Class Action Suit Claims UDR Violates San Diego Law by Using AI Algorithms to Set Rental Prices

If you rented an apartment in San Diego managed by corporate landlord UDR, Inc., a proposed class action lawsuit alleges that you may have been overcharged due to illegal software that uses nonpublic competitor data to artificially inflate rental rates and limit available housing options.

What Is the UDR Algorithmic Rent Pricing Lawsuit About?

On July 2, 2026, a 22-page proposed class action lawsuit, Keller v. UDR, Inc., was filed in the U.S. District Court for the Southern District of California. The complaint alleges that UDR, Inc., one of the nation’s largest residential property management companies, unlawfully utilizes automated pricing software to determine apartment rent rates and manage unit occupancy across its San Diego properties.

According to court filings, UDR relies on algorithmic software tools provided by data analytics firm RealPage, including its popular YieldStar platform. The lawsuit contends that these automated tools gather private, nonpublic information from competing landlords—such as exact lease transaction terms, effective monthly rates, and unit availability—to generate real-time rental price recommendations.

By substituting traditional market competition with algorithmic coordination, the lawsuit claims that UDR and other large property managers have systematically driven up housing costs for everyday families, making living in San Diego increasingly unaffordable.

San Diego Ordinance Bans Algorithmic Tools Based on Private Competitor Data

The legal foundation of the lawsuit centers on San Diego Municipal Code § 98.1103, a municipal ordinance passed by the San Diego City Council on May 22, 2025, which officially took effect on June 21, 2025.

The ordinance was designed specifically to protect local tenants from technology-fueled price-fixing schemes. Under San Diego law, it is illegal for any residential landlord or property manager to use an algorithmic device to calculate rental prices or occupancy levels when that system relies on nonpublic competitor information, including:

• Actual executed rental rates and recent price changes

• Unannounced unit supply and vacancy levels

• Private lease start dates, end dates, and renewal terms

The lawsuit highlights that UDR has previously admitted in separate litigation in the District of Columbia that it uses RealPage’s YieldStar program as a decision-making tool for pricing multifamily units. By continuing to utilize these algorithms in San Diego after the municipal ban took effect in June 2025, the complaint alleges UDR actively operates in violation of local law.

How Automated Rent-Setting Software Harms San Diego Renters

For generations, apartment landlords set prices based on public market conditions, direct negotiations with prospective tenants, and individual unit vacancy rates. Property management staff often negotiated discounts or reduced lease rates to keep units occupied.

The lawsuit alleges that algorithmic devices like RealPage’s YieldStar upended this model by removing human negotiation from the leasing process. Instead of encouraging competitive pricing to fill empty apartments, the algorithm instructs corporate landlords to hold units off the market or accept higher vacancy rates in order to push overall rent prices upward across an entire geographic region.

The complaint points to research from the Biden Administration’s Council of Economic Advisers, which estimated that algorithmic pricing tools increased average monthly apartment rents in San Diego by approximately $99 per unit in 2023 alone.

Broader Federal and State Legal Action Against Algorithmic Price-Fixing

The class action against UDR builds on a growing national legal movement aimed at stopping corporate landlords from using automated software to coordinate rental housing prices.

In August 2024, the U.S. Department of Justice (DOJ), alongside California Attorney General Rob Bonta and several state attorneys general, filed a landmark federal antitrust lawsuit against RealPage, Inc. Federal prosecutors alleged that sharing competitively sensitive data through AI algorithms constitutes a modern form of illegal price-fixing under federal antitrust statutes. In early 2025, federal regulators expanded the litigation to name major corporate landlords directly as co-defendants.

While federal litigation continues to address national antitrust violations, San Diego enacted Municipal Code § 98.1103 to give local renters immediate, enforceable legal protections within city limits. The current class action suit asserts that UDR must be held accountable under local law for continuing to utilize these prohibited software tools to the detriment of San Diego residents.

Who May Be Eligible to Join the UDR Class Action Lawsuit?

You may be eligible to participate in this legal action if you rented an apartment in San Diego, California, from UDR, Inc. during the relevant statutory period following the enactment of the city’s algorithmic pricing ordinance.

The proposed class seeks to cover:

• San Diego Tenant Class: All individuals who signed a new residential lease or renewed an existing apartment lease for a UDR-managed property in San Diego during the period when UDR utilized algorithmic devices in violation of San Diego Municipal Code § 98.1103.

If certified by the court, the lawsuit seeks financial remedies for affected tenants, including statutory damages, restitution for inflated rent overcharges, and court orders prohibiting UDR from using algorithmic pricing software in San Diego.

What Steps Should You Take If You Rent a UDR Apartment in San Diego?

If you currently rent or previously rented a UDR apartment in San Diego and believe your rent was set using automated pricing software, taking a few organized steps can help document your tenancy and safeguard your legal rights.

Here is what you can do:

1. Locate Your Lease Agreement: Find copies of your lease contracts, renewal notices, and monthly rental statements for your UDR apartment.

2. Document Rent Increases: Keep track of any sudden or steep rent increases required upon lease renewal, as well as any communications regarding non-negotiable pricing.

3. Save Communications: Retain emails, portal messages, or written notes from discussions with leasing agents regarding unit availability or price setting.

4. Monitor Litigation Updates: Follow news surrounding Keller v. UDR, Inc. to stay informed on class certification decisions and potential claim filing procedures.

5. Consult a Legal Professional: Connect with an experienced consumer protection attorney to evaluate your lease history and learn more about your options under San Diego municipal law.