In a legal victory for Move Inc. and the National Association of Realtors, a Washington state Superior Court judge has granted a preliminary injunction against Zillow and its chief industry development officer, Errol Samuelson.
The injunction prevents Samuelson from performing many of the duties for which he was hired at Zillow in March, including obtaining direct data feeds from multiple listing services, real estate brokers, franchisors and real estate associations, and overseeing Zillow’s business-to-business products and tools.
Gavel image via Shutterstock.
Shortly after Samuelson unexpectedly jumped ship, Move and NAR filed a lawsuit against him and Zillow for alleged breach of contract, breach of fiduciary duty and misappropriation of trade secrets.
NAR subsidiary Realtors Information Network (RIN) and Move subsidiaries RealSelect Inc. and Top Producer Systems Co. are also plaintiffs in the suit.
Subsequent filings indicated that Move and NAR were worried Samuelson would take knowledge of secret projects with him to Zillow and sought to prevent him from working for the portal, but a motion to that effect was denied.
“NAR is very pleased that the court has granted our request for the preliminary injunction in this lawsuit. It is a significant win for NAR, Realtors, Move and realtor.com,” NAR said in an emailed statement.
“The ruling affirms the value of the information and tools that NAR and Move have created for Realtors and consumers and denounces those who would misappropriate trade secrets for their own benefit. NAR works hard to provide member services and resources and will always be committed to protecting Realtors’ interests and their relationships with clients and consumers.”
Move and Zillow declined to comment for this story, citing pending litigation.
In a July 1 court filing, Judge Barbara Linde said Samuelson, formerly Move’s chief strategy officer and realtor.com’s president, had misappropriated Move’s and NAR’s trade secrets by acquiring them using improper means and by copying information without authorization.
She further concluded that Samuelson’s conduct both before and after his resignation from Move threatens misappropriation of Move’s and NAR’s trade secret information and could result in “irreparable harm” to them if disclosed.
Specific trade secret information is redacted from the court filing.
From now until the case is over, the injunction prohibits Samuelson from directly or indirectly using, disclosing or relying on Move and NAR’s confidential or trade secret information, and prohibits Zillow from appropriating the information from Samuelson or using any information previously obtained.
Samuelson also cannot participate in much of anything having to do with listing feeds or Move-owned listing syndicator ListHub until the case has concluded. This includes:
- Efforts to acquire or develop a syndicator of real estate data.
- Efforts to interrupt the flow back to ListHub of leads generated by listings syndicated by ListHub and efforts to obtain access to those leads.
- Discussions or efforts related to the way Zillow supplies data to ListHub or the scope of that data.
- Discussions of strategy or public messaging regarding ListHub.
- Efforts to obtain direct feeds of listing data from multiple listing services, real estate brokers, franchisors or associations.
- Efforts to influence, interrupt or prevent the agreements, relationships or data feeds between those industry organizations and ListHub.
- Efforts to encourage data feeds from those industry organizations to parties other than ListHub.
- Efforts to circumvent ListHub.
For the next 12 months, Samuelson cannot engage in discussions or efforts pertaining to top-level domains. NAR has applied to create and manage several new top-level domains, including .Realtor.
For the next nine months, Samuelson can’t participate in efforts to obtain, use or display information about listings for rental, international or commercial real estate properties; provide information on homeownership and maintenance on Zillow’s websites; or discuss NAR’s plans or strategies surrounding realtor.com’s integration of NAR’s public advocacy initiatives.
Samuelson also cannot perform a slew of other activities for the next six months. He cannot participate in:
- Efforts to sell leads or to develop or market products that gather and sell leads to real estate agents, brokers or franchisors.
- Developing products that create websites for real estate agents.
- Developing contact relationship management tools.
- Purchasing or obtaining leads from third parties.
- Discussing Move’s business-to-business lines with Zillow or members of the real estate industry.
- Discussing the distribution or sale of leads to real estate agents, brokers or franchisors.
- Strategic planning regarding advertising displays on Zillow’s website.
- Discussion of advertising strategy or allocation of Zillow’s advertising spend.
- Discussions of Move’s budget, advertising spend or industry relations strategy.
Some of the activities Samuelson is not allowed to participate in have been redacted from the court filing.
Judge Linde further ordered Samuelson and Zillow to, by July 7, return to Move and NAR all copies of any of Move and NAR’s trade secret or confidential information, including all electronic and paper copies of contact lists, presentations, information stored on a Dell laptop Move issued to Samuelson, and any memory devices on which such information is stored. Samuelson had previously refused to return the laptop, claiming the device contained personal items.
Zillow hired Curt Beardsley, Samuelson’s successor at Move, less than two weeks after hiring Samuelson. Beardsley is vice president of industry development at Zillow and was not named in the suit.
Editor’s note: This story has been updated.