Opendoor Labs Inc; Analysis of Proposed Consent Order To Aid Public Comment, 48480-48481 [2022-17077]

Agencies

• FEDERAL TRADE COMMISSION

[Federal Register Volume 87, Number 152 (Tuesday, August 9, 2022)]
[Notices]
[Pages 48480-48481]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-17077]


-----------------------------------------------------------------------

FEDERAL TRADE COMMISSION

[File No. 192 3191]


Opendoor Labs Inc; Analysis of Proposed Consent Order To Aid 
Public Comment

AGENCY: Federal Trade Commission.

ACTION: Proposed consent agreement; request for comment.

-----------------------------------------------------------------------

SUMMARY: The consent agreement in this matter settles alleged 
violations of federal law prohibiting unfair or deceptive acts or 
practices. The attached Analysis of Proposed Consent Order To Aid 
Public Comment describes both the allegations in the draft complaint 
and the terms of the consent order--embodied in the consent agreement--
that would settle these allegations.

DATES: Comments must be received on or before September 8, 2022.

ADDRESSES: Interested parties may file comments online or on paper by 
following the instructions in the Request for Comment part of the 
SUPPLEMENTARY INFORMATION section below. Please write ``Opendoor Labs 
Inc.; File No. 192 3191'' on your comment and file your comment online 
at https://www.regulations.gov by following the instructions on the 
web-based form. If you prefer to file your comment on paper, mail your 
comment to the following address: Federal Trade Commission, Office of 
the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex D), 
Washington, DC 20580, or deliver your comment to the following address: 
Federal Trade Commission, Office of the Secretary, Constitution Center, 
400 7th Street SW, 5th Floor, Suite 5610 (Annex D), Washington, DC 
20024.

FOR FURTHER INFORMATION CONTACT: Matthew Wilshire (214-979-9362), 
Bureau of Consumer Protection, Federal Trade Commission, 600 
Pennsylvania Avenue NW, Washington, DC 20580.

SUPPLEMENTARY INFORMATION: Pursuant to section 6(f) of the Federal 
Trade Commission Act, 15 U.S.C. 46(f), and FTC Rule 2.34, 16 CFR 2.34, 
notice is hereby given that the above-captioned consent agreement 
containing a consent order to cease and desist, having been filed with 
and accepted, subject to final approval, by the Commission, has been 
placed on the public record for a period of 30 days. The following 
Analysis to Aid Public Comment describes the terms of the consent 
agreement and the allegations in the complaint. An electronic copy of 
the full text of the consent agreement package can be obtained at 
https://www.ftc.gov/news-events/commission-actions.
    You can file a comment online or on paper. For the Commission to 
consider your comment, we must receive it on or before September 8, 
2022. Write ``Opendoor Labs Inc.; File No. 192 3191'' on your comment. 
Your comment--including your name and your state--will be placed on the 
public record of this proceeding, including, to the extent practicable, 
on the https://www.regulations.gov website.
    Because of heightened security screening, postal mail addressed to 
the Commission will be subject to delay. We strongly encourage you to 
submit your comments online through the https://www.regulations.gov 
website.
    If you prefer to file your comment on paper, write ``Opendoor Labs 
Inc.; File No. 192 3191'' on your comment and on the envelope, and mail 
your comment to the following address: Federal Trade Commission, Office 
of the Secretary, 600 Pennsylvania Avenue NW, Suite CC-5610 (Annex D), 
Washington, DC 20580.
    Because your comment will be placed on the publicly accessible 
website at https://www.regulations.gov, you are solely responsible for 
making sure your comment does not include any sensitive or confidential 
information. In particular, your comment should not include sensitive 
personal information, such as your or anyone else's Social Security 
number; date of birth; driver's license number or other state 
identification number, or foreign country equivalent; passport number; 
financial account number; or credit or debit card number. You are also 
solely responsible for making sure your comment does not include 
sensitive health information, such as medical records or other 
individually identifiable health information. In addition, your comment 
should not include any ``trade secret or any commercial or financial 
information which . . . is privileged or confidential''--as provided by 
Section 6(f) of the FTC Act, 15 U.S.C. 46(f), and FTC Rule 4.10(a)(2), 
16 CFR 4.10(a)(2)--including competitively sensitive information such 
as costs, sales statistics, inventories, formulas, patterns, devices, 
manufacturing processes, or customer names.
    Comments containing material for which confidential treatment is 
requested must be filed in paper form, must be clearly labeled 
``Confidential,'' and must comply with FTC Rule 4.9(c). In particular, 
the written request for confidential treatment that accompanies the 
comment must include the factual and legal basis for the request and 
must identify the specific portions of the comment to be withheld from 
the public record. See FTC Rule 4.9(c). Your comment will be kept 
confidential only if the General Counsel grants your request in 
accordance with the law and the public interest. Once your comment has 
been posted on the https://www.regulations.gov website--as legally 
required by FTC Rule 4.9(b)--we cannot redact or remove your comment 
from that website, unless you submit a confidentiality request that 
meets the requirements for such treatment under FTC Rule 4.9(c), and 
the General Counsel grants that request.
    Visit the FTC website at https://www.ftc.gov to read this document 
and the news release describing the proposed settlement. The FTC Act 
and other laws the Commission administers permit the collection of 
public comments to consider and use in this proceeding, as appropriate. 
The Commission will consider all timely and responsive public comments 
that it receives on or before September 8, 2022. For information on the 
Commission's privacy policy, including routine uses permitted by the 
Privacy Act, see https://www.ftc.gov/site-information/privacy-policy.

Analysis of Proposed Consent Order To Aid Public Comment

    The Federal Trade Commission (``Commission'') has accepted, subject 
to final approval, an agreement containing a consent order from 
Opendoor Labs Inc. (``Opendoor'' or ``Respondent''). The proposed 
consent order has been placed on the public record for 30 days for 
receipt of comments from interested persons. Comments received during 
this period will become part of the public

[[Page 48481]]

record. After 30 days, the Commission will again review the agreement 
and the comments received and will decide whether it should withdraw 
from the agreement and take appropriate action or make final the 
agreement's proposed order.
    This matter involves Respondent's home-buying service. Respondent 
offers to buy consumers' homes directly as an alternative to listing 
those homes for sale on the market. In advertisements, on its website, 
and in its offers to purchase homes, Respondent has represented that: 
(1) its offers reflect Opendoor's best estimate of the home's market 
value, with no adjustments to that amount; (2) the costs associated 
with a sale to Opendoor are generally lower than costs associated with 
traditional sales; and (3) the vast majority of consumers who sell 
their homes to Opendoor will make substantially more than if they sold 
traditionally.
    The complaint alleges that, in fact, Opendoor reduced its offers 
below what it believed to be the homes' market value, costs associated 
with Opendoor sales were higher than typical costs in a traditional 
sale, and most consumers who sold to Opendoor lost thousands of dollars 
compared to what they would have made in a traditional sale. The 
complaint therefore alleges that Respondent violated Section 5(a) of 
the FTC Act by making false and unsubstantiated claims that consumers 
were likely to realize more money selling their homes to it than they 
would realize in traditional sales, including by misrepresenting that: 
(1) Opendoor's offers reflect its unadjusted assessment of a home's 
market value; (2) Opendoor does not make money from ``buying low and 
selling high''; (3) the costs of repairs it demands a seller make or 
pay for would be likely the same as what they would pay in a 
traditional sale; and (4) consumers would pay less in costs by selling 
to Opendoor than what they would pay in a traditional sale.
    The proposed order contains provisions designed to prevent 
Respondent from engaging in the same or similar acts or practices in 
the future. It applies to the marketing of any ``Real-Estate Service,'' 
defined as ``any product or service designed to assist a consumer in 
selling a home, including Respondent purchasing homes from consumers.'' 
It does not apply to titling services, which are not relevant to the 
allegations in the complaint.
    Part I.A of the order prohibits Respondent from misrepresenting: 
(1) that consumers will receive more money using a Real Estate Service 
than they would using a different good or service; (2) that consumers 
will save money; (3) that consumers will receive a price for their 
homes equivalent to what they would likely receive by listing their 
homes on the market; (4) the amount of repair costs consumers will pay; 
(5) that consumers will save money on repair costs; (6) that any offer 
to purchase a consumer's home is an accurate and unbiased projection of 
that home's market value; and (7) that the person or persons offering 
any good or service do not expect to make money from reselling homes.
    Part I.B prohibits Respondent from making any representation about 
the costs of selling a home traditionally unless the representation is 
non-misleading and Respondent has competent and reliable evidence to 
substantiate that the representation is true. Part I.C prohibits 
Respondent from making any representation about the costs, savings, or 
financial benefit of a Real-Estate Service unless the representation is 
non-misleading and Respondent has competent and reliable evidence to 
substantiate that the representation is true.
    Parts II and III require Respondent to pay to the Commission 
$62,000,000 and describes the procedures and legal rights related to 
that payment. Part IV requires Respondent to provide customer 
information to enable the Commission to administer consumer redress.
    Part V requires Respondent to submit an acknowledgement of receipt 
of the order, and to distribute a copy of the order to: (1) all 
principals, officers, directors, and LLC managers and members; (2) all 
employees having managerial responsibilities for Real Estate Services; 
and (3) any business entity resulting from a change in corporate 
governance. It also requires Respondent to obtain acknowledgements from 
each individual or entity to which a Respondent has delivered a copy of 
the order.
    Part VI requires Respondent to file a compliance report with the 
Commission and to notify the Commission of bankruptcy filings or 
changes in corporate structure that might affect compliance 
obligations. Part VII contains recordkeeping requirements for 
accounting records, personnel records, and advertising and marketing 
materials related to Real-Estate Services, as well as all records 
necessary to demonstrate compliance with the order. Part VIII contains 
other requirements related to the Commission's monitoring of 
Respondent's order compliance. Part IX provides the effective dates of 
the order, including that, with exceptions, the order will terminate in 
20 years.
    The purpose of this analysis is to facilitate public comment on the 
order, and it is not intended to constitute an official interpretation 
of the complaint or order, or to modify the order's terms in any way.

    By direction of the Commission.
Joel Christie,
Assistant Secretary.
[FR Doc. 2022-17077 Filed 8-8-22; 8:45 am]
BILLING CODE 6750-01-P