Lawsuit accuses Zillow and Microsoft of wiretapping

Two visitors to Zillow's website have filed a class action lawsuit alleging the Seattle-based company illegally, and without their consent, wiretapped them online.

Why it matters: The claim is among a handful of recent lawsuits alleging that companies are violating people's privacy rights as they record customer interactions on their websites.

• How the cases are resolved could have big implications for how companies track people's web activity — and the steps they must take to obtain a person's consent before doing so.

Driving the news: The class action suit, filed Monday in the U.S. District Court for Western Washington, alleges that Zillow tracks users' web activity in a way that amounts to illegal wiretapping.

• The claim alleges Zillow, the online real estate marketplace, uses a third-party tool from Microsoft to track visitors' mouse movements, keystrokes and other actions on Zillow's website.
• Microsoft — which is also named as a defendant in the lawsuit — then creates a video replay of the visitor's entire website session, which is provided to Zillow for analysis, the lawsuit says.
• The result is "the electronic equivalent of 'looking over the shoulder' of each visitor to the Zillow website," according to the complaint.
• Such "conduct is highly offensive and objectionable to a reasonable person and constitutes an egregious breach of the social norms underlying the right to privacy," the claim says.

The other side: A spokesperson for Zillow said the company is reviewing the lawsuit and "takes the privacy and security of users' information very seriously."

• "We are transparent with our users through our privacy policy, which explains to users the types of information we collect as they use our apps and websites," the spokesperson wrote in an email to Axios.

What to watch: A Microsoft spokesperson said the company was "looking into this closely," but did not offer further comment.

Of note: In Pennsylvania, three similar lawsuits were recently filed against Zillow, Lowe's and Expedia.