Court Not Impressed By Airbnb's Argument Against The City Of San Francisco

from the well,-that's-a-problem dept

Earlier this year, we noted that a bunch of cities were looking to make Airbnb liable for residents in those cities using the platform without following certain city rules. As we noted at the time, this seemed to pretty clearly violate Section 230 of the CDA, which says that platforms cannot be liable for the actions of their users. San Francisco went ahead with such a law anyway, even though it tried to rework it at the last minute to deal with Airbnb's points on why it was illegal. The case ended up in court either way -- and unfortunately, the initial ruling has sided with San Francisco over Airbnb.

Now, I know that for a variety of reasons, there are people who just flat out hate Airbnb and think that it's somehow bad or problematic for cities or rental prices or whatever. I don't think the data supports this, but either way, you should be concerned about the results here. This isn't about whether or not Airbnb is "good" or "bad" for cities. It's about a fundamental principle on which the internet operates -- which has allowed the internet to grow and to thrive, and which has protected free speech on the internet, by not making platforms magically liable for what users say or do. But the court here basically doesn't care about all of that.

The judge tries to carefully parse things out to argue that under this law, Airbnb isn't liable for its users' actions, but its own:
As the text and plain meaning of the Ordinance demonstrate, it in no way treats plaintiffs as the publishers or speakers of the rental listings provided by hosts. It does not regulate what can or cannot be said or posted in the listings. It creates no obligation on plaintiffs’ part to monitor, edit, withdraw or block the content supplied by hosts. To the contrary, as San Francisco has emphasized in its briefs and at oral argument, plaintiffs are perfectly free to publish any listing they get from a host and to collect fees for doing so -- whether the unit is lawfully registered or not -- without threat of prosecution or penalty under the Ordinance.... The Ordinance holds plaintiffs liable only for their own conduct, namely for providing, and collecting a fee for, Booking Services in connection with an unregistered unit.
But that misunderstands both the nature of the platform and the nature of Section 230. First of all, the law absolutely creates an obligation on Airbnb to monitor, withdraw or block the content supplied by hosts -- because if they do not, then they will face significant liability. The idea that it's only targeting Airbnb's "conduct" of booking an unregistered unit is simply incorrect. The platform allows anyone to put up any unit. Not Airbnb. Not only does this new regulation falsely attribute to Airbnb the actions of its users, this judge does too. That's a problem.

We've written a lot about Section 230 over the years, and unfortunately in the last few months a bunch of cases have chipped away at these important protections. In each case, the courts seem to think that the situation in front of them is somehow unique and Section 230 shouldn't apply. Considering how important Section 230 has been to the internet as a whole and the protection of free speech, we should be very, very concerned about so many of these cases picking apart the law and adding serious liability. It won't end well. Hopefully Airbnb appeals this... and the 9th Circuit doesn't muck it up.

Filed Under: cda 230, intermediary liability, liability, san francisco, section 230
Companies: airbnb


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  • icon
    Mason Wheeler (profile), 11 Nov 2016 @ 2:17pm

    I'm all for essentially blanket immunity under Section 230 for community content, but AirBNB is something else entirely. It's not just some forum where people can post rental listings, which is what Section 230 was written for because it's the sort of thing that was around when the CDA was written.

    AirBNB is a booking agency. Every rental that takes place, takes place through AirBNB's infrastructure, with AirBNB taking a cut of the deal. To say Section 230 applies here is to create all sorts of perverse incentives, because if you can create a site to help people sell illegal things, get a cut of each sale, and then claim immunity and operate with impunity once people start using it for much more serious crime, what's to stop someone from doing exactly that?

    Sorry, but the only ruling that makes any sense is that AirBNB stops being a simple "content platform" when it becomes a business partner. And I don't see that as "chipping away at Section 230 protections" in the slightest, because it doesn't do anything at all to harm the sites that Section 230 was intended to protect. All it does is properly clarify the boundaries of Section 230 WRT a category of sites that weren't a thing back when the CDA was passed.

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

    • identicon
      YupYup, 11 Nov 2016 @ 2:46pm

      Re:

      Well said

      What's also missing from the conversation is home purchases solely for the intent of stashing wealth. Look to Vancouver B.C. as an example or my neighbor from across the street who does not live in the property yet rents out the rooms.

      My neighbor collects the mail each day, but doesn't enter the home, doesn't sleep in the home. From a government view it appears they live in the home as they collect the mail, but government isn't there to witness they do not stay in the home. This is called tax dodging and AirBnB is the enabler...

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

    • identicon
      Anonymous Coward, 11 Nov 2016 @ 2:59pm

      Re:

      > To say Section 230 applies here is to create all sorts of perverse incentives, because if you can create a site to help people sell illegal things, get a cut of each sale, and then claim immunity and operate with impunity once people start using it for much more serious crime, what's to stop someone from doing exactly that?

      Ask Ross Ulbricht that question.

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

      • identicon
        Anonymous Coward, 11 Nov 2016 @ 5:34pm

        Re: Re:

        That's not fair. There is no question that, unlike Ross Ulbricht and the drug dealers use his website, that either Airbnb or it's users have violated federal laws.

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

    • identicon
      Anonymous Coward, 11 Nov 2016 @ 4:55pm

      Re:

      I see where you're coming from, but how does AirBNB's position in this issue differ from someone selling something illegal on Ebay?

      Now, if San Francisco informed AirBNB that a particular listing was unregistered and AirBNB did nothing, I'd totally agree that they should be liable. However, I don't know if it should be AirBNB's responsibility to verify that every listing complies with every local law.

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

      • icon
        harbingerofdoom (profile), 13 Nov 2016 @ 2:26pm

        Re: Re:

        I think the distinction is what the main focus of airbnb is.

        the state doesnt regulate me selling my guitar. i can use any number of sites that will allow me to list it either free of charge or for a small fee. But they dont focus on selling only guitars so if someone decides to advertise hooker and blow parties on the go, they are protected by section 230.

        airbnb does not have any other function though. since motels and hotels are regulated, and this is the sole purpose of airbnb, it too should fall under the same regulations as motel 6. since i could be advertising a place for rent that included hooker and blow parties- airbnb would have section 230 protections against the hooker and blow party part... but they are still functioning in their one single design of connecting people looking to rent their space with people looking to rent spaces and in that specific function, they would not qualify for 230 protections.


        course thats just my own personal viewpoint and im no laywer.

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

  • icon
    dcarlson (profile), 11 Nov 2016 @ 9:24pm

    Uber has 40k+ drivers in San Francisco, and verifies the validity of each one's driver's license and vehicle registration before they allowed to pick up a passenger. It isn't any more difficult for Airbnb and the other platforms to check whether their listings are properly registered with the city for use as short-term rentals.

    The fact that Airbnb is unwilling to do so is simply a reflection of the fact that 80% of its SF listings are illegal. The units are not primary residences, as the law Airbnb wrote requires, or they belong to tenants who are renting to tourists without the property owners' permission.

    While there are few objections to people renting spare rooms, it's the wholesale conversion of dwelling units to full-time tourist accommodations that's problematic. And it's those units Airbnb clings to so strenuously because they're the most lucrative. Take them away in the major markets and Airbnb's $30 billion valuation evaporates.

    As Judge Donato noted, neither the First Amendment nor the CDA provide a safe harbor for facilitating illegal transactions, which is the foundation of Airbnb's business model. It's ludicrous to argue otherwise.

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

  • identicon
    John Smith, 12 Nov 2016 @ 9:05am

    SF is going about this all wrong. All they need to do is go after airbnb's illegal gains (make them cough up every penny they earned through illegal rental of a place when found) and this problem will solve itself. Doubt Airbnb would enjoy it very much being bombarded with automated fines generated by a script that compares the list of legit rental locations vs their listings.

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

    • icon
      dcarlson (profile), 12 Nov 2016 @ 2:29pm

      Re:

      Until this past June, when the city passed the revised law that Airbnb is now challenging in court, it wasn't illegal for Airbnb to charge booking fees on unregistered rental units. Airbnb's gains were not illegal. Now they are and the company is subject to fines.

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

    • icon
      Mason Wheeler (profile), 14 Nov 2016 @ 8:47am

      Re:

      Yeah, this is a basic idea I've been proposing for a while now:

      The Crime Does Not Pay Act

      Any corporate entity found to be guilty of illegal business practices which brought in revenue shall be fined a minimum of 100% of the revenue received through illegal means.

      Eliminate slap-on-the-wrist fines that can be written off as the cost of doing business, and so many things start to fix themselves.

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

  • identicon
    Anonymous Coward, 13 Nov 2016 @ 4:45pm

    It's pretty simple. Remove "on the internet" from the discussion, and see if the business model would be legal. If it's not, "on the internet" shouldn't suddenly change that.

    AirBnB isn't just a chat board or listing site, it's a business partner, a money handler, and an integral (and unavoidable) part of every transaction. There is no section 230 here.

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

  • identicon
    Anonymous Coward, 14 Nov 2016 @ 2:03pm

    Sorry, Mike, I think you're on the wrong side on this one. Airbnb is far too integrated into the business of its "users" for them to have full Section 230 protections.

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


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