Proposed Consent Agreement In the Matter of CoreLogic, Inc. #00006

Submission Number:
00006
Commenter:
Shylah Alfonso
Organization:
Zillow, Inc. & Perkins Coie LLP
State:
Washington
Initiative Name:
Proposed Consent Agreement In the Matter of CoreLogic, Inc.
Matter Number:

131-0199

Zillow, Inc., submits the following comments in response to the FTC’s proposed CoreLogic, Inc., Consent Agreement; File No. 131-0199. Zillow requests that the consent agreement be revised to permit companies like Zillow, who entered into contracts with DataQuick prior to July 1, 2013, to terminate such contracts in order to switch to RealtyTrac at any time upon 180-days’ notice. This revision to the proposed consent agreement is necessary to alleviate harm to Zillow brought about solely by the proposed merger, to resolve an inequitable inconsistency between DataQuick customers that are and are not permitted to terminate their contracts, which has the effect of increasing the competitive harm to Zillow, and to enhance RealtyTrac’s emergence as a strong third competitor in the market. The consent agreement addresses anticompetitive effects resulting from CoreLogic’s proposed acquisition of certain assets and other interests from TPG VI Ontario 1 AIV L.P., including its DataQuick Information Systems, Inc. national real property public records bulk data business. As indicated in the proposed consent agreement, the purpose of the order is to restore to the market for national assessor and recorder bulk data a third competitor that will act independently of CoreLogic. RealtyTrac has been identified as the new market entrant to replace DataQuick as the third competitor. To that end, three categories of DataQuick customers are permitted to terminate their contracts in order to switch to RealtyTrac (referred to collectively as “Terminating DataQuick Customers”). Terminating DataQuick Customers are limited to DataQuick customers that: (1) renewed their DataQuick contract or switched to CoreLogic between July 1, 2013 and the acquisition date; (2) renewed or entered into a new contract with DataQuick during the first nine months following the acquisition; or (3) entered into a contract with DataQuick prior to the acquisition that expires on or after March 31, 2017. Zillow is a DataQuick customer. However, because Zillow entered into a renewal contract with DataQuick prior to July 1, 2013 that expires prior to March 31, 2017, Zillow does not fall within any of the three categories of Terminating DataQuick Customers. Zillow should be included within the Terminating DataQuick Customers to prevent merger-related harms to Zillow. As a result of the merger between CoreLogic and DataQuick, CoreLogic must now provide data and services to DataQuick customers. As the FTC recognized, DataQuick offered lower prices and less restrictive license terms than CoreLogic. In addition, Zillow agreed to a range of service and data levels under the contract with DataQuick given DataQuick’s competitive incentive was to perform at the top end of the range. Absent the merger, CoreLogic would not have acquired the DataQuick customers on terms it did not negotiate. Consequently, CoreLogic lacks incentive to provide the same level of data and services as previously provided by DataQuick--indeed CoreLogic’s incentive is to provide service and data levels at the bottom of the applicable range at best--regardless of whether such diminution of services or data is in breach of contract. Any incentive is further undermined by the fact that CoreLogic is insulated from competition for these customers until the contracts expire. For Zillow, that means nearly two years. Allowing Zillow to terminate the contract with 180-days’ notice would align post-acquisition incentives with pre-acquisition competitive incentives and alleviate harm to Zillow that is caused by the merger. [To be continued in additional comment due to space limitations]