A Settlement That Could Reshape the Market

On September 26, 2025, FPI Management agreed to a $2.8 million settlement in a class action lawsuit accusing it, alongside other landlords and Yardi Systems, of inflating rents through algorithm-driven pricing. While denying wrongdoing, FPI became the first defendant to settle and accepted three years of restrictions on certain revenue management tools. The company also agreed to cooperate with plaintiffs, handing over evidence that could strengthen the case against other landlords and Yardi itself.

Why This Case Stands Out

At the heart of the lawsuit is Duffy v. Yardi Systems, where tenants allege that landlords shared confidential data through Yardi’s software to coordinate higher rents. Historically, courts reviewed such claims under the “rule of reason,” requiring detailed proof of competitive harm. But Judge Robert Lasnik applied a per se approach, treating the alleged conduct as inherently unlawful price fixing. This shift lowers the burden for plaintiffs and signals that algorithmic coordination could be treated the same as traditional collusion.

The Legal Landscape: Unsettled and Evolving

The case aligns with the DOJ’s growing stance that algorithmic coordination is inherently suspect, even if landlords retain discretion to override recommendations. Still, the picture is far from consistent. Other courts have applied stricter standards, and the Ninth Circuit has taken a more cautious view in cases like Gibson v. Cendyn, emphasizing the need for proof that a tool directly restrained competition. The result is legal uncertainty, with potential splits across jurisdictions until higher courts weigh in.

Implications for Property Managers and Vendors

1. Lower Bar for Lawsuits: Plaintiffs may succeed with fewer economic studies, relying instead on evidence of shared data or parallel use of pricing tools.

2. Rising Risks for Vendors: Software developers like Yardi and RealPage face pressure to show their systems do not facilitate collusion.

3. Scrutiny on Black-Box Models: Tools that use competitor data or operate without transparency could draw regulatory and legal fire.

4. Regulatory Spotlight: Antitrust authorities are already engaged and may push for broader oversight.

5. Beyond Real Estate: The logic of these cases could extend into hotels, airlines, ride-sharing, and e-commerce.

Challenges and Open Questions

• Allegations Are Not Proof: FPI’s settlement does not confirm collusion; it simply avoids a protracted legal battle.

• Debate Over Standards: Courts remain split between per se treatment and rule of reason analysis.

• Parallel Adoption vs. Collusion: Using the same tool may not equal conspiracy, and defendants are likely to argue that market forces explain pricing.

• Appeals Loom: Conflicting rulings could push these issues to appellate courts or the Supreme Court.

What Property Professionals Should Do Now

• Audit Your Use of Pricing Software: Especially if it pools competitor data.

• Document Independence: Keep records of decisions that override or deviate from algorithmic suggestions.

• Demand Transparency: Ask vendors how their systems work, what inputs they use, and whether they enforce uniformity.

• Monitor Industry Trends: Expect similar scrutiny across other sectors that rely on algorithmic pricing.

Conclusion

The FPI / Yardi settlement is more than just a financial resolution. It highlights a turning point in how courts and regulators view algorithmic pricing. For landlords, property managers, and tech providers, the message is clear: greater transparency, independence, and caution are no longer optional—they are becoming essential safeguards in an evolving antitrust landscape.