Zillow is facing renewed claims of Real Estate Settlement Procedures Act (RESPA) violations thanks to a third amended complaint in the combined Taylor and Armstrong lawsuit.
The plaintiffs filed this amended complaint on Monday after Judge James Robart granted Zillow’s motion to dismiss the suit in late July. Judge Robart gave the plaintiffs the opportunity to file an amended complaint if they wished to proceed with their claims.
Originally filed in mid-September 2025, the lawsuit claims that the portal tricks consumers into using agents affiliated with Zillow through its Flex and Premier Agent programs, resulting in inflated home purchase prices. In an amended complaint filed in mid-November, plaintiff Alucard Taylor also alleged that Zillow violated the Racketeer Influenced and Corrupt Organizations (RICO) Act by pushing homebuyers to apply to more costly loans that do not serve their best interests.
In December 2025, the lawsuit was consolidated with a second suit known as the Armstrong suit, which was first filed in early November, claiming that Zillow pressures agents in its Premier Agent and Flex lead programs to steer buyers to Zillow Home Loans for their purchase mortgage pre-approval. Allegedly, agents who send more clients to Zillow’s mortgage arm for their pre-approvals received extra or higher-quality leads in exchange.
In a first amended complaint, the plaintiffs again claimed that Zillow tricks consumers into using agents affiliated with Zillow through its Flex and Premier Agent programs, resulting in inflated home purchase prices. The complaint also added Real and The Frano Team as defendants.
In a second amended complaint filed in April, the plaintiffs added eXp Realty as a defendant, accusing it of supporting Zillow’s “fraudulent business enterprise” by allegedly steering clients to Zillow Home Loans for their financing needs.
A narrower set of claims
The most recent complaint contains a much narrower set of claims and it reduced the number of named plaintiffs from 12 to five: Araba Armstrong, David Liao, Furgus Wilson, Brandon Daugherty and Rebecca Robbins. Only Armstrong and Liao carried over from the previous lineup. Alucard Taylor — whose name has effectively become synonymous with the lawsuit — is no longer a named plaintiff.
In this third amended complaint, the plaintiffs again allege that Zillow required agents participating in its Preferred and Flex programs to steer homebuyers toward Zillow Home Loans in exchange for receiving valuable buyer leads. They claim this undisclosed arrangement violated RESPA by effectively providing agents with something of value — leads — in exchange for mortgage referrals, while also causing consumers to lose access to potentially cheaper or more suitable loan options.
The plaintiffs further allege that Zillow’s steering resulted in consumers paying higher mortgage costs and point to an economic study estimating that ZHL borrowers paid roughly $2,881 more per comparable loan, or about $31.6 million in aggregate additional costs during the period studied. They also claim Zillow’s conduct violated the Washington Consumer Protection Act, but unlike earlier complaints there are no claims of RICO violations.
The plaintiffs are seeking damages, including treble damages under RESPA, as well as injunctive relief and disgorgement.
In a post on its Front Porch blog, Zillow said it “believes this new complaint still has no merit.”
“Three weeks ago, a federal court dismissed every one of the plaintiffs’ claims. That ruling reflected what we have maintained throughout this litigation: the tools we offer buyers are free, transparent and optional, and claims to the contrary were baseless,” the post states. “Nothing about plaintiffs’ latest amended complaint changes the facts, the law, or how Zillow operates. We remain confident in our position as we vigorously defend ourselves in court.”
Other defendants in the Taylor suit, The Real Brokerage and the Real-brokered The Frano Team, were both voluntarily dismissed from the lawsuit earlier this year. Additionally, GK Properties was dismissed as the claims made against it were time-barred. The claims against eXp are still pending.