Home / Business and Economy / Zillow Settles Shareholder Lawsuit for $212.5M
Zillow Settles Shareholder Lawsuit for $212.5M
29 Oct
Summary
- Zillow will pay $212.5 million to settle a shareholder lawsuit.
- The lawsuit accused Zillow of misleading investors about its home-flipping venture.
- The settlement comes after the Supreme Court refused to hear Zillow's appeal.
Online real estate marketplace Zillow has agreed to pay $212.5 million in cash to settle a class action lawsuit. This legal action accused the company of misleading shareholders about its unsuccessful Zillow Offers home-flipping initiative.
Zillow announced this settlement on October 28, 2026, over three weeks after the US Supreme Court chose not to hear its appeal. The lawsuit was initiated following a significant 32% drop in Zillow's stock price in November 2021. This decline occurred after reports emerged that most homes in the Zillow Offers inventory were valued less than the company's purchase price.
Consequently, Zillow decided to close Zillow Offers, record a $304 million writedown, and lay off 25% of its workforce. Shareholders alleged they were defrauded into buying Zillow shares at inflated prices due to overly optimistic portrayals of the venture by company leadership. Lawyers representing Zillow denied the accusations of securities fraud. The company stated that insurance would cover approximately $48 million of the settlement payout, with a portion allocated to the shareholders' legal fees.
