Zillow to pay $212.5M settlement in iBuying class action

Zillow has agreed to pay $212.5 million to resolve a securities class action lawsuit claiming investors were misled about the risks and performance of its shuttered Zillow Offers iBuying business, according to a document filed with the Securities and Exchange Commission (SEC) on Wednesday. The cash settlement, outlined in a stipulation of settlement filed on Tuesday, will resolve all claims against all defendants in the consolidated Jaeger lawsuit. Originally filed in mid-November 2021 in the U.S. District Court for the Western District of Washington after Zillow shuttered its iBuying operations Zillow Offers, the suit claims that following the expansion of Zillow Offers, Zillow and certain executives made material misstatements and omissions about the unit’s home-purchase volumes, pricing accuracy and operational improvements, which allegedly inflated Zillow’s stock price. According to the complaint, Zillow’s share price fell after the company announced on Nov. 2, 2021, that it would wind down Zillow Offers due to “unpredictability in forecasting home prices,” cut its workforce by 25% and take a $304 million write-down on homes purchased in the third quarter of 2021. Zillow also t...