Bryan Koenig
December 26, 2025
'Forthright' Yardi Source Code Production Beats Rent Suit
5 min
AI-made summary
- Yardi Systems Inc
- secured a summary judgment in a California state court, where Judge Michael M
- Markman ruled that Yardi’s software does not facilitate price-fixing among landlords, as its algorithm only uses each client’s own data
- The decision, which also cleared Manco Abbott Inc
- and Balaciano Group, is notable for relying on a review of Yardi’s source code
- Plaintiffs’ claims of antitrust violations were rejected due to lack of evidence of any agreement among landlords.
Yardi thinks it's found the right formula for beating antitrust litigation targeting algorithms allegedly used to fix prices for rental housing, hotel rooms and more, winning a California state court ruling the software company's attorneys say is the first to nix claims by looking at the source code itself.
Yardi Systems Inc.'s counsel at Debevoise & Plimpton LLP say Judge Michael M. Markman's summary judgment decision is one of the first on the merits of the bevy of algorithmic price-fixing cases from private plaintiffs and government enforcers targeting a range of software companies and their clients in the apartment and hospitality sectors. After Judge Markman entered final judgment Monday, they say his findings could serve as a bellwether for similar cases.
In granting summary judgment Oct. 6, the Alameda County judge specifically credited "Yardi's forthright decision to produce its source code and related evidence in the initial phases of discovery." He called it "critical" to looking at exactly how Yardi's customers use its software, not to set prices using sensitive information provided by their apartment rental rivals in a "give to get" information scheme, but "to use their own information for their own purposes."
"The undisputed evidence is that no one is agreeing or cooperating with the sharing of commercially sensitive rental prices in order to get price recommendations," Judge Markman said. "The owners/managers are not giving anything to their competitors through Yardi, and they are not getting a price recommendation that is based on pricing data provided to Yardi by their competitors."
Counsel for the plaintiffs declined to comment Wednesday.
Private plaintiffs have brought an array of algorithmic pricing cases against software companies and their customers, including the owners of large apartment complexes and major hotel chains. State and federal enforcers have also weighed in, including with a U.S. Department of Justice case centered on RealPage Inc. While some defendants have settled, others have beaten the private litigation arrayed against them on arguments that all they did was independently license the same software to get price recommendations they didn't have to follow, arguments similar to what played out in the instant case.
Yardi too is battling federal court litigation in Washington state, which a judge refused to toss last year. Judge Markman noted in his summary judgment decision, which also cleared Manco Abbott Inc. and Balaciano Group, that he rejected dismissal here "on similar grounds."
"Now missing on summary judgment, however, is any evidence 'that the lessor defendants agreed between and among themselves to provide their rental information to Yardi.' ... The information provided to the Revenue IQ system by landlords cannot be used by the system to generate price recommendations for other landlords," he said.
More sensitive information, he said, is collected by Yardi personnel cold-calling landlords and pretending to be prospective renters. That information, he said, "is taken from landlords without any agreement, not given to Yardi under any kind of horizontal or vertical agreement."
After surviving dismissal, Judge Markman said the plaintiffs shifted their arguments to asserting that it's enough to avoid summary judgment by saying Yardi's landlord customers accepted its invitation to adopt a common pricing algorithm.
"Plaintiffs' effort to pivot to a different legal theory is not supported by the law. Plaintiffs' first major problem is that a hub-and-spoke conspiracy, or other per se unlawful price-fixing activity, requires some anti-competitive agreement," he said.
Unlike major price-fixing litigation against pork producers, Judge Markman said that in the instant case, there's just a software license agreement between Yardi's hub and the landlord spokes. "There is no agreement, implicit or explicit, between any of the spokes. In other words, there is no rim," he said. And simply adopting a common software "itself is not an antitrust violation."
Yardi's attorneys at Debevoise hailed the ruling that they say shows courts are beginning to recognize legitimate uses of pricing software separate from potentially collusive applications.
In an interview with Law360, Debevoise's Maura K. Monaghan reiterated that Yardi's software simply does not enable users to employ their competitors' sensitive information to set prices. Instead of "a single pricing algorithm," she said the court recognized that Yardi merely offers a tool allowing each company to use its own data to meet its own objectives.
She also said the ruling signals that the federal court case against Yardi similarly "has no legs at this point," with the software company having similarly teed up its algorithm there in the hopes of a speedy win. The source code does what it does, Monaghan said, "and the software can only operate in the way its source code tells it to."
Debevoise's Abraham Tabaie in turn said that the case shows that pricing software can be used "in the right way. That's not anticompetitive."
Monaghan additionally suggested that the company's experience could provide an example for other firms willing to "put their product to the test" early in litigation — although that may depend on exactly how their algorithms and business models work, like if they offer more direct pricing controls across competitors. She was also critical of the plaintiffs' counsel for a "cut-and-paste approach" to litigation against algorithm-providers she called "unfair to Yardi" and a sign that the attorneys "are not doing their job"
Yardi is represented by Maura K. Monaghan, Michael Schaper, Abraham Tabaie and David Sarratt of Debevoise & Plimpton LLP.
The plaintiffs are represented by Adam J. Zapala, Elizabeth T. Castillo, Christian S. Ruano and Karin B. Swope of Cotchett Pitre & McCarthy LLP, Daniel E. Gustafson, Daniel C. Hedlund, Daniel J. Nordin, Shashi K. Gowda and Dennis Stewart of Gustafson Gluek PLLC, Kenneth A. Wexler, Justin N. Boley, Melinda J. Morales and Margaret Shadid of Wexler Boley & Elgersma LLP, Kevin S. Landau, Brett Cebulash and Gwendolyn Nelson of Taus Cebulash & Landau LLP and David M. Cialkowski, lan F. McFarland and Zachary J. Freese of Zimmerman Reed LLP.
The case is Victor Mach et al. v. Yardi Systems Inc. et al., case number 24-CV-063117, in the Superior Court of the State of California, County of Alameda.
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Bryan Koenig
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