instruction on evidence destruction by Beardsley.
In the settlement, Zillow admitted no wrongdoing. Zillow spokeswoman Amanda Woolley said the company wanted to move on from the court battle with Move. “The agreement allows us to put this litigation behind us and continue our focus on innovation.”
Likewise, Move issued a statement saying it looked forward to “returning our full focus to simplifying the real estate process for consumers and the real estate professionals who serve them.”
Move will receive the bulk of the settlement funds. After it deducts legal fees, NAR will receive 10 percent of the remaining proceeds. The association’s Leadership Team will “consider how best to apply those funds in service of NAR’s REALTOR® members,” said Salomone. “We will share that information as soon as a decision is made.”
Meanwhile, NAR is encouraging Move to use its proceeds to continue improving the consumer experience on realtor.com® and boosting the REALTOR® brand. “NAR’s relationship with Move Inc. and realtor.com® is based on a mutual respect for REALTORS® and their efforts to bring online home buying and selling resources to consumers,” Salomone said.