Move sues CoStar over alleged theft of trade secrets

Move Inc., the parent company of Realtor.com, is suing CoStar Group, the parent company of rival Homes.com, over the alleged theft of portal data and documents.

In a complaint filed on Tuesday in U.S. District Court in California, Move alleges that James Kaminsky, a former employee who now works for CoStar, stole trade secrets to help fuel the rapid growth of Homes.com.

“There is nothing wrong with lawful — even intense — competition,” the complaint states. “But competitors should never be allowed to cheat and steal to get ahead.”

Move alleges that Kaminsky accessed Realtor.com documents through June of this year without being detected, despite leaving the firm in January and joining CoStar in March. According to the complaint, Kaminsky accessed information from Realtor.com “at least 37 times after CoStar hired him,” violating federal and state computer fraud laws to do so.

The documents that Move claims Kaminsky accessed include information about content planned for Realtor.com; ideas for future stories; metrics showing user traffic; a list of contacts; lists of Realtor.com employees and their compensation; and other private business information.

Kaminsky worked for Realtor.com for nine years, heading up its news and insights group. He departed the firm in January and joined CoStar two months later, where he currently serves as an editor, according to his LinkedIn page. In the complaint, Move claims that in his new role, Kaminsky is leading a team of writers that are building a product similar to Realtor.com’s, which Move says is an integral part of Realtor.com’s marketing strategy.

“As he departed Move, Mr. Kaminsky stole confidential business information, sending it to his personal email account on the last day he had access to Move’s computer system. He established surreptitious, undetected ongoing access to allow himself (and, thus, CoStar) to spy on Move’s highly confidential documents stored on protected computer systems,” the complaint states. “Then, attempting to cover his tracks, Mr. Kaminsky deleted nearly a thousand files from his Move computer and wiped clean his entire browsing history before returning the device to Move.

“The goal, obviously, is to help CoStar unlawfully jumpstart the creation of a ‘monetization engine’ for CoStar by driving up website visitor numbers and increasing revenue and profits for CoStar,” the complaint continued.

This is the latest development in what has become a long-running feud between Homes.com and Realtor.com. The two have spent the past several months debating who holds the title of second-largest listing portal behind Zillow, with Realtor.com alleging that Homes.com’s claims that it is the No. 2 portal in terms of traffic and impressions are false.

The legal complaint reiterated many of these arguments.

“According to every independent third-party source Move can identify — such as Comscore, Nielsen, Similar Web, or SEM Rush — Realtor.com has for years been the second most-visited residential real estate listings website in the United States, behind Zillow and ahead of Redfin,” Move’s complaint states. “By every independent third-party measure, Homes.com is last among the top four.”

The firm is seeking damages and a jury trial.

“Realtor.com is attempting to divert attention from its business troubles by filing a baseless suit, rather than competing in the marketplace,” a CoStar spokesperson wrote in an email. “Move’s transparent tactics involve complaining about the actions of an employee who it let go months ago, and its pleading contains no factual allegations that CoStar engaged in any wrongdoing.  We look forward to prevailing in court.”