Things are ramping up in the legal battle between Move Inc. (the parent company of Realtor.com), CoStar Group (the parent of Realtor.com rival Homes.com), and James Kaminsky, a former Realtor.com employee who now works for Homes.com.
A U.S. district court in Los Angeles has granted CoStar’s ex parte motion for expedited discovery in regard to Move’s motion for a preliminary injunction.
Filed in early July, the suit alleges that Kaminsky stole trade secrets to help fuel the rapid growth of Homes.com. In mid-July, Move filed a motion for a preliminary injunction “restraining and enjoining Defendants CoStar Group, Inc. and James Kaminsky from any further unauthorized access of the following Move-owned files, and from any use or disclosure of Move’s confidential and trade secret information contained in the files.”
Move asked the court to grant its preliminary injunction without any discovery, prompting CoStar to file its ex parte motion.
According to CoStar, the motivation behind its ex parte request for expedited discovery was to “uncover the facts,” noting that it would “allow the parties to submit fulsome briefing to the Court with evidence and testimony regarding the trade secrets claimed by Move, the alleged acts of Mr. Kaminsky, his work for CoStar, how Move has allegedly been harmed, and the urgency and alleged irreparable nature of any such harm, all of which will give the Court the benefit of a comprehensive record on the issues presented in the Motion.”
“Move has flatly rejected Defendants’ proposal to allow for such discovery even though it asked for certain expedited discovery as part of its Motion,” CoStar’s ex parte filing stated. “It is telling that Move shows no interest in quickly discovering, in advance of the preliminary injunction hearing, the truth regarding the Defendants’ alleged conduct, and is unwilling to reveal the facts about its own investigation, the timing thereof, the supposed trade secret nature of the documents at issue, and Move’s basis for claiming that such documents were used to compete against it.”
On Monday, Judge George H. Wu granted the motion, noting in the court docket that the parties are to “meet and confer re discovery issues, and if any issues are unresolved, file a joint brief by no later than August 5, 2024.”
Additionally, the hearing related to Move’s motion for a preliminary injunction is slated to continue on Sept. 23, 2024.
“We are delighted that the Court rejected Move’s attempt to obtain an injunction without discovery, and granted CoStar’s request for discovery from Move, and for a hearing in September,” Gene Boxer, CoStar Group’s general counsel, wrote in an email to HousingWire. “We have said all along that Move’s case is a PR stunt, and Move’s attempt to hide the facts was in line with that. We look forward to holding Move to account.”
Since Move filed for its preliminary injunction, CoStar has revealed that it has placed Kaminsky on paid leave, and in a filing on July 25, Kaminsky denied wrongdoing.
In the filing, Kaminsky notes that he is a content editor who was hired by Move in June 2015 to build a news division at the company with the “goals of driving Internet traffic to the Realtor.com website, increasing consumer brand recognition to Realtor.com, and increasing opportunities for monetization through advertising for Realtor.com.”
Kaminsky said he was informed he was part of round of layoffs at Move on Jan. 10, 2024, and that Jan. 12 was the final day he was allowed to come into the office or work from home. Due to the layoff, Kaminsky said he downloaded personal financial documents such as paystubs and W-2 forms, as well as his recent performance reviews and thank-you notes from staff, as he wanted to have access to these things for personal, tax and financial reasons.
“I had many other personal files on my Move-issued computer. Many were highly sensitive documents about services for my children, or medical assessments which my wife would send to me to print out at the office, since, for years, we did not have a reliable at-home printer. I also had emails containing my credit card information,” Kaminsky wrote in his declaration.
“Before leaving Move and ultimately returning my laptop computer to Move, I did not have time to carefully prune the selection of emails that I wanted to delete for personal privacy purposes, so I erased the majority of my emails and electronic files to prevent them from being seen by the technology personnel who would be processing my computer return.”
Kaminsky wrote that he deleted these emails and files not to destroy evidence, as Move has claimed in its preliminary injunction, but as an act of “basic privacy hygiene.”
In addition to the personal and financial documents Kaminsky sent himself from his Move account, he wrote that he also gave himself what he “considered to be temporary access to some of the documents [he] thought might be helpful for a job search.” According to the filing, this included articles and documents he had authored or overseen during his time at Move.
“On January 11th and 12th, I sent myself links to most of these documents without carefully refamiliarizing myself with them,” Kaminsky wrote. “I had no interest in saving these documents, sharing these documents, or using those documents for any reason beyond short term help in generating job hunting materials for myself. I gave myself what I assumed would be temporary access to them in the most transparent and public way I know: literally putting my name on them.”
Kaminsky noted in his filing that the system was not completely secure, given the fact that he was able to grant permission to his personal email rather than a Move email address, which suggests “that the documents were and are not highly significant proprietary documents.”
“The documents did not in my view contain highly sensitive materials. Many were documents I had authored myself and all were those I had seen at Move. To the extent they contained information relating to my job as head of “News & Insights” I was already knowledgeable about that information from my 8.5 years at Move,” he wrote.
In an emailed comment, a Realtor.com spokesperson wrote that the suit’s most recent filings “only bolster [Move’s] case.”
“Costar’s employee, Jim Kaminsky, has admitted under oath to accessing and deleting many of Move’s electronic files, confirming our allegations,” the spokesperson wrote in an email. “Although CoStar initially denied any wrongdoing, they have put their employee on leave. The judge stated that if Kaminsky has accessed our confidential files, ‘he has done something that is clearly improper, and it seems to me they have some evidence of that, which is somewhat problematic.’ We couldn’t agree more.”
Ethan Brown, the managing partner at Brown Neri Smith & Khan LLP and Kaminsky’s attorney, said he and his client are pleased with the court’s decision.
“My client has explained his actions at length, and under oath. It’s plain that he is being used by Move as a pawn to attack CoStar. Given his personal circumstances—he was let go by Move after years of exemplary and highly successful service, while being the sole breadwinner of his family of four—Move’s decision to smear Mr. Kaminsky is inexcusable. Move is well aware that his new job at CoStar has nothing to do with his role at Move, and there is no evidence—nor could there be—that CoStar or Mr. Kaminsky used any Move confidential information to compete against Move,” Brown wrote in an email. “Mr. Kaminsky is a sacrificial lamb, treated as mere collateral damage in Move’s attempt to hit back at a competitor. If Move has any real concerns regarding Mr. Kaminsky’s actions they would have quickly been resolved if they had just picked up the phone and called him to discuss what he did and why he did it. Move, and its CEO, are directly responsible for the significant personal and reputational damage they have caused Mr. Kaminsky, who has a spotless, decades-long career of high-level media positions, through the pursuit of this unnecessary legal action.”
The suit is the latest development in what has become a long-running feud between Homes.com and Realtor.com. The companies have spent the past several months debating who holds the title of second-largest listing portal behind Zillow, with Realtor.com alleging that Homes.com’s claims that it is the No. 2 portal in terms of traffic and impressions are false.
