$60M lawsuit alleges Zillow listings can be hijacked

Once called “the most expensive house in the US,” 924 Bel Air Road is a California jewel, crafted by famed homebuilder, Bruce Makowsky. And it’s currently on the market for a cool $150 million.

The only problem is, that according to Zillow, on February 04, it sold for $110M, there was an open house on February 08 that never existed, and although the errors were corrected by Zillow, the listing again was marked as sold on February 09 for $90.5M, corrected, and sold again the very next day for $94.3M.

The property owner is currently suing Zillow for $60M, alleging that the company “admittedly published false information, through its own website,” and “is disseminating misleading, false, and inaccurate information that has a large prominence because of Zillow’s market power.”

Further, the Plaintiff offers email evidence wherein Zillow acknowledged that they were “aware of the issue,” complaining that the false data was not immediately removed, rather took a week.

How did all of this happen?

A false claim of ownership.

Initially, a Chinese IP address with the email 910028863@qq.com (and a phone number whose area code does not exist) claimed the listing, and although Zillow requires a verification process, the lawsuit alleges that anyone that attempts to claim the property enough times can anticipate the questions “and be able to figure out what information they need to verify their identity.”

Later, on February 14th, “andersgraff@icloud.com” attempted to alter sales information. It is not immediately clear to us if this email address is associated with the previous claim, faked, or if multiple individuals have attempted to claim the address. Zillow’s policy is to notify the original party claiming a listing if there is a dispute, so “andersgraff” could be the original user’s second attempt. Or not.

They allege that Zillow does not have any safeguards in place, and that they “knew or should have known that trolls, criminals, and persons illegally claiming ownership of property and falsely contending it was sold that could easily bypass their standard questions to ‘claim a home’ and post false information.”

“It was reasonably foreseeable that this would happen,” the lawsuit alleges. “Yet, the Defendants have done nothing about it and simply do not care about the homeowners they hurt in the process.”

That last bit is a little floral, but their point is taken.

So what is the solution here?

Zillow has always allowed homeowners to claim their address, update information to improve accuracy of the data, and correct any information; it has been part of the differentiator between them and their competitors.

Zillow Corporate Counsel, Kim Nielsen emailed the Plaintiff’s attorney, Ronald Richards on February 14th, “Unfortunately, if someone is able to provide responses to the verification questions, they are able to claim the home. As I mentioned, we do not manually check each time someone attempts to claim a home. One suggestion would be for the listing agent or company selling the home to go in and claim the home until it is sold. This will at least prevent someone else from being able to fraudulently claim ownership of the home.”

Couldn’t that in itself be seen as a fraudulent claim of ownership if the agent claims the property as their own?

This lawsuit highlights a massive challenge to Zillow’s data, revealing that it can, in fact, be manipulated. With a fake email address and Chinese IP address. Can any user game the system to impact local markets?

For the lawsuit, read here; for the exhibits, read here.