AirBnb

New York's Airbnb Advertising Ban Appears to Violate Federal Law and the First Amendment

From the moment it was passed, it was begging for a lawsuit. It got one.

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Pacific Press/Sipa USA/Newscom

Unions and the hotel industry joined forces to convince New York lawmakers to pass the nation's strictest regulations for room-sharing, but the new law seems to stand on shaky legal ground and is already facing a lawsuit.

"New York is heading straight for the buzz-saw of federal law," says Berin Szoka, president of Tech Freedom, a nonprofit technology policy organization.

The new law, signed a week ago by Gov. Andrew Cuomo, would impose fines of up to $7,500 for advertising rentals with a term of less than 30 days. Technically, those rentals were already illegal—the state had already banned rentals of less than 30 days back in 2010—but the new law is a direct attack on websites like Airbnb and other room-sharing services that connect would-be renters with hosts.

The problem, says Szoka, is that federal law already bars states from doing exactly that. In the Communications Decency Act of 1996, Congress prohibited states from holding online platforms responsible for the speech of their users.

"That safe harbor has been vital for the development of Internet services," he says. "Yet it seems state legislators keep forgetting it exists. That means we keep going round and round the merry-go-round of illegal legislation and pointless litigation."

That interpretation will be tested in court again. Hours after Cuomo signed the law on Friday, Airbnb sued New York over it. The state says it will not enforce the law until the suit is settled.

In its lawsuit against New York, Airbnb argues that the law will impose "irreparable harm" that would stretch beyond the borders of a single state. The lawsuit says it's not clear whether hosts or the online platform would be liable for fines issued under the law.

"In order to be assured of avoiding liability, including potential criminal prosecution, Airbnb would be required to screen and review every listing a host seeks to publish," the lawsuit contends, according to the New York Times.

In a statement, Airbnb said Cuomo was rewarding a special interest—"the price-gouging hotel industry"—at the expense of thousands of New Yorkers who use Airbnb.

The ban could also be challenged on First Amendment grounds, since courts have long held that the U.S. Constitution protects commercial speech as long as it's not fraudulent or criminal.

As I wrote in June when the law was passed by the state legislature, the state might have found a way to get around federal protections for free speech in this instance. Since short-term rentals were already illegal, New York could argue that it's not limiting free speech but rather targeting speech that serves criminal purposes—even if it's absurd that anyone renting an extra bedroom in their home could be considered a criminal.

It's a tenuous argument, but it's probably the only way the New York law will survive a First Amendment challenge. It also has frightening implications. If policymakers are allowed to make an end-run around free speech by making the subject matter of that speech illegal, it could give politicians an incentive to push for more over-criminalization as a means to further restrictions on speech. That's a nasty combination.

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  1. That means we keep going round and round the merry-go-round of illegal legislation and pointless litigation.

    If the only consequence is that taxpayers have to pony up the cost of lawyers or solicitors to argue it, why not?

  2. I’m not sure I’d call litigation pointless when it’s trying to hold back the Zillion Pound Hammer of the State.

  3. Technically, those rentals were already illegal?the state had already banned rentals of less than 30 days back in 2010?

    Get with the new legalism of our times, and just get Clintonian:

    “Depends on what ‘day’ means. For instance, on Venus that could equate to well over 200 earth days. Also, no inertial reference frame was specified, hence no clock we could possibly all agree on to count a day – on any planet…

    …Oh, and I take responsibility for your misunderstanding of the days issue.”

  4. Huh, for $29.99 I can order “Modest Burqini Swimwear” delivered right to my door.

    1. You need to stop serfin the shariah pr0n site.

  5. Not convinced this challenge will win.

    I’m not sure NY, by banning AirBnB ads, is holding AirBnB responsible for the speech of its users.

    Also, commercial speech is second class speech, per a de facto amendment of the 1A by SCOTUS. Far from being immunized against “abridgement”, commercial speech can be abridged by the state based on a “common-sense” distinction between commercial and other speech that SCOTUS pulled out of its ass.

    1. I was going to say, commercial speech protection has been dead for decades. This might be a good test case for NY to get around the Communications Decency Act.

  6. That is so inconvenient. I mean though why should I be able to do anything I want with something I own anyway? That’s just crazy. I need to be told by Top Men always what I can and can’t do.

    1. That having been said, in these United States no individual actually “owns” real property, as there is no allodial title. The 5th Amendment ensures that the Federal government is de facto and de jure the ultimate landlord of all real property in its borders.

      1. This. And if anyone doesn’t believe it, they can try not paying their property tax.

        Owning property has an advantage that you can make minor alterations to the appearance of it without permission from a property owner or the state and eventually stop paying your mortgage. But you can never stop paying your rent to the state. Therefore, private land ownership is a myth here in the great land of the state.

        When did local governments start getting in on this? Wasn’t it in the early 1900s that this started up and just spread to everywhere?

        1. I don’t know about local governments, but Jefferson warned us of this back in his A Summary View of Rights in British America. As far as he was concerned, one of the major grievances the colonists had with the British King is that he refused to grant allodial title to colonial landowners.

          1. That fucking guy.

          2. I think eminent domain is a greater barrier to having allodial title than property tax. The latter, if left unpaid, can become a lien that prevents the sale or transfer of the deed. But the former cannot be squared with an absolute right to property.

            1. The latter, if left unpaid, can become a lien that prevents the sale or transfer of the deed.

              And if the lien goes unaddressed?

        2. Property tax is a lot older than that, but the use of “fair market value” for both land and improvements is fairly recent, I think. A lot of property tax schemes were pretty simple (e.g., based on land area) through the 19th century.

          1. I can’t speak for every state and county in the country, but “fair market value” is a chimera. It’s not real, and the state (at least my state) admitted exactly as much. The “fair market value” is an arbitrary formula designed to give the system a veneer of fairness. The amount of property tax collected has nothing to do with the actual value of the property, it has strictly to do with how much the county or state decided it needed for its upcoming operations. Last year we need a billion, so the ‘fair market value’ of your house is ‘X’. this year we need 1.3 billion, so now the ‘fair market value’ of your house is ‘Y’.

      2. That has been made abundantly clear to me as owners of two different townhouses in Manhattan. The buildings department, the landmarks department etc etc have barely ever let us wash the windows without permits and schedules of inspections ( which they often don’t bother to show up for). Residential properties are regulated like industrial waste sites. Probably more so.

  7. even if it’s absurd that anyone renting an extra bedroom in their home could be considered a criminal.

    New York considers anyone walking the streets to be a criminal until proven otherwise and relieved of all of their cash just in case they were going to do something criminal with it.

  8. Cuomo sort of comes off as a mafioso type. I’m sure it’s just a coincidence.

    1. “Coincidence” is a funny way to say “yeah, he’s been in the room when a dude was kneecapped.”

    2. I’ve been in the same elevator with him a few times. You have no idea.

    3. You don’t get elected mayor of NYC unless you get the nod from the Family.

  9. But, their heart is in the right place, that’s what counts.

  10. And so far nobody’s used the terms “monopoly power” or “prevent competition” in their comments.

    Did all y’all miss the point of the NYC laws?!

  11. If policymakers are allowed to make an end-run around free speech by making possession the subject matter of that speech (such as child pornography) illegal, it could give politicians such as Hillary, an incentive to push for more over-criminalization as a means to further restrictions on speech.
    So dissemination of photo records of Hillary and Bill, committing pederasty on on Billionaire Jeffery Epstein’s “Sex Slave Island.” might subject the whistle-blower to child porn penalties.

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