Leading financial figure Jeremy Newman is heading up the group which seeks to recoup ‘excessive’ fees charged by the portal to agents.
Rightmove is facing fresh pressure over its fees after an ‘imminent’ group legal action was today launched to represent estate agents seeking to recoup what it calls “excessive and unfair fees’”
This legal action is being led by former Competition and Market Authority panel member Jeremy Newman (main image) and its action is being funded by City firm Innsworth Capital and supported by law firm Scott+Scott UK LLP and economists Kairos Economics.
£1bn compensation claim
The group says the amount of money it hopes to recoup on behalf of participating estate agents could reach £1 billion. It says any estate agent who has paid fees to Rightmove over the past six years are eligible to join the group, which will be on an ‘opt out’ basis.
Newman is an accountant by trade and a leading figure within the legal, charitable, housing, Government, open banking and financial worlds including spells as Deputy Chair of the Government Legal Department and Non-Executive Board member and Chair of the Audit Committee of the Crown Prosecution Service.
He says: “Rightmove knows that, due to its first-mover status, its product is considered a ‘must-have’ for estate agents.
“It exploits its dominance of the online property portal market in the UK to charge excessively and unfairly high subscription fees.”
“It exploits its dominance of the online property portal market in the UK to charge excessively and unfairly high subscription fees, both at face value and when compared with its competitors.
“Estate agents have had to absorb consistent, excessive price increases on a regular basis.
“My case will seek to return the overpaid fees to estate agents across the country and to rebalance the relationship between Rightmove and the estate agents that use its online property portal.”
Levelling the playing field
Ian Garrard, Managing Director of Innsworth Advisors says: “Jeremy’s claim is about levelling the playing field for businesses up and down the country, deterring anti-competitive behaviour and correcting the imbalance between big and small in the property sector.
“Without the opt-out collective actions regime, it would be much harder – or even impossible – for SMEs to seek redress for anti-competitive behaviour.
“As a result of Innsworth’s funding – and at a time of considerable uncertainty for the opt-out regime – businesses within the class will not have to pay a penny towards the claim.”
Agents want more information should contact the group via email.
Rightmove says: “Rightmove notes press articles relating to a potential claim against Rightmove. Rightmove has received notice of a potential claim.
“We’re confident in the value we provide to our partners. Further updates will be provided as appropriate.”
Industry reaction
Anthony Codling, RBC Capital Markets
“The fact that estate agents don’t like paying fees to Rightmove is hardly breaking news. Are the fees uncompetitively too high? Fees are in the eye of the beholder. Is a business class flight from London Heathrow to JFK too expensive?.” he says.
“For many of us yes, but cheaper seats are available that get you to the same destination on the same plane at the same time. Some willingly choose to turn left and the rest of us turn right.
“Rightmove offers a range of packages to its customers, and they choose which to pay for. They balance the return on investment – if I spend a few pounds more will I make a greater return (win more instructions or make efficiency gains which justify the costs)? Just like asking prices for houses, if the price is too high, make a lower offer or buy another house. Very few of us choose to sue the supplier.”