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Defamation and deletions: Legal battle between Zillow, Move rages on

Countersuits and motions continue as discovery proceeds

The ongoing legal battle between Zillow Group (Z) and Move (MOVE) over accusations of theft of trade secrets and unfair competition continues, with new allegations and counterclaims of defamation, destruction or hiding of evidence, and more.

The judge in the case, King County Superior Court Judge John Chun, ordered senior Zillow employee Curt Beardsley and an expert witness hired by Zillow to sit for additional depositions in the case as part of the ongoing discovery phase. Chun also ordered Beardsley to refrain from file deletion or the discarding of potential evidence.

“We believe Move’s claims are entirely without merit and we intend to vigorously defend against the allegations set forth in their complaint,” said Amanda Woolley, spokesperson for Zillow.

The order from the judge stems from allegations by Move that Beardsley deleted files from Zillow accounts that may be related to the case.

Move and NAR have petitioned the court for additional access to Zillow’s computers and cloud storage accounts for the purposes of a forensic review.

It all started when Move and the National Association of Realtors filed suit against Zillow on March 17, 2014, after Errol Samuelson, then Move's chief strategy officer, resigned from Move on March 5, 2014, and joined Zillow as the company's second-highest paid executive on the same day.

Move alleged that Samuelson and Zillow stole trade secrets and proprietary information, and that they have made efforts since to cover that up. Move further alleges that Zillow has been hiding or deleting evidence.

Zillow denies the allegations and in late August the company countersued Move and the National Association of Realtors for defamation.

“As we have stated, Move's litigation filing of a purported 'anonymous letter,' which was a mix of false, misleading information and confidential business information, was a clear attempt to discredit, disparage and damage Zillow publicly and competitively,” Woolley said. “We have taken appropriate legal action to address this situation based on the facts. We will not be commenting any further on this matter.”

NAR last week filed a motion to dismiss the counterclaims by Zillow regarding the defamation charges.

A spokesperson for Move declined to comment.

The countersuit stems from an anonymous whistleblower letter Move and NAR received in April, since revealed to have come from former Zillow Vice President of Strategic Partnerships Chris Crocker.

Crocker claimed that Zillow stole proprietary intellectual property from and accused Samuelson of violating court order limiting his work. The letter is also the source of the charge that Zillow is hiding evidence on its computers or cloud accounts.

That letter has since been struck from the record by the judge.

The Zillow trial is scheduled for June 2016. Discovery in the case continues.

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