Zillow investors file securities fraud class action over Redfin deal and stock declines
Bleichmar Fonti & Auld says it filed a securities fraud class action against Zillow Group and certain executives, alleging investors were hurt by stock drops tied to the company's Redfin deal and later FTC litigation.
Bleichmar Fonti & Auld LLP says it filed a securities fraud class action against Zillow Group, Inc. and certain senior executives over investor losses it links to Zillow's agreement with Redfin and later legal developments involving the Federal Trade Commission.
The complaint, filed in the U.S. District Court for the Western District of Washington, alleges claims under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 on behalf of investors in Zillow Class C and Class A common stock, according to the firm's Aug. 4, 2026, press release.
The release says investors have until Aug. 10, 2026, to ask the court to appoint a lead plaintiff.
What happened
The release says Zillow entered an agreement with Redfin on Feb. 6, 2025, under which Zillow became the exclusive provider of multifamily rental listings on Redfin platforms and affiliate websites, including Rent.com.
According to the firm, the complaint alleges Zillow described the arrangement as a partnership that gave it exclusive access to Redfin's advertising platform. The release says the complaint claims the real terms were different: Zillow paid Redfin $100 million to stop competing, move its multifamily rental advertising business to Zillow and close the rest of Redfin's business.
The release links that alleged conduct to subsequent market moves. It says that on Sept. 30, 2025, the FTC filed a complaint against Zillow and Redfin alleging federal antitrust violations, and Zillow's Class C and Class A shares fell 4.33% and 4.5%, respectively. It says Zillow's stock fell again on Feb. 10, 2026, after the company's chief financial officer said increased legal expenses would create about a 200 basis point headwind to first-quarter EBITDA margins. The release says Class C shares fell 16.54% and Class A shares fell 17.13% that day.
On May 7, 2026, Reuters reported that a federal judge rejected Zillow and Redfin's request to end the FTC lawsuit, the release says. It says Zillow's Class C stock fell 1.9% and Class A stock fell 1.76% after that report.
What it means
The case adds another legal challenge for Zillow, which is already facing an FTC lawsuit over the Redfin arrangement, according to the release. The new action seeks to represent investors who bought Zillow Class C and Class A shares during the period described in the complaint.
Context and background
The PR Newswire item says the case is captioned Breidert v. Zillow Group, Inc., et al., No. 26-cv-02016. It says the lawsuit is pending in federal court in Washington state.
The release also includes quotations attributed to the FTC complaint and to Zillow's chief financial officer, but it does not provide separate comment from Zillow or Redfin on the new securities case.
What happens next
Investors who want to seek lead-plaintiff status must act by Aug. 10, 2026, the release says. The case will then continue in the Western District of Washington unless the parties reach a settlement or the court dismisses claims.
Sources
Editorial note: This article was prepared with AI assistance and includes source attribution for reader review.
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