Compass Preliminary Injunction Filing, Goes Full Monty

Compass tells the world its side of the story... and drops a potential bombshell

I was already planning on writing this post this week, when Zillow dropped its responses. However, as I began writing on those responses—which are revealing as to what Zillow’s strategy will be—I realized that I never wrote the post looking at Compass’s motion for preliminary injunction.

Because I didn’t have the time; Compass filed that on Friday. Zillow sent its responses over the weekend. Some lawyers were burning the midnight oil over the weekend, for sure.

So… let’s consider this Part 1 on looking at the preliminary injunction fight. Part 2 will be on Zillow’s responses.

Basically, Compass is asking the court to stop Zillow from implementing ZLAS right now, before a trial, before real motion practice, before a whole lot has happened. This is… unusual, of course. And difficult to get from a judge.

The legal standard for preliminary injunction is fairly high. After all, you’re asking the court to impose something on the other guy without a lot of actual discovery, without arguing before the judge, letting the other guy keep doing what he’s doing will result in really bad things happening. This is one of those emergency brake type of things, and courts are leery of granting PI as a general matter.

So, a preliminary injunction typically requires (thanks Grok!):

• Likelihood of Success on the Merits: The moving party must show a strong likelihood of winning the case based on the law and facts. Courts assess whether the movant's legal claims are likely to prevail once the case is fully litigated.

• Irreparable Harm: The movant must demonstrate that they will suffer irreparable harm—meaning harm that cannot be adequately compensated by monetary damages or other remedies—if the injunction is not granted. This often involves showing immediate or imminent injury.

• Balance of Hardships: The court weighs the harm to the movant if the injunction is denied against the harm to the opposing party if it is granted. The movant must show that the balance tips in their favor, meaning their harm outweighs any burden on the defendant.

• Public Interest: The court considers whether granting the injunction serves the public interest or, conversely, whether it would cause public harm. This factor is particularly relevant in cases involving public policy, safety, or economic issues.

It goes without saying that Compass argues that it has met all four factors, and therefore, the court should issue the PI. It goes without saying that Zillow will (and has, as of this writing) argue otherwise.

So let’s at least get into what Compass argues in its motion. Most of what is interesting is in the stories that Compass tells about how and why things got to this point, how important off-MLS marketing is to them, and the harm they would suffer if ZLAS is allowed to go forward. Plus, there is one absolute bombshell of a revelation in a Declaration. If true, that revelation is immensely, critically, and unquestionably huge for the entire industry.

As always, I am not your lawyer and none of this is legal advice. Please consult your own attorney for actual legal advice. This is strictly educational entertainment, and I am analyzing this from the industry’s point of view.

Let’s get into it.