Algorithmic Pricing Decisions Have Favored Defendants, but the Law Will Continue to Evolve in 2026

Key Points

• In 2025, courts in antitrust cases delivered important victories to pricing software vendors and users, but the law in this area continues to evolve.
• Antitrust enforcers reached new settlements that helped clarify their views of pricing software.
• New state and local laws continue to shape the algorithmic pricing landscape.

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Businesses increasingly turn to algorithms to inform their pricing strategies, and courts, antitrust enforcers and legislatures are moving rapidly to grapple with legal and policy implications. Several significant developments in 2025 helped clarify this evolving landscape.¹

Algorithmic Pricing in the Courts

In the first appellate decision to address algorithmic pricing software, a unanimous U.S. Court of Appeals for the Ninth Circuit panel held in Gibson v. Cendyn Group that competing Las Vegas hotels did not run afoul of antitrust laws by licensing such software from the same third-party vendor.

Gibson plaintiffs — a putative class of hotel guests — had initially alleged a horizontal conspiracy among the software users but dropped that theory on appeal, challenging only each hotel’s license with the software vendor.

The Department of Justice (DOJ) participated in the appeal on the plaintiffs’ side. But the Ninth Circuit affirmed dismissal of the case, ruling that licensing software that makes nonbinding pricing recommendations is not a “restraint of trade,” at least when the recommendations are not alleged to rely on competitively sensitive information from competitors.

The U.S. Court of Appeals for the Third Circuit is considering an appeal from the dismissal of another case challenging the use of the same software by Atlantic City hotels.

While these cases foundered on the pleadings, other algorithmic pricing litigation — including several private cases and enforcement actions involving pricing of apartment rentals — have reached discovery.

In one such case, Mach v. Yardi Systems, Inc., a California state court granted summary judgment to the defendants, concluding that the software’s functionality did not breach state antitrust and unfair competition laws because it did not commingle nonpublic competitor data to suggest prices. Still, most algorithmic pricing cases that reached discovery remain pending.

DOJ Resolutions

The federal government also clarified its views of algorithmic pricing in 2025 by reaching proposed resolutions of its claims against RealPage, a prominent software vendor for apartment rentals, and Greystar, a large property manager.

The settlements, which await approval by a federal court in North Carolina, offer a valuable road map for software vendors and their licensees to reduce antitrust risk. These safeguards include using only public data, eliminating price floors, and not requiring or encouraging acceptance of prices proposed by the algorithm.

Emerging State and Local Laws

Even as private plaintiffs and government enforcers challenged algorithmic pricing in housing markets, a host of state and local legislatures opened another front by enacting various statutes and ordinances purporting to curb the use of third-party algorithms in setting apartment rents. Some of these laws were themselves challenged in court.

In at least two large states, the new laws reached beyond rental housing and sought to address use of algorithms generally. California has supplemented its state antitrust statute with provisions addressing algorithms. And New York required a conspicuous disclosure when prices are set by an algorithm using an individual consumer’s data. That law recently survived a First Amendment challenge.

For more on state antitrust scrutiny, see “Corporate Compliance Remains Critical as State Enforcement Initiatives Gain Momentum Following Governors’ Races.”

What’s to Come

While the legal landscape governing algorithmic pricing evolved substantially in 2025, we expect further significant developments in the coming year.

• A number of courts are poised to opine on algorithmic pricing topics, be it on the pleadings, at summary judgment or in the context of class certification.
• Federal and state enforcers may further elaborate on their views of algorithmic pricing in speeches, amicus briefs and enforcement actions.
• States and localities continue to enact new laws concerning algorithm use, and many of them differ in subtle ways that may themselves spawn litigation and important interpretive questions.

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1 Skadden has been at the forefront of many of the developments discussed in this article, including representing Caesars Entertainment in the Las Vegas and Atlantic City litigations, and representing Greystar in its DOJ settlement and in a range of other disputes related to Greystar’s use of algorithmic pricing in multifamily housing.

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