Klobuchar Leads Effort to Ban Algorithmic Price Fixing

WASHINGTON, Feb. 6, 2025 – New Senate antitrust legislation led by Sen. Amy Klobuchar, D-MN., will try to bring a halt to price-setting algorithms that have cost Americans billions of dollars.

The bill would prohibit companies from using algorithmic pricing schemes to coordinate and inflate prices. Klobuchar said in a statement Thursday corporations are using algorithms to collude with each other in order to maintain high market prices and reduce fair competition. Current antitrust law does not cover this type of price fixing because it is happening indirectly through algorithms rather than a formal agreement, Klobuchar said.

The legislation follows a Justice Department lawsuit in January against RealPage, a real estate management software. The lawsuit called out RealPage for using algorithms that “facilitated collusion to increase rents by more than $3 billion in 2023 alone,” Klobuchar said.

Klobuchar was joined by Sens. Ron Wyden, D-OR., Dick Durbin, D-IL., Richard Blumenthal, D-CT., Mazie Hirono, D-HI., Ben Ray Luján, D-N.M., Chris Murphy, D-CT., Jeanne Shaheen, D-N.H., and Peter Welch, D-VT., introduced the Preventing Algorithmic Collusion Act Thursday. 

Klobuchar hopes to put an end to RealPage and other corporations’ illegal management practices. “Price fixing is illegal under our antitrust laws, but the development of price-setting algorithms can exploit loopholes that could be used to unfairly raise prices on everything from rent to rideshares,” Klobuchar said. 

The bill hopes to close the loopholes empowering algorithmic price-fixing and allow for the auditing of company’s price algorithms.

“My bill would strengthen antitrust law and guarantee needed transparency to prevent companies from using algorithms to fix prices to ensure consumers are able to get the full benefits of competition,” Klobuchar said.