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Justice Dept. Unit Ends Probe of Homestore.com

July 17, 2001|From Times Staff and Wire Reports

The Justice Department said Monday that it had terminated a probe into possible anti-competitive business practices by Homestore.com Inc. without taking action against the Internet's largest single source of home-sale listings.

The agency's antitrust unit had been investigating the Thousand Oaks-based firm's business strategy, which includes exclusive contracts with many of the country's largest residential property listing services. The investigation had been underway since April 2000.

Company officials have repeatedly denied that the firm had engaged in anti-competitive practices.

"Obviously, we're extremely pleased by the department's decision to close this matter," said Homestore Chairman and Chief Executive Stuart Wolff.

Government investigators also had been reviewing certain Homestore agreements with New York-based Cendant Corp. In February, Homestore bought Cendant's Move.com unit for $900 million in stock, joining the top two residential real estate sites on the Internet.

Justice Department spokeswoman Gina Talamona declined to explain why the department had closed the investigation or whether the issue was still of concern to government regulators.

Industry officials have expressed worries over Homestore's contract with the National Assn. of Realtors, the industry's largest trade group. That contract and exclusive arrangements with local real estate boards nationwide may lock out other companies from the online property listing market, said industry observers.

Homestore has secured information on about 1.5 million homes for sale--or more than 90% of the nation's real estate listings--largely through its relationship with the National Assn. of Realtors.

Homestore shares fell $2.92 to close at $28.15 on Nasdaq.

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