Federal judge blocks New York's rent-setting software ban

Overview

Updated 1 hour ago

A federal judge in Manhattan blocked New York from enforcing its first-in-the-nation ban on algorithmic rent-setting software, ruling the law likely violates the First Amendment. The decision lets RealPage, the largest provider of such pricing tools, keep selling rent recommendations to landlords while the case proceeds.

Judge Valerie Caproni called the outcome a close call and said RealPage is only marginally likely to win. She left intact a separate provision targeting software that helps landlords coordinate prices, and she flagged that a law limited to non-public data could survive. The state can still enforce that narrower rule.

Why it matters

Landlords in New York can keep using algorithmic rent tools critics say inflate prices in the state's tightest housing markets.

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Key Indicators

§340-b(3)

Provision blocked

Judge Caproni enjoined the section that labels rent-setting based on software recommendations an unlawful agreement. The ban on facilitating landlord collusion remains in force.

Oct 30, 2026

Pretrial conference

The next hearing in RealPage v. James is set for 10 a.m. in the Southern District of New York.

27 pages

Length of opinion

Caproni's ruling denied New York's motion to dismiss and described the merits as a close call.

Voices

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People Involved

Valerie Caproni

US District Judge, Southern District of New York

Presiding over RealPage v. James

Letitia James

New York Attorney General

Defending the law; motion to dismiss denied

Brad Hoylman-Sigal

Manhattan Borough President; former New York State Senator

Organizations Involved

RealPage

Software Company

Plaintiff; won preliminary injunction

RealPage licenses revenue management software that recommends rental prices and lease terms to landlords.

Thoma Bravo

Private Equity Firm

Owner of RealPage

Thoma Bravo is the private equity firm that owns RealPage.

U.S. Department of Justice

Federal Agency

Settled antitrust case against RealPage

The Justice Department reached an antitrust settlement with RealPage over its rent-setting software.

New York State

Government

Defendant; law partially blocked

New York enacted the first state ban on algorithmic rent-setting software.

Timeline

October 2025 September 2026

6 events Latest: 3 days ago

Tap a bar to jump to that date

September 2026
Judge blocks New York rent-setting software ban
Latest Legal

Judge Caproni grants preliminary injunction on § 340-b(3), denies motion to dismiss, calls it a close call.
3 days ago
May 2026
DOJ enters final judgment against RealPage
Legal

Antitrust settlement finalized; RealPage to stop using non-public competitor data by November 15.
May 19th, 2026
January 2026
New York moves to dismiss
Legal

Attorney General Letitia James files a motion to dismiss RealPage's challenge.
January 9th, 2026
December 2025
RealPage moves for preliminary injunction
Legal

Company asks the court to block enforcement while the case proceeds.
December 5th, 2025
November 2025
RealPage sues New York
Legal

RealPage files suit two days after settling its DOJ antitrust case, arguing the law violates free speech.
November 26th, 2025
October 2025
New York signs nation's first rent-software ban
Legislation

Governor Kathy Hochul signs General Business Law § 340-b, banning algorithmic rent-setting tools.
October 16th, 2025

Scenarios

RealPage wins permanent injunction; New York law dies

Possible Resolves by Q2 2027

Discussed by: RealPage and its counsel; the judge's opinion notes the company has a plausible case

If RealPage prevails at trial, the statute's core provision is struck down as an unconstitutional restraint on commercial speech. Judge Caproni already signaled a narrower law limited to non-public data could survive, so a full victory would turn on whether New York can justify restricting recommendations based on public market information.

Appeals court overturns injunction; law takes effect

Unlikely Resolves by Q2 2027

Discussed by: New York Attorney General's office; the judge called RealPage only marginally likely to succeed

The Second Circuit could reverse, finding the law regulates conduct rather than speech, or that the state's housing affordability interest justifies the restriction. Caproni left that door open by noting a stronger record could sustain the law.

New York amends the law to target non-public data

Possible Resolves by Q2 2027

Discussed by: The American Counsel's analysis; the judge flagged this as a viable narrower measure

State lawmakers could rewrite § 340-b to limit the ban to software using non-public competitor data, aligning with RealPage's DOJ settlement and dodging the commercial speech problem the court identified.

Historical Context

3 moments from history that rhyme with this story — and how they unfolded.

June 1980

Central Hudson Gas & Electric v. Public Service Commission (1980)

The Supreme Court struck down New York's ban on utility advertising promoting electricity use, and established a four-part intermediate scrutiny test for commercial speech. The test requires the government to show a substantial interest, that the regulation directly advances it, and that it is not more extensive than necessary.

Then

The ruling allowed utilities to advertise again and gave courts a framework for weighing speech restrictions against state interests.

Now

The Central Hudson test became the default standard for commercial speech cases, including advertising, professional regulation, and now algorithmic pricing.

Why this matters now

Judge Caproni applied the Central Hudson framework to New York's rent-software ban, finding the law likely burdens protected commercial speech more than necessary.

April 2015

US v. Topkins (2015)

David Topkins, an Amazon marketplace seller, pleaded guilty to using pricing algorithms to fix the prices of posters sold online. It was the first criminal antitrust prosecution for algorithmic price fixing.

Then

Topkins agreed to pay a fine and cooperate, and the case established that using software to coordinate prices can be prosecuted as a conspiracy.

Now

The case set the precedent that algorithms could facilitate price fixing, leading to civil lawsuits against landlords using RealPage's software.

Why this matters now

The same algorithmic coordination concern drove the DOJ's case against RealPage and New York's law, which the judge ruled goes too far by punishing ordinary reliance on software recommendations.

November 2025 - May 2026

RealPage antitrust settlement (2025-2026)

The Justice Department reached a settlement with RealPage, whose revenue management software was accused of helping landlords coordinate rents. Final judgment was entered May 19, 2026; RealPage agreed to stop using non-public competitor data in its recommendations, effective November 15, 2026.

Then

RealPage faced new restrictions on its data use and agreed to comply before the November 15, 2026 effective date.

Now

The settlement defined the federal boundary for what algorithmic pricing tools can do, while leaving state regulation to vary.

Why this matters now

RealPage sued New York two days after reaching this settlement, creating parallel federal and state battles over the same software.