Airbnb Is Suing San Francisco to Block Rental Rules

http://www.bloomberg.com/news/articles/2016-06-27/airbnb-is-suing-hometeown-san-francisco-to-block-rental-rules

by tomsaffell • 10 years ago

113 161 10 years ago

mikeryan2• 10 years ago

Would love to hear an opinion on this one from a legal mind, the case does not seem strong for Airbnb from my laymen's couch.

twinkletwinkle• 10 years ago

No legal expertise, but the thing that struck me is Campos' extremely flawed analogy. If we want to make comparisons to rental cars, the hosts are the rental companies. There is no third party platform to compare to AirBnB.

frank_jaeger• 10 years ago

Not currently no. In an unrelated note, I have an idea that just might disrupt the automotive rental industry...

gorkemyurt• 10 years ago

how about something like Getaround? https://www.getaround.com

kelnos2• 10 years ago

I was thinking the same thing -- this law is more like a hypothetical law requiring people who rent out their cars (not the renters themselves) to register with the city, and requiring Getaround to police that registration.

swehner2• 10 years ago

First amendment, for sure.

I'm guessing this is about this, "The new law would require Airbnb and other short-term rental websites to post registration numbers on listings or email the number and name of the host to the Office of Short-Term Rentals, The City’s agency tasked with enforcing the regulations." (From http://www.sfexaminer.com/sf-poised-require-airbnb-list-regi...)

So "their" "free speech rights" are "violated" because they have to post registration numbers.

bunderbunder2• 10 years ago

If they win this case, I'm starting a betting pool on how long it is until some corporation claims that reporting employee income to the IRS violates free speech.

ggreer• 10 years ago

It's nothing so silly. As a counterpoint to the Examiner's piece, please read Airbnb's post about the proposed law: https://www.airbnbaction.com/an-update-for-our-community-in-...

Basically, the city wants to hold Airbnb responsible for user-generated content. The city also wants Airbnb to hand over users' personal information. Both the EFF and the Center for Democracy & Technology think that these requirements violate federal law. (Though EPIC thinks otherwise.)

ot2• 10 years ago

Basically, the city wants to hold Airbnb responsible for user-generated content.

Airbnb gets paid for the rentals, not for the listings. Also, they actively control the content (try putting an URL in the listing). Mistaking Airbnb for a publishing medium for user-generated content seems disingenuous at best.

CodeWriter232• 10 years ago

That's a specious argument and AirBNB is gonna get spanked hard on that one. Also, the CDA Safe Harbor never intended to shield service providers that receive direct monetary benefit from user content itself.

swehner2• 10 years ago

I read it. Quite wordy. Not much difference. To call ads "user-generated content" is a bit of a stretch, no? After all, "AirBNB" is much a party to the transaction.

argonaut• 10 years ago

Read the article more carefully. Airbnb's first amendment argument is not related to having to send info to regulators, it's related to something else entirely.

ben_jones• 10 years ago

Regardless of how strong Airbnb's legal standing is or isn't, they are the definition of a company who believes it better to ask forgiveness then permission. I believe that maxim is all fine and good when you're a person who cares about the well being of others, but when it's a corporation whose only goal is profit or growth it has the potential to be extremely detrimental to society.

JoshTriplett• 10 years ago

Depends on your point of view. It's also detrimental to society if every new idea has to prove its viability while following the rules written for (and often purchased by) the previous generation of technology. It'd be a lot easier to get stuck in local maxima that way. Some ideas would never get traction, because getting the rules changed requires power and traction in the first place.

aaroninsf• 10 years ago

I would submit that this maxim does not well apply to the business model of AirBnB, Lyft, Uber, and the like.

They do not IMO represent an interesting application of technology. Just the profits of exploiting lag time between what is possible, and what is 'burdened' by consumer and labor protections.

I.e.: the industries they have moved into are highly regulated for pretty transparent reasons. Their MO works well until the regulators catch up.

snappy1732• 10 years ago

Regardless of how strong Airbnb's legal standing is or isn't, they are the definition of a company who believes it better to ask forgiveness then permission.

not really. they were caught, and their response is f* you, rather than to ask forgiveness. whether or not you agree with their behavior, they are very much NOT asking for forgiveness.

randycupertino2• 10 years ago

Don't forget the butthurt ads they plastered the city with once they were finally made to pay their taxes. "Dear SF, Hope you are putting our tax $$ to good use! Love Airbnb!"

bpodgursky3• 10 years ago

Free speech rights are a stretch here. I wonder if you could make a viable case for the 3rd amendment though (to my knowledge it has never been done).

Strictly interpreted, the 3rd amendment prevents the government from being able to force homeowners to quarter soldiers. If you think about the real intent of the bill though, it's obvious that the mindset is "you are free to use your own house without government interference."

Realize that at the time, HUGE numbers of homeowners informally had a room or two for boarders to supplement their income. It would have been considered ridiculous at the time for the government to say you couldn't lend a room out for money, which is probably why this interpretation was not formally codified.

It's a stretch, but amendments have been interpreted in more creative ways to accomplish personal-freedom goals (think, right to privacy -- interpreted as an implied constitutional right, but not mentioned anywhere).

snappy1732• 10 years ago

Strictly interpreted, the 3rd amendment prevents the government from being able to force homeowners to quarter soldiers. If you think about the real intent of the bill though, it's obvious that the mindset is "you are free to use your own house without government interference."

that's a real stretch. that would nullify all zoning ...

bpodgursky3• 10 years ago

Maybe? But then again, the 2nd amendment doesn't allow nuclear weapons, as interpreted by the Supreme Court.

Would be easy to interpret it as, the right to use residential properties for lodging purposes (hotel, apartments, B&Bs) cannot be violated, without letting you set up industrial operations.

HarryHirsch• 10 years ago

It is a stretch. If the Founding Fathers had meant to say you are free to use your property without government interference they would have done that.

They had tanneries then, and there is more than a gradual difference between operating a tannery and quartering a bunch of soldiers in someone's house. One interferes with the life of the householder. The other interferes mostly with the life of the neighbours.

Spooky232• 10 years ago

I think the 3rd amendment is about as clear as it gets. Unlikely.

bunderbunder2• 10 years ago

"No Soldier shall, in time of peace be quartered in any house, without the consent of the Owner, nor in time of war, but in a manner to be prescribed by law."

I think it'd be safe to say that Airbnb would have a tough row to hoe trying to base their case on the Third Amendment.

Spooky232• 10 years ago

Airbnb is an unlimited well of bad PR. They need to start whacking people with a clue-stick.

randycupertino2• 10 years ago

They'd probably do well to just fire their PR person. This is one of the most unprofessional responses I've ever heard from a company to a reporter:

We emailed Airbnb spokesman Christopher Nulty to ask whether the library ad was "real." He responded by email, "as opposed to a fake one :)"

A follow up email, explaining that we were in fact seeking confirmation as to whether the ads are actually from Airbnb received the following response: "Are you seriously writing on this?"

Nulty did not respond to another follow up email.

http://www.sfweekly.com/thesnitch/2015/10/21/passive-aggress...

kafkaesq2• 10 years ago

They'd probably do well to just fire their PR person.

No, it's not "the PR person" who's at fault.

One way or another, these decisions (and the mentality and ethos that drive them) always trickle down from the top.

kelnos2• 10 years ago

So basically SF wants companies like Airbnb to do their police/enforcement work for them. The city should be going after the unregistered renters themselves. Sure, that's potentially harder, but I can see that it'd be a burden to order a company to do it for them.

reza_n• 10 years ago

Who would pay for all this extra enforcement? My guess is that a large portion of this short term rental income is untaxed. Can't have both sides, no regulation and no tax. I pay my share when I rent a hotel. (Apologies if airbnb renters are paying the appropriate city, state, and federal taxes).

mrgordon• 10 years ago

Airbnb takes the appropriate local taxes automatically as part of the booking

areyousure2• 10 years ago

San Francisco collects no shortage of taxes.

kafkaesq2• 10 years ago

So basically SF wants companies like Airbnb to do their police/enforcement work for them.

Because it's the most cost-effective way of doing things, and -- in this ethically-challeneged startup culture of ours -- it gets the message across.

It's also no different from how regulations are applied to most all other industries in that regard. Liquor stores are required to card anyone who looks like they might possibly be under 21 (and are fined for not doing so). You can argue that the city "should be going after the underage drinkers themselves" -- but decades of empirical evidence suggest this would lead to the laws being widely unenforced.

mc329• 10 years ago

When does Campoes term out anyway?

There certainly is a struggle between ownership rights and the right of cities to regulate business within their jurisdiction.

As a renter, I can sympathize with wanting to avail more rental properties to renters, but I am also very uneasy with politicians dictating what you can and cannot do with your property when that act in and of itself is not otherwise illegal. It's not confiscation, but it also kerbs your ability let your property as you wish --and I say this as a renter who arguably would benefit from this politician's policies.

PS move HQ to Brisbane and take the corp taxes with you.

sjwright• 10 years ago

Speaking entirely out of ignorance, how might these policies benefit someone like yourself?

jedberg2• 10 years ago

People who buy housing just to rent out on AirBnB would find it more economical to rent out to a long term renter (because the licensing is actually less onerous), thereby increasing the rental supply and lowering rents.

mc329• 10 years ago

By disallowing properties which would otherwise be put on the rental market strictly on ab&b thus arguably subtracting this unit out from the rental market.

sp3323• 10 years ago

But your neighbors might not want you to let out your place to an endless parade of strangers. This is a case where the government needs to listen to the people, and determine if the majority want more freedom or a nicer neighborhood.

mc329• 10 years ago

True enough. They might also only want single family homes to be owner or family occupied only. I think there can be compromises people come to.

cstejerean• 10 years ago

Then your neighbors should put that in their HOA rules. The city is getting involved to protect hotels not "neighbors".

gshulegaard4• 10 years ago

Who cares what your neighbors want? Seriously.

In the Seventeenth Century many American colonists were fleeing England due to religious persecution because their religion didn't happen to be the the dominant/majority held belief [1].

The idea that government should govern based on what the majority want is a fallacy. The specific topic of tyranny of the majority and ways to combat it were discussed in the Federalist papers and, in my belief, is ultimately the reason the Founding Fathers structured American government the way it did (federation, checks and balances, republic, etc.).

I am not trying to argue that AirBnB is good, but it's not bad because your neighbors don't like it.

[1] https://www.loc.gov/exhibits/religion/rel01.html

[2] https://en.wikipedia.org/wiki/The_Federalist_Papers

nostromo• 10 years ago

But your neighbors might not want you to let out your place to an endless parade of strangers.

This is the argument NIMBYs have been using against regular old renters since the beginning of time.

ap36• 10 years ago

Do my neighbors own my place, pay my mortgage or my bills?

ProAm2• 10 years ago

but I am also very uneasy with politicians dictating what you can and cannot do with your property when that act in and of itself is not otherwise illegal

The list of things you cannot do is already extremely lengthy and much to the chagrin of homeowners. I assume you've only rented and never owned, but wait until you see what your property taxes go to, what you are allowed to build, not build, must maintain, must pay for on behalf of citizens that do not own (Denver is currently trying to raise property taxes to subsidize builders and ease purchase pain of new homeowners who currently cannot afford to buy for example). I think people are up in arms over this because Airbnb is a large player in the startup community, but the uproar of politicians creating policy for it's citizens is not absurd.

mc329• 10 years ago

Yes, renter so, far. And I am vaguely aware of the control/ordinances, etc. government impose on property owners --many for the greater and one's own good. But at some point it becomes too much. My favorite is the old window tax they used to collect in France, among other places, centuries? ago. People boarded up their windows.

I also am very wary of the Chavezist instinct to blame property owners and businesses for the faults and failings of bad government planning and policies.

ap36• 10 years ago

Denver is currently trying to raise property taxes to subsidize builders and ease purchase pain of new homeowners who currently cannot afford to buy for example

Sadly there is nothing new in politicians coming to take away more of your money & rights

pbreit3• 10 years ago

Your rental agreement (or HOA regs) almost certainly forbids short term rentals.

ubernostrum• 10 years ago

politicians dictating what you can and cannot do with your property

OK, let's completely legalize Airbnb-style temporary rentals... but make the host bear the full cost of it. Not the small fraction of the cost the host thinks about, but the actual cost with all the externalities factored in.

Because really the only way Airbnb works is if it offloads significant costs onto unconsenting and often unaware third parties. And all those goshdurned gubmint regulations? They bring the cost of running a hotel-like business into line with, well, the actual cost of running a hotel-like business. But we can replace them all with just a single charge if you like.

mc329• 10 years ago

Do we want to go down the externalities rabbit hole? Do we tax people who cannot knowingly fiscally responsibly afford to have kids more because their kids cause tax externalities that people who don't have kids have to bear (school, food, health subsidies, quality of life impact, etc.)?

tedmiston4• 10 years ago

David Campos, a supervisor who has been harshly critical of Airbnb, called the ordinance a "modest piece of legislation," according to the San Francisco Chronicle, adding "If you are a rental car agency, you have to make sure the person that you rent that vehicle to has a license before you rent them a car. That is exactly what we are asking the short-term platforms to do here."

This analogy is obnoxiously flawed.

rental car agency:consumer != (airbnb:host or host:guest)

epmatsw• 10 years ago

Genuinely curious why the agency:consumer::host:guest is flawed. (agency|host) temporarily allows use of their property by (consumer|guest) in exchange for money.

dkuebric• 10 years ago

Under your analogy, the host has to make sure the guest is licensed, which is different from the law, which is about the host.

jhchen• 10 years ago

Driving a car is a complex and potentially dangerous activity, hence the license. A license to rent a place to sleep makes no sense.

Edit: Instead of responding to every single sub comment I will just add that car accidents kill 30,000 people a year. Whether or not you think AirBnB should be regulated, the analogy pairing their activity to the commonly fatal activity of driving is unambiguously on a different level. A more appropriate analogy is perhaps a fishing license.

abannin8• 10 years ago

See my post above

pbreit3• 10 years ago

If that analogy (sensible, imo) is too much for you then pretend he was talking about GetAround.

tedmiston4• 10 years ago

To substitute a p2p car sharing service in place of car rental agency completely changes the meaning...

Driving a vehicle (your own or renting someone else's) is an activity requiring a license for the agency to validate.

I'm unaware of any place in the world requiring a license to sleep and eat breakfast.

rahimnathwani5• 10 years ago

How is the analogy flawed?

Rental car agencies ensure drivers (who use the agency's cars) are licensed.

AirBnB is being asked to ensure hosts (who use AirBnB's platform) are licensed.

tn132• 10 years ago

Driving car requires license for various other reason all of us agree with. I don't see why hosts need a license.

Also there is potential stupidity of passing regulations that people wont respect any ways.

BurningFrog3• 10 years ago

There are two parties in the rental car transaction:

    Hertz <-> Driver

The AirBnB transaction has three parties:

    AirBnB <-> Host <-> Guest

While you can construct sentences that look similar for both cases, and the word "license" is used in both contexts, it's a fundamentally different dynamic.

mikeryan2• 10 years ago

David Campos' poor analogy has pretty much zero relevance to the case at hand.

HillRat• 10 years ago

Hm. Okay, perhaps a better analogy might be the way gun manufacturers are expected to ensure they're selling to licensed gun dealers.

abannin8• 10 years ago

The analogy would imply that hosts should verify that guests have a license to rent. Last I checked, there is no license to rent.

A much better analogy would be a franchisor has a responsibility to ensure a franchisee has appropriate business licensure. However, I do not know where the liability lies in this scenario.

notliketherest• 10 years ago

I love to see individuals and companies step up and fight against the psychopaths that run San Francisco.

youngButEager2• 10 years ago

100% agree.

The "control them, tax them, make them lick our boots, what can they do?, they can't do anything about it" mentality is heavy in the SF city leadership.

Believe it or not, some people -- lots of people, actually - are 1000% okay with that. Too many in SF, that's for sure.

Campos wants:

- to be seen as someone who helped the City make more money from the fines and registration requirents

- to appease the vast majority of renters in San Francisco who feel that no owner has a right to their property, the City must be in control -- Campos' voting bloc consists of that group

The problem with objectively dictatorial behavior from government is no one has the guts to stand up to them.

EXCEPT AirBnB!!!

GO AIRBNB !!

Britain just told Merkel and Hollande (who are the real string-pullers in the EU) to scrap off and die.

Tyrannical behavior from people "who tell you what to do and you can't do anything about it" usually ends badly for the perps.

See Nicolae Ceausescu for example. https://www.youtube.com/watch?v=DD-XNTVgDW0

Sometimes people who abuse their power do not lose it gracefully.

Many of us are watching what becomes of Maduro in Venezuela. The entire population there is out of food and rioting and eating dogs and cats.

good_sir_ant• 10 years ago

Most tech grunts will never admit that the idea of 'central planning', or 'regulations', are flawed beyond benefit, as far as we yet are able to implement them, especially in the 'motherland'. When you we start shaking this idea that these restrictions actually benefit anybody besides the ones making the restrictions.

holografix• 10 years ago

Can't help but think of the obvious time and time again with the faux-sharing economy. Sharing is a pathetic use of neural linguistics, you're not sharing, your not doing anyone a kindness, you're making money and you're providing a service.

Uber and Airbnb will be regulated legislative or through unions. Ask yourself just wtf are cabs so much more inefficient than Uber and hotels more expensive then Airbnb?

Few drivers depend completely on Uber for their income, Airbnb is still on a legal gray zone.

This won't last forever. Uber drivers will unionise, tenants who live around Airbnb hosts will pressure the government for legislation and so will hotel providers.

Uber is pivoting to logistics. What's Airbnb doing? Wouldn't surprise me if they soon build their own hotel.

mc329• 10 years ago

My recollection might be off, but I think the term was popularized by the tech press not so much the tech companies described as such.

However, the argument can be made that the sharing, while not in the classical sense, does reduce the impact on resources through efficiencies. So in that sense, people are sharing resources (as in sharing a bus ride --you both pay) and making less impact on earth's resources.

Small cab companies in that sense were more inefficient, among other things, because an idle car (one without a medallion) could be put to use to taxi people around. Same for AB&B. People arguably maximize the use of a house --by renting their spare rooms (the use case has morphed since inception, granted). I think you can see where this model, whatever it's called makes more efficient use of our resources.

r00fus• 10 years ago

Tech press? Where do these outfits get their talking points? Hint: http://paulgraham.com/submarine.html?ref=ep

wool_gather3• 10 years ago

This is true given that ride sharing is actually displacing under-used personal vehicles (and/or taxis), and not higher-efficiency public transit, or other alternatives. (Suzie goes across town to a bar every Friday night now because she can take an Uber. She used to just walk up the street to the one near her house.)

I don't know whether it is or not (and I assume the answer is different in different places), but it bears mentioning.

collyw2• 10 years ago

I would argue that Airbnb is doing the opposite. Using residential housing for tourists, reducing the supply, when perfectly good hotels are available.

freyr• 10 years ago

[why] are cabs so much more inefficient than Uber...? Few drivers depend completely on Uber for their income

Also, few cab companies subsidize rides with borrowed money in the name of growth.

spikels• 10 years ago

Sharing may not be the best name but there is clearly value to be gained by using valuable assets like cars, housing and spare time more intensively. What's fundamentally wrong with this?

bobthepanda• 10 years ago

Housing has the issue that someone who is there for a few days at most does not really have any incentive to care about their neighbors or the property they are staying in. Most people would not buy an apartment next to a hotel room.

DanBC2• 10 years ago

It's not "spare" housing. People who buy apartments for use with AirBnB are reducing the housing stock available to people who want long term rents or to buy to live.

geebee• 10 years ago

Well, this is the angle that airbnb likes to push, that people are renting out a "spare" bedroom that wouldn't otherwise be used, or are renting out their place while they're on vacation. In other words, there is no displacement, there is just efficiency.

Unfortunately, it doesn't seem to be working out that way - housing that was used for permanent residence is now getting converted into airbnb rentals. People are now acquiring properties in order to have a "spare room" - ands those "spare rooms" would absolutely be occupied by a long term resident if they were not being used as short term hotel-like rentals. For instance, people are now using the anticipated income from a spare kid's bedroom to outbid a person who would have otherwise used that bedroom for, well, a kid. Kids cost a bundle, and they don't pay anything like a well heeled tourists for the right to occupy their bedrooms. In a place like SF, where everything goes to a bidding war, a family with the extra costs of kids has very little hope going up against an investor who plans to convert the house into a hotel.

BTW, I absolutely agree that some of this really is efficiency (spare rooms, people on vacation). But at this point, I think it's pretty clear that airbnb is driving displacement and conversion on a large scale.

It is immensely reasonable (yes, in my opinion) for cities to pass laws that ensure a proper mix of housing, including housing for families with children. These laws are not obsolete just because someone wrote a Rails app where you can type in an address and click a "Create Hotel" button.

I overwhelmingly agree that SF needs to build more, but I don't think this basic reality will change. SF's population of children has plummeted in my lifetime, from about 22% to below 14% now. Airbnb is hardly the only factor, but I believe it is making the problem worse.

bduerst2• 10 years ago

I don't think unionization will be possible with Uber drivers. Uber doesn't own the cars and doesn't technically employ the drivers (in most states) - so there isn't any way for the Uber drivers to organize, collude, and force ranks.

mkhpalm• 10 years ago

Plus, its fairly well set up for "scabs" to make anything unionized ineffective. Uber will just respond: "no thanks" to any union strikes. Without the union colluding with the city or state governments to monopolize or cartel the industry... Part time drivers will just see "surge pricing" and "more pickups" to make part time easy money on.

bogomipz• 10 years ago

neural linguistics? Care to elaborate?

telotortium• 10 years ago

He might be thinking of https://en.wikipedia.org/wiki/Neuro-linguistic_programming.

Bombthecat• 10 years ago

Why should they unionize ? There are so many firms and corps and people who should do that. But they don't.

Why should they be different?

techtosser1• 10 years ago

They must be extremely dependent on these commercial operators listing multiple units, else they wouldn't be fighting this so hard.

It kind of makes their whole "helping the middle class" shtick even more nauseating.

abannin8• 10 years ago

Kinda surprised that no one is debating jurisdiction here. Why federal and not state courts? Are federal judges more friendly to this type of case?

wvenable2• 10 years ago

Isn't it federal law that they are using to defend against this?

abannin8• 10 years ago

Yes, but there is a tactical decision at play here. AirBnB seems to believe that it has a better chance of winning on privacy and user-generated content issues then state/local laws.

youngButEager2• 10 years ago

Good point. And the Federal court may actually stipulate that by saying "this is not a matter of Constitutional rights -- it is merely a challenge to a local ordinance and must therefore be contested in that jurisdiction."

AirBnB probably knew they'd lose locally, so either they thought "we'll end up appealing anyway, let's go right to the Feds" or "let's make a longshot stab at a 1st Amendment rights claim and avoid the local court."

They stand to lose at either level, because the SCOTUS has already weighed in on "the local government took unlawful control over my real property" -- a rent-controlled NYC landlord's case was turned down by the Justices a couple years back from even being considered in the Supreme Court.

And there are standing regulations already in place for hotels and motels.

AirBnb doesn't have a chance here, really.

The faux taxi services are somehow skating from being held to the bar for being illegal taxi services, but probably not for long.

underbrowny• 10 years ago

This is the biggest problem of sharing economy. To solve this problem we have to make new system not to fight with established system.

Airbnb Is Suing San Francisco to Block Rental Rules

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