Real Estate

California court dismisses a $60 million lawsuit against Zillow

Claim stemmed from 2019 hack of $150 million listing

A U.S. District Court judge on Tuesday dismissed a lawsuit against Zillow alleging damages stemming from the unauthorized access of a listing.

An LLC that owned a 12-bedroom luxury home in the Los Angeles neighborhood of Bel-Air sued Zillow in February 2019 claiming $60 million in damages after a hacker accessed the account and falsified information to make the property seem less desirable.

At the time, the home was listed for sale at $150 million, according to the background information contained in the judge’s decision.

Judge Otis D. Wright II dismissed the suit on the grounds it was barred by Section 230 of the Communications Decency Act. That’s contained in a 1996 law that allows companies like Facebook or Zillow to be treated as distributors of information, akin to bookstores, rather than publishers.

Detractors, including many in Congress from both sides of the aisle, have blasted Section 230 for providing companies with broad immunity when their platforms are used to spread of false information, as happened during the 2016 presidential election. Others see the law as the reason the internet has flourished.

“Reviewing each user’s activity and postings to ensure their accuracy is precisely the kind of activity for which Congress intended section 230 to provide immunity,” the decision said.

According to the suit, the hacker was able to get past Zillow’s security questions to gain control of the listing. The plaintiffs also alleged that Zillow ignored repeated requests over the course of a week from the seller’s attorneys to block the hacker’s access and claimed that Zillow did not have appropriate safeguards in place.

After being contacted by the owner, Zillow blocked the IP address used to make the unauthorized changes, according to information in the judge’s order. Later, when another user tried to do the same, Zillow contacted the LLC to determine if it was a valid request and when it was informed it wasn’t, it blocked that user.

“We are pleased the court dismissed the claims in this lawsuit,” Viet Shelton, a Zillow spokesperson told HousingWire. “Zillow strives for accuracy in the data published on our site and that is why we encourage homeowners to contact us to update their home facts.”

Attempts to reach the owner of the LLC, which has since sold the property, were unsuccessful.

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