Maryland Attorney General Anthony Brown is the latest top legal officer to sue RealPage, a commercial software platform, for using an algorithm to inflate rent prices.

Six Maryland landlords also are named as plaintiffs: Morgan Properties Management Company, LLC; Bozzuto Management Company; Greystar Management Services, LLC; AvalonBay Communities, Inc.; UDR, Inc.; and Highmark Residential LLC. All are accused of colluding with RealPage to use and share “competitively sensitive” data to fix prices, with the attorney general’s office even blasting the defendants as a “cartel” in legal filings.

The suit follows a remarkably similar one refiled last week by the U.S. Department of Justice. That suit, co-signed by 10 states and commonwealths, asserts that RealPage worked closely and frequently with rental companies to jack up rents and minimize free-market competition.

For example, Brown’s office said in court records, RealPage’s clients would share occupancy rates, how many prospects visited a competitor each week and how many new leases were signed. With that information, RealPage and its clients could estimate supply and demand and then generate a price for renting that maximizes each of their revenues.

“This is a high-tech way of achieving a classically anticompetitive (and unlawful) result: agreeing not to undercut the prices of one’s competitors,” the lawsuit states.

In a Wednesday news release, Brown’s office accused the software vendor and rental companies of violating the state’s Antitrust Act, costing Marylanders millions. The named landlords operate more than 100,000 units combined across the state leaving residents little choice but to pay the inflated rent costs, according to the release.

RealPage has denied wrongdoing. In a statement posted on its website, company representatives said “false and misleading claims” have been printed in legal filings and in the media but did not provide further specificity. It defended its services as beneficial for the rental housing industry, saying RealPage makes it healthier and more efficient.

The software vendor charges rental companies a fee for access to its services, which includes proprietary data from other subscribers. With its algorithm, RealPage recommends rental rates, terms and other suggestions to its users and then “polices” adherence to those recommendations.

As one RealPage client once expressed about one of its products, “that’s classic price fixing,” according to the Maryland Attorney General’s lawsuit. It did not name the client.

The lawsuit alleges RealPage’s software has inflated rent revenues by an average of 2% to 7%. That means each apartment renter may have overpaid by thousands of dollars in the last few years alone, according to the attorney general’s office.

The company closely monitored compliance with its suggestions, the suit claims: If a lower-level employee, for example, failed to comply with specific guidance, RealPage would escalate the issue to the person’s managers.

In a statement responding to the DOJ’s lawsuit, Greystar, which runs apartment communities across the Baltimore metro area — including several in the city — said it would “vigorously defend” itself in the lawsuit and “has and will” conduct its business with integrity. The other five rental companies did not immediately respond to a request for comment. According to the lawsuit, all of the companies have used RealPage’s services for at least the past four years.

RealPage is the dominant provider of rent-setting software, the lawsuit alleges. It’s headquartered in Richardson, Texas, and was a public company from 2010 to 2020 until being purchased by private equity firm Thoma Bravo.

It offers a suite of products, according to legal documents, including property management software, sales and marketing services, tenant screening capabilities and revenue management applications and services. In legal filings, RealPage has been described as the “Big Tech” of multifamily rental housing.

In 2023, Washington, D.C. Attorney General Brian L. Schwalb filed a similar lawsuit against RealPage and 14 of the district’s most prolific residential landlords, including the Greenbelt-based Bozzuto, for using a pricing algorithm to inflate prices, saying they colluded “at a time when affordable housing in DC is increasingly scarce.”

The Maryland Attorney General’s suit worded it similarly: “Defendants’ anticompetitive agreement has exacerbated Maryland’s affordable housing crisis, forcing Maryland renters to overpay, month after month, for what is typically the single largest expense in their lives: rent.”