Five states’ attorneys general sued Zillow and Redfin, accusing them of anti-competitive practices in the online housing rental market. The lawsuit follows a similar one filed by the Federal Trade Commission. The AGs allege that a $100 million deal between the companies harmed competition and may raise costs for renters.

The lawsuit claims that the agreements violate antitrust laws and resulted in Redfin firing and rehiring employees in collaboration with Zillow. New York’s AG Letitia James stated that the deal could limit options for renters. Zillow, Redfin, and CoStar dominate the market, accounting for 85% of revenue.

The AGs seek an injunction against the companies’ alleged collusion and propose restructuring to maintain competition. Redfin denies the allegations, stating that partnering with Zillow allowed them to offer more rental listings and benefit apartment seekers. Zillow did not comment on the lawsuit, and both companies’ stocks dropped after the announcement.

The FTC also filed a complaint against Zillow and Redfin for a similar scheme, which the companies denied. Despite the legal challenges, Zillow and Redfin remain confident in their partnership.

Read more at CNBC: State AGs sue Zillow, Redfin for alleged antitrust violation