Airbnb Goes To Court To Stop San Francisco's New Anti-Airbnb Law

from the section-230 dept

Back in May, we noted that large cities around the country were rushing to put in place anti-Airbnb laws designed to protect large hotel companies. In that post, we noted that many of the bills almost certainly violated Section 230 of the CDA by making the platform provider, Airbnb, liable for users failing to "register" with the city. Section 230, again, says that a platform cannot be held liable for the actions (or inactions) of its users. San Francisco was the first city to get this kind of legislation pushed through. And while the city's legislators insisted that Section 230 didn't apply, they're now going to have to test that theory in court. Airbnb has asked a court for a preliminary injunction blocking the law, based mainly on Section 230, but also mentioning the Stored Communications Act and tossing in a First Amendment argument just in case.
As designed and drafted by the Board of Supervisors, the Ordinance directly conflicts with, and is preempted by, Section 230 of the Communications Decency Act, 47 U.S.C. § 230 (the “CDA”). According to its own sponsors, the law holds “hosting platforms accountable for the hundreds of units (rented by) unscrupulous individuals” posting listings on their websites, and holds “Airbnb Accountable for Listing Illegal Short Term Rentals.” Declaration of Jonathan H. Blavin (“Blavin Decl.”)... As such, the Ordinance unquestionably treats online platforms like Airbnb as the publisher or speaker of third-party content and is completely preempted by the CDA. In addition, the law violates the Stored Communications Act, 18 U.S.C. §§ 2701 et seq. (the “SCA”), by requiring disclosure to the City of customer information without any legal process, and the First Amendment as an impermissible content-based regulation.
As Airbnb points out, the city even recognized that the bill probably runs afoul of Section 230, but signed it into law anyway:
The City was not blind to the fact that the Ordinance might run afoul of the CDA and other laws. Following its passage, the Mayor’s office said that the “mayor remains concerned that this law will not withstand a near-certain legal challenge and will in practice do nothing to aid the city’s registration and enforcement of our short-term rental laws.” ... The City Attorney’s Office acknowledged that the Ordinance could raise “issues under the Communications Decency Act” but claimed that it had been drafted “in a way that minimizes” those issues by regulating “business activities” instead of “content.” ... Despite the City’s best efforts to tiptoe around the CDA through such semantic devices, the problem for the City is that the substance of what the Ordinance seeks to do violates the CDA. No amount of creative drafting can change that reality.
The Stored Communications Act argument involves the requirements of Airbnb to turn over information on its users. The SCA is a part of ECPA, the Electronic Communications Privacy Act, that is supposed to protect the privacy of electronic communications (though, it's in deep need of an update). Here, Airbnb points out that the city ordering it to release customer information almost certainly violates the SCA.
The verification provisions of the Ordinance separately are barred by the SCA. In a futile effort to sidestep the CDA, the Ordinance requires Hosting Platforms to verify listings by disclosing to the City host names and addresses “prior to posting” a listing—and without a subpoena.... But in this failed endeavor to avoid Section 230, the Ordinance runs smack into the SCA, which bars state laws that compel online services like Airbnb to release customer information to governmental entities without legal process.
The First Amendment argument is basically a backstop in case the CDA and SCA arguments fail, and then there's a Constitutional argument to appeal. If the court deals with the case on CDA and SCA grounds, it probably will avoid the First Amendment question altogether. But, the basis is that regulating types of advertisements on Airbnb's platform is a form of a content-based restriction on speech. And there is a strong argument that in restricting the content on the platform, rather than merely punishing the people who post their content to Airbnb, that the law violates the First Amendment. There are exceptions but, generally speaking, the First Amendment doesn't like any law that blocks out speech entirely, even if it's commercial speech.
The Ordinance also violates Hosting Platforms’ First Amendment rights. The prohibition on the publication of certain rental advertisements—i.e., those listings without verified registration numbers—is a content-based speech restriction subject to “heightened judicial scrutiny” under the First Amendment.... The City cannot meet its burden of demonstrating that this speech restriction directly advances a substantial state interest and does so in a narrowly tailored way. Even assuming the Ordinance actually advances a substantial state interest (which is questionable), it places a far greater burden on speech than is necessary to achieve that end. The “normal method of deterring unlawful conduct” is to punish the conduct, rather than prohibit speech or advertising regarding it.... The City cannot show that the obvious alternative of enforcing its existing laws against third-party residents who rent properties in violation of the law, rather than against Hosting Platforms, would be ineffective or inadequate. Just the opposite: it is clear the City could enforce its laws directly against hosts who violate them—as it already has begun to do with increasing effectiveness and success—rather than indirectly against Hosting Platforms that publish listings. Further, the law is unconstitutionally overbroad as it punishes platforms for publishing any listing without complying with its “verification” procedures—including those listings that may be lawful.
Whatever you think of Airbnb (and people seem to get more emotional about it than seems reasonable...), this lawsuit could become quite important in making sure that Section 230 remains strong in protecting internet services providing useful services to individuals. In the past month or so, we've seen a number of questionable Section 230 rulings (especially in California) that have started to chip away at this law. However, I don't see how any of those rulings directly apply to this case. The most direct comparison is probably the Model Mayhem case but, in that case, the court was clear that it allowed the California law requiring the platform to "warn" users to stand in part because it did not require the platform "to remove any user content or otherwise affect how it publishes or monitors such content." That's clearly not the case with this Airbnb law.

Either way, this is a case worth following, and hopefully one where the courts don't lop off another chunk of Section 230's protections (or, for that matter, the SCA's privacy protections).

Separately, there's a very, very bizarre NY Times article about this, falsely claiming that Airbnb is suing over a law it helped pass. That's just wrong. It's really bad reporting. Airbnb is clearly suing over the new language voted in by the SF Board of Supervisors earlier this month, and not the broader law that passed a few years ago.

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  • icon
    Mason Wheeler (profile), 28 Jun 2016 @ 11:20am

    The First Amendment argument is basically a backstop in case the CDA and SCA arguments fail, and then there's a Constitutional argument to appeal. ... There are exceptions, but generally speaking, the First Amendment doesn't like any law that blocks out speech entirely, even if it's commercial speech.

    I honestly don't see how the First Amendment applies here. The problem isn't the speech (posts on a website) but rather the illegal commercial action (offering short-term rentals in violation of the law). Let people post whatever they want on a website, but if they act on it, they're breaking the law and the First Amendment has no grounds to protect them.

    reply to this | link to this | view in chronology ]

    • This comment has been flagged by the community. Click here to show it
      icon
      vancedecker (profile), 28 Jun 2016 @ 11:35am

      Re:

      It's a Mike Masnic article, you have to expect the usual Anarcho-Libertarian Gobbledygook of legalistic mumbo junmbo

      reply to this | link to this | view in chronology ]

    • icon
      Mike Masnick (profile), 28 Jun 2016 @ 1:41pm

      Re:

      The problem isn't the speech (posts on a website) but rather the illegal commercial action (offering short-term rentals in violation of the law)

      In which case the gov't is okay with going after the people doing that action -- the individuals making those transactions. But that should not apply to the platform that is posting their ads.

      reply to this | link to this | view in chronology ]

  • icon
    vancedecker (profile), 28 Jun 2016 @ 11:33am

    As usual, another Mike Masnic article, is complete BS

    Limiting AirBNB is not like regulations limiting Uber or Lyft. In that case corrupt entrenched Taxi companies need to be shoved out of cities across the country.


    However, in the case of AirBNB, the effect is that Apartment rents are skyrocketing in places like Los Angeles and San Francisco, because assholes are buying apartments and condos and then renting them out on AirBNB.

    I 100% support efforts to make AirBNB completely illegal.

    reply to this | link to this | view in chronology ]

    • identicon
      michael, 28 Jun 2016 @ 12:53pm

      Re: As usual, another Mike Masnic article, is complete BS

      "I 100% support efforts to make AirBNB completely illegal."

      Agreed. I'm sure it works out great if you live in Mayberry or a slum, but here in Las Vegas it's been a nightmare.

      My quiet, historic neighborhood of mostly retirees had an Airbnb party house that led to large-scale vandalism throughout the neighborhood. Fortunately, the City Council shut it down.

      If Mike considers our reaction to repeated, expensive property damage "people getting more emotional about it than seems reasonable," then I invite him to sleep next door to an Airbnb house for a few months.

      reply to this | link to this | view in chronology ]

      • icon
        Mike Masnick (profile), 28 Jun 2016 @ 1:43pm

        Re: Re: As usual, another Mike Masnic article, is complete BS

        If Mike considers our reaction to repeated, expensive property damage

        If that's your complaint, that's fine, then deal with THAT issue, rather than twisting laws to attack platform providers. There are laws in place to deal with the issue that you're discussing, but the wider impact is on lots of people who DON'T have that issue you're facing. Lots of people have found Airbnb to be a really useful way to generate extra income and for travelers it's been a godsend.

        reply to this | link to this | view in chronology ]

        • icon
          vancedecker (profile), 28 Jun 2016 @ 4:21pm

          Re: Re: Re: As usual, another Mike Masnic article, is complete BS

          BS MIKE! AIRBNB can easily limit accounts and watch for people trying to rent out multiple properties.

          It was meant for ONE person renting out THEIR apartment or home. In Los Angeles, every local asshole with mommy and daddy's money have bought up any and all new apartments around Hollywood and now rents them out on AIRBNB.

          reply to this | link to this | view in chronology ]

          • icon
            nasch (profile), 28 Jun 2016 @ 4:42pm

            Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

            AIRBNB can easily limit accounts and watch for people trying to rent out multiple properties.

            That doesn't mean section 230 doesn't apply.

            It was meant for ONE person renting out THEIR apartment or home. In Los Angeles, every local asshole with mommy and daddy's money have bought up any and all new apartments around Hollywood and now rents them out on AIRBNB.

            That also has no bearing on whether this regulation complies with federal law, which is what's in question here.

            reply to this | link to this | view in chronology ]

            • icon
              vancedecker (profile), 28 Jun 2016 @ 6:37pm

              Re: Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

              Good for them. They are using whatever tools they have to get rid of a pest.

              reply to this | link to this | view in chronology ]

              • icon
                nasch (profile), 28 Jun 2016 @ 8:22pm

                Re: Re: Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

                They are using whatever tools they have to get rid of a pest.

                So it's OK for the government to break the law as long as you agree with the goal?

                reply to this | link to this | view in chronology ]

                • icon
                  vancedecker (profile), 28 Jun 2016 @ 9:24pm

                  Re: Re: Re: Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

                  They aren't breaking the law, they are using some obscure legal premise to fight a pest.

                  The path of least resistance.

                  Just like in order to get rid of the mob, the government used the tax code, because it was too difficult to use the criminal code, with people being the idiots that they were the mafia was able to easily maneuver themselves around it.

                  reply to this | link to this | view in chronology ]

                  • icon
                    Mike Masnick (profile), 29 Jun 2016 @ 6:57am

                    Re: Re: Re: Re: Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

                    They aren't breaking the law, they are using some obscure legal premise to fight a pest.


                    An obscure legal premise that helped make the internet what it was. An obscure legal premise that, if changed, would mean that I would almost certainly shut down Techdirt?

                    You have no clue what you're talking about.

                    The path of least resistance.


                    The ends justify the means? No. That's not how due process works.

                    Just like in order to get rid of the mob, the government used the tax code, because it was too difficult to use the criminal code, with people being the idiots that they were the mafia was able to easily maneuver themselves around it.

                    That you think this is okay is scary.

                    reply to this | link to this | view in chronology ]

                  • icon
                    nasch (profile), 29 Jun 2016 @ 7:06am

                    Re: Re: Re: Re: Re: Re: Re: Re: As usual, another Mike Masnic article, is complete BS

                    They aren't breaking the law

                    That's what this lawsuit is about, isn't it? Even the people who passed the law knew it was borderline. It sounds to me like it's going to be struck down, and then they'll have to find a more legitimate means to deal with the problems AirBnB users are causing. Which is what they should have done to begin with.

                    reply to this | link to this | view in chronology ]

        • identicon
          Dianna, 4 Sep 2016 @ 3:03pm

          Re: Re: Re: As usual, another Mike Masnic article, is complete BS

          If people need extra money, why don't they get a second job or quit spending so much money on all the bullshit known as consumerism.

          As far as travelers go, they should stop being so damn cheap and realize that when they get home they may have to deal with an "Airbnb / Commercial hotel" as their neighbor.

          This is exactly what is wrong with society today, it is the "ME" generation. People do not care about family or their neighbors. With that said it will continue to cause problems.

          Airbnb is killing the sense of community in New Orleans, these so called "travelers" that refer to themselves as "living like a local" are nothing but cheap, useless, annoying tourist. They are the 10% tippers of the world always looking for a Groupon deal.

          reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 29 Jun 2016 @ 8:15am

      Re: As usual, another Mike Masnic article, is complete BS

      "However, in the case of AirBNB, the effect is that Apartment rents are skyrocketing in places like Los Angeles and San Francisco, because assholes are buying apartments and condos and then renting them out on AirBNB. "

      Ahh, so you did see the relevance of my post to Airbnb when you read it. You just pretended not to. IOW, you were just trolling and you essentially made me waste my time spelling it out to you for no reason at all.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 28 Jun 2016 @ 12:36pm

    One of the issues is that cities are so concerned with anything that may 'reduce property values' that they prevent the building of apartment buildings (& their accompanying parking structures), especially high rise apartment complexes and condominiums.

    Some may consider this good because they argue that too many apartment complexes and condominiums leads to a lot of congestion. This is something landowners/landlords, especially those that rent out their property to others, would lobby for because the less competition you have the more you can charge in rent. and people with money have political influence in many cities and cities hate to have an excuse to reduce property values.

    Others would argue that this is bad. The negative side is that landowners can charge more for rent and it's harder for you to own your own home or condominium unit because there is less competition and so prices are higher. This also often leads to a much larger homeless population since there is less housing or more people have to share houses (often under the government's radar) to compensate.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 28 Jun 2016 @ 12:47pm

      Re:

      (prevent/limit)

      reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 28 Jun 2016 @ 12:55pm

      Re:

      and one question to ask is to what extent do apartment complexes and high rise living accommodations reduce actual value because they create less desirable living conditions and to what extent do they simply reduce price because they create more competition.

      The former may be a reason for cities to limit them. The latter is a poor reason to limit them.

      Also to consider is to what extent may these living accommodations improve living and city conditions by either reducing the homeless population or by reducing the extent that people have to share homes/subrent.

      reply to this | link to this | view in chronology ]

    • icon
      nasch (profile), 28 Jun 2016 @ 1:51pm

      Re:

      I don't think "increasing property values" is a goal that government should have. Lower property values allow more people to own property. Why should government try to further enrich those who already own property?

      reply to this | link to this | view in chronology ]

      • icon
        Aaron Walkhouse (profile), 28 Jun 2016 @ 8:33pm

        Don't forget the property taxes.

        By raising valuations and then assessing the higher values
        they get more tax money without hiking tax [u]rates[/u].

        reply to this | link to this | view in chronology ]

      • icon
        Omnitech (profile), 30 Jun 2016 @ 10:07pm

        Re: Re: "increasing property values"

        I suppose you've never witnessed a place which has gone from a decent place to live to a dangerous, crime-ridden slum, eh?

        "Increasing property values" is often just a codeword for "making our communities more pleasant and desirable". Nothing wrong with that. You can't increase the general appeal of anything in this world without increasing its perceived value.

        That said, the property values in SF are ridiculous. But that's mostly down to poor urban planning and an addiction to property tax inflation.

        San Francisco could stop real-estate speculation dead in its tracks by simply imposing a substantial transfer fee on real-estate properties, particularly for short-term ownership. But they are too addicted to the property tax inflation.

        So now we have a city where workers increasingly can't afford to live, which in the long run will undermine diversity (it already has) and, despite what the wealthy think, undermine the quality of the city as a whole.

        reply to this | link to this | view in chronology ]

        • icon
          nasch (profile), 1 Jul 2016 @ 7:27am

          Re: Re: Re: "increasing property values"

          "Increasing property values" is often just a codeword for "making our communities more pleasant and desirable".

          If the goal is making communities better and that has the side effect of making properties more valuable, that's fine. I just don't see why the government should have rising property value as a goal unto itself (rather than a proxy for a harder to measure attribute).


          San Francisco could stop real-estate speculation dead in its tracks by simply imposing a substantial transfer fee on real-estate properties


          Probably, but that would probably also have less desirable side effects. I really don't think there's going to be a simple solution to such a complex problem. Or rather, if they were to focus on just one aspect of the problem - such as real estate speculation - the solution could be ineffective, or make other aspects worse.

          So now we have a city where workers increasingly can't afford to live, which in the long run will undermine diversity (it already has) and, despite what the wealthy think, undermine the quality of the city as a whole

          It does sound like a big issue from what I've heard, and sounds like NYC has some of that as well - only the wealthy can afford to live in Manhattan.

          reply to this | link to this | view in chronology ]

    • icon
      vancedecker (profile), 28 Jun 2016 @ 10:43pm

      Re:

      This comment literally has nothing to do with anything.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 29 Jun 2016 @ 7:32am

        Re: Re:

        Well one of the claimed reasons that cities are proposing anti-Airbnb laws is because it supposedly encourages houses, apartments, and condominiums to be converted over to hotels and motels creating housing shortages. I'm just pointing out that perhaps part of what causes housing shortage isn't necessarily Airbnb but politicians themselves. If politicians are so concerned about housing shortages instead of just going after Airbnb they could explore the option of allowing more housing facilities to be built.

        A quick google search

        "Specifically, housing shortages in many cities, including San Francisco and Los Angeles, were caused and perpetuated by city governments’ unwillingness to increase their housing supply.

        ...
        The least affordable housing markets are those where new housing permits have not kept up with population growth."

        http://www.forbes.com/sites/jaredmeyer/2015/11/02/airbnb-california-proposition-f-housing-sh ortage/#86abde728d0c

        But you can also make a counter argument that allowing more houses and hotels to be built may be an inconvenience to the residence that do live in an area as they must now deal with the congestion, noise, traffic, and whatever other inconveniences that are associated with too many tourists always visiting when all they wanted was some peace and quiet. So it should really be left up to the residence of an area to decide how they want their city managed, if they want all these hotels and if they want their neighborhood to be a tourist attraction or not. I'm just pointing these things out to bring a broader perspective to consider.

        reply to this | link to this | view in chronology ]

        • identicon
          Anonymous Coward, 29 Jun 2016 @ 11:01pm

          Re: Re: Re:

          residences *

          reply to this | link to this | view in chronology ]

        • icon
          Omnitech (profile), 30 Jun 2016 @ 10:13pm

          Re: Re: Re:

          Have you ever been in San Francisco? It's one of the most densely-populated cities in the US. There's just not any free space here to build new housing, for the most part. Almost anything you build will require tearing something else down.

          But I do agree in part - the government could have been more aggressive about building residential housing. Even now after anyone with two brain cells to rub together can figure out we have a housing shortage, they keep approving these large projects where they only require something trivial like 10% of the total to be affordable or "market rate" units. (Which in SF means "exorbitant".)

          reply to this | link to this | view in chronology ]

          • icon
            nasch (profile), 1 Jul 2016 @ 7:28am

            Re: Re: Re: Re:

            There's just not any free space here to build new housing, for the most part.

            They can always build up, but the people there are apparently dead set against that.

            reply to this | link to this | view in chronology ]

            • icon
              Omnitech (profile), 1 Jul 2016 @ 3:55pm

              Re: Re: Re: Re: Re:

              They can always build up, but the people there are apparently dead set against that.

              Plenty of that has happened too, it's just a much bigger deal to do that here than it is in some sprawling suburb where they can just raze a field or a parking lot and start building.

              And San Francisco has a deserved reputation from an aesthetic POV (which is also critical for the tourism business here), they don't approve any old junk building. We also have high standards in areas like seismic measures, since we'd rather not have half the city burn to the ground in the next 1906-scale earthquake. ;)

              reply to this | link to this | view in chronology ]

              • icon
                nasch (profile), 1 Jul 2016 @ 4:10pm

                Re: Re: Re: Re: Re: Re:

                We also have high standards in areas like seismic measures, since we'd rather not have half the city burn to the ground in the next 1906-scale earthquake.

                Typical liberal nanny-state city with "building standards" because they're afraid of the city "burning to the ground" like "it did last time". Bah!

                reply to this | link to this | view in chronology ]

  • icon
    DB (profile), 28 Jun 2016 @ 8:26pm

    The issue is that San Francisco would burn down the world (destroy the protection that section 230, and the first amendment, provide) to accomplish their narrow goal.

    It doesn't matter if you agree with the new business that AirBnB enables, you should see how dangerous this approach is.

    reply to this | link to this | view in chronology ]

  • icon
    Omnitech (profile), 30 Jun 2016 @ 9:55pm

    Carpetbaggers

    AirBnB, like the majority of the trendy and ironically-named "sharing economy" companies, is just another opportunist carpetbagger looking for regulatory loopholes they can exploit to make boatloads of money.

    The PROBLEM in San Francisco - where I happen to have lived for many decades - is that real estate and rental prices are ridiculous - the highest in the USA. We have a huge shortage of rental property here, and AirBnB greatly exacerbates the problem by allowing people to essentially act like hoteliers without any of the traditional legal obligations that innkeepers and hoteliers have had to comply with, yanno, for dumb reasons like protecting the health and welfare of their boarders and the community around them. (Just like the rest of the "sharing economy" companies have turned their workers into powerless serfs while destroying the business of companies that actually pay their workers a living wage)

    AirBnB also didn't like it very much when a study was released recently that demonstrated what many of us had been saying all along: the majority of AirBnB properties in SF had essentially become nearly full-time businesses rather than poor little Joe Sixpack trying to earn an occasional extra dollar to help pay for his kid's Pampers. In short, it's just another way to make an end-run around ordinances designed to protect the public, in order to make a quick buck. (And in the process - in this city - keeping even more residents from being able to find affordable housing)

    SF had been giving AirBnB a pass for too long, this was the FIRST time a rule had been voted-in to put them on a tighter noose.

    These companies could just accept reality and stop thinking that they are an endless money-printing machine and accept that their business will have a limited scale in order to not create economic and social chaos. But they are too self-righteous and drunk with eager VC money to get a grip on that reality.

    Screw them.

    reply to this | link to this | view in chronology ]


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