When Compass demanded in September that multiple listing services stop sending its agents’ production and listing data to third-party recruiting platforms, the brokerage giant opened another front in its fight over how real estate information is shared — and who gets to profit from it.
The Sept. 23 letter identified tech vendors Courted, BrokerMetrics and Brokerkit as examples of companies using MLS data to help brokerages recruit agents from competitors.
“The MLS exists to facilitate real estate transactions — not to weaponize our operational data against us for competitor poaching,” the letter stated, as Inman first reported.
Compass asked MLSs to identify data feeds supplied to recruiting vendors, exclude Compass-affiliated brands from those feeds, while allowing independent franchise owners to opt in, and clarify brokers’ rights to opt out of data sharing beyond IDX and VOW. The company argued that mandatory MLS participation shouldn’t require brokerages to supply data for competitors’ recruiting efforts, warning of potential damage claims while offering to release those claims if MLSs complied within 30 days.
Compass has since made the financial stakes of that argument clearer in federal court. In an Oct. 16 antitrust lawsuit against California Regional Multiple Listing Service, the company alleged that it had lost millions of dollars in commissions from agents recruited away using data the MLS sold to competing brokerages. The lawsuit, filed after CRMLS sued Compass in New York on Oct. 5, primarily challenges rules requiring brokerages to share publicly marketed listings with the MLS.
But the recruiting-data dispute goes beyond agent poaching, raising questions about how MLS data is licensed, who controls it and how brokerages use that information for everything from agent retention and coaching to performance analysis and recruiting.
What these data vendors actually do
Mike DelPrete, a real estate technology strategist and scholar-in-residence at the University of Colorado Boulder, said Courted uses MLS production data and machine learning to predict agents’ future performance and identify potential recruits or agents who may leave their brokerages. DelPrete is also an investor in Courted, he told Inman.
“Agents leave breadcrumbs that are telltale signs that make them more or less likely to switch brokerages,” DelPrete said.
For example, a brokerage might use historical production trends to identify an agent whose business is growing and who could become a valuable recruit. Meanwhile, the same technology could identify existing agents showing signs that they might leave.
Clint Skutchan, an industry consultant and former MLS executive who now operates 22 Intelligence, said managers can also use production data to evaluate their offices, learn what top producers are doing differently and identify agents who need additional coaching.
“Yes, it can be weaponized for recruiting, but there are a number of other use cases for agent productivity that the brokers themselves can use to better their own business,” Skutchan told Inman.
But MLSs have traditionally been reluctant to facilitate recruiting among their own members, in part because many operate under Realtor associations, Skutchan said.
“The vast majority of MLSs that I know are very averse to providing that data directly,” he said.
Instead, brokerages generally obtain data through MLS licensing arrangements that allow them to work with third-party technology providers.
“The relationship is the broker gets their data back,” Skutchan explained. “That’s an NAR requirement; the broker can get their data back, and they can choose to direct that towards any provider they wish.”
Skutchan said specific arrangements vary by MLS and are governed by licensing agreements. While MLSs generally don’t provide recruiting services themselves, outside vendors can use authorized data for recruiting and other brokerage functions.
Who profits from brokerage data?
DelPrete said Compass’ disputes with Zillow, MLSs and third-party data vendors share a common thread.
“They’re all companies that are profiting off what Compass considers to be their data, the listings,” he said.
Mike DelPrete
Compass agents do the work of securing listings, DelPrete explained, while other companies use that information to generate revenue through advertising, leads, analytics and other services. DelPrete said Compass has held this position for years, long before its acquisition of Anywhere Real Estate, but its growing size has given it more resources and incentive to fight these battles.
“They’re bigger, so they have more weight to throw around. They have a bigger legal team. They have a bigger legal budget,” he said.
Still, DelPrete sees merit in both sides of the dispute. He said Courted follows the rules and provides valuable services, but he also understands why brokerages might object to other companies profiting from their information.
“If I’m a brokerage, big or small, I’m going to have second thoughts about somebody else monetizing my data without me getting a cut,” DelPrete said.
Inman reached out to all three companies named in Compass’ September letter — Courted, BrokerMetrics and Brokerkit — to ask about the demands and whether they had affected their businesses.
In an email response, Courted co-founder and CEO Sean Soderstrom said that the company does not discuss confidential communications with MLS organizations, customers or other industry participants, nor does it publicly disclose individual data-feed arrangements. He added that Courted’s access to and use of MLS data are governed by the relevant agreements, policies and permissions.
“We believe MLS data policies should be clear, consistently applied and neutral as to whether a brokerage builds technology internally or relies on an outside provider, while maintaining appropriate security, authorization and use safeguards,” Soderstrom wrote.
Lone Wolf, the company behind BrokerMetrics, also declined to discuss the demands.
“We are abiding by the terms of the data licensing agreements we have in place with our MLS partners,” a spokesperson said over email.
Brokerkit did not respond to requests for comment. None of the companies confirmed whether Compass’ demands had affected their data access or customer relationships.
An ‘odd request’ with bigger implications
Skutchan described Compass’ September demands as “an odd request,” particularly given their timing amid the company’s growing legal fight with MLS organizations. Still, he believes the letter raises a legitimate question about what happens to brokerage data after it enters the MLS.
“Have we really thought about downstream utilization rights in totality,” he asked, “and what kind of policies do you have in place beyond the basics of what all of your licensing agreements include as an MLS?”
The issue is becoming more complicated as large brokerages grow through consolidation. MLSs depend on participating brokerages sharing listing information, but the largest companies contribute far more data than smaller competitors.
Clint Skutchan
Skutchan said that disparity can raise questions about whether a cooperative system provides equal value to all participants.
“When I’m putting in more data than anyone else, and I have more people than anyone else, is this a reciprocal cooperative where they’re getting so much more information out of it than I’m getting on the other side?” he said, describing the concern from a large brokerage’s perspective.
But he also questioned the way Compass presented its objections, suggesting the letter made MLS organizations appear responsible for providing recruiting services that, in his experience, are generally offered by outside vendors hired by brokerages. Skutchan said he was unaware of an MLS directly selling recruiting services to competing brokers, although he acknowledged that exceptions could exist.
Skutchan also pointed to Compass CEO Robert Reffkin’s appearance at the Council of Multiple Listing Services conference in September as a turning point in the company’s broader conflict with MLSs.
“It was a jarring message delivery. It was a change in tone,” he said, describing Reffkin’s remarks to MLS executives. “I think that was where the match really got lit.”
Art Carter, CEO of California Regional MLS, was also in the room that day. While the broader legal demands had put MLS leaders on notice, Compass’ separate requests concerning recruiting data raised another concern for Carter: whether the brokerage was seeking restrictions on competitors that it wouldn’t follow itself.
Carter said CRMLS licenses data for recruiting and related analytics. The MLS asks vendors how they intend to use the information, he said, but the permitted uses can be broad. He also said executives at some of the companies named in Compass’ letter had told him the brokerage uses their services, although he had not personally reviewed the companies’ individual licensing agreements.
“Our biggest concern was that Compass was not holding themselves to the same standard that they wanted to hold everybody else to,” Carter said during a November call with Inman.
Carter said CRMLS and its attorneys saw potential antitrust concerns if Compass continued benefiting from such services while seeking to restrict competitors’ access to similar information.
Compass disputed that characterization. A Compass International Holdings spokesperson told Inman over email that some independent franchise owners use the platforms named in its September letter and are free to choose their own technology.
“If a technology company makes our data available to brokerages that use it to recruit our agents in any way, we want all brokerages across all companies to have the right to opt out of having their data shared with that technology company,” the spokesperson said. “Any brokerage should be able to choose whether its data is sold to companies that provide software used to recruit its agents.”
The spokesperson did not confirm whether Compass’ company-owned brokerages use any of the platforms.
While CRMLS did not receive Compass’ Sept. 23 letter directly, Carter said three smaller MLS organizations whose operations CRMLS had taken over received the correspondence and forwarded it to him. CRMLS did not formally respond to the recruiting-data demand.
In an Oct. 27 amended complaint filed in New York, CRMLS and OneKey MLS cited Compass’ recruiting-data demands as another example of what they allege is the company’s effort to benefit from information shared by competing brokerages without providing the same access in return.
Compass makes the opposite argument in its California lawsuit, alleging that CRMLS requires agents to contribute valuable listing information and then sells it to companies whose products help recruit those same agents away.
The two sides disagree over who should control that information and how it can be used. Compass confirmed to Inman that its Sept. 23 demands remain in effect but said no MLSs have agreed to stop selling its data to recruiting software companies.
But DelPrete had another perspective on how Compass’ disputes are playing out.
“If Compass’ goal is to be in the news a lot — mission accomplished,” he said.
