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Will the Feds shut down Upstream?

by Greg Robertson on May 11th, 2018

Government staffers question Upstream CEO on antitrust ahead of launch

Lange confirmed to Inman that he spoke with staffers from the DOJ and FTC yesterday and has separately spoken with staff attorneys for the Senate Judiciary Subcommittee on Antitrust, Competition Policy and Consumer Rights on two other occasions in September 2016 and January 2017, including a trip to Washington, D.C., to answer questions surrounding whether Upstream would violate federal anti-competitive laws.

So the government has questioned UpstreamRE on 3 separate occasions, in 2016, 2017, and now 2018? Does that sound normal? Does that inspire confidence?

“David Kully, a former staff attorney in the DOJ’s antitrust division, spoke at an MLS forum hosted by Zillow in Dana Point, California, in late April. He said if he were still at DOJ, he might ask whether Upstream “is something that is going to help facilitate brokers overcoming the competitive forces that have caused them to share data and to change from that.”

“I do not mean to say that the intent of Upstream was to allow brokers to stop competing on where they send listings and to reach a potentially illegal agreement to boycott listings portals, but I wonder whether it might unintentionally have that effect by making it easier for brokers to do so,” Kully said when reached by Inman.

“I haven’t spoken to anyone at the DOJ or FTC about this and don’t know whether this is on their radar screen.”

Real estate giant Zillow Group confirmed that it speaks with government officials regularly and has specifically pointed to Upstream as a company it has concerns about within the real estate ecosystem.

Mr. Kully has raised this same issue last month.

So the DOJ/FTC has questioned UpstreamRE 3 times over the past 3 years. The former lead attorney for the DOJ (who fought successfully for the DOJ and forced NAR to change it’s listing policy) says a side effect of Upstream could make it anti-competitive and Zillow (the 6,000 pound gorilla in the room who’s CEO regularly visits Washington D.C.) also “has concerns”.

Is anyone paying attention? Upstream is already two years behind schedule, and if it ever launches (and that’s a big IF) it appears there’s a good chance the government may shut it down. This after, less than a year ago, NAR approved an additional funding of 9 million dollars (I’ve lost count on how much already had been spent).

I think Will Rogers said it best.

“When you find yourself in a hole, stop digging.

Or maybe Kenny Rogers,

“You gotta know when to hold them, know when to fold ’em”

Or maybe Bruce Springsteen,

“It’s a death trap, it’s a suicide rap
We gotta get out while we’re young”

But hey, whatever man, roll the video…

  1. Simon permalink

    Even if the Feds don’t shut them down, Bob Goldberg could and should do that simply by removing funding for any more RPR work on it.


  2. GEORGIA PURPURA permalink

    When will NAR get the hint?… Stay in your own lane and do what you do well, focus on education and advocacy. Let the MLS/Tech world be innovative. Stop trying to drive in everyone else’s lane… Sorry NAR, but your charge has been slipping.

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