Airbnb recently filed suit against San Francisco over a new rule governing short-term rentals, which the city's Board of Supervisors approved last month.
An Airbnb-supported law adopted earlier this year requires short-term rental hosts to register with the city, but it's estimated that only about 20 percent of them -- about 1,400 out of 7,000 -- have done so.
The new rule requires short-term rental listing services like Airbnb to enforce the law by ensuring that hosts advertising on their websites have registered with the city before posting ads online.
When the city flags suspect rental ads, the listing service must respond with details about those properties within one business day -- or incur fines of up to $1,000 a day per listing, as well as face misdemeanor charges.
Airbnb had vowed to fight the rule, and late last month filed suit in United States District Court.
"We believe we are on firm legal footing with this case because this is a piece of common sense legislation that is supported by landlords, tenants, hotels and hotel workers," said San Francisco Supervisor Aaron Peskin.
"We are confident that our city attorney will successfully present our case," he told the E-Commerce Times.
The registration system for short-term rental properties -- which Airbnb had supported -- isn't working, notes the company's complaint.
However, the rule requiring listing companies to enforce registration violates the 1996 Communications Decency Act, it argues.
Congress passed the CDA, Title V of the Telecommunications Act of 1996, with the goal of regulating pornographic material on the Internet. However, the U.S. Supreme Court in 1997 struck down its anti-decency provisions in Reno v. ACLU.
Airbnb's case is based on Section 230 of the Act, which gives immunity from liability to providers and users of an interactive computer service that publishes information provided by others.
There's a dearth of rental apartments in San Francisco, which has sent rents skyrocketing and seen landlords engage in a variety of shenanigans.
For example, one landlord of a North Beach apartment recently raised a tenant's rent from US$1,800 a month to $8,000.
In another caes, landlords reportedly are seeking to evict a tenant for using the appliances in her unit.
Instances like these concerned the Board of Supervisors enough that they unanimously passed the rule requiring short-term hosts to include their license numbers when advertising online.
Introduced by Supervisor David Campos, a long-time opponent of Airbnb, the rule also attracted the support of Supervisor Aaron Peskin, who has fought for affordable housing in San Francisco for years.
"The problem is not the city's motivations but the fact that its method for achieving those goals contravenes Section 230," said Gautam S. Hans, director of the Center for Democracy & Technology's San Francisco's office.
"The courts wouldn't look at the effect on the housing market or anything else when interpreting the [Section] 230 claims," he told the E-Commerce Times. "Airbnb has a strong case given the statute and existing case law."
Further, liability "cannot be based on the presence or absence of a registration number or whether the user can legally offer the service," noted David Greene, civil liberties director at the Electronic Frontier Foundation.
The requirement of specific content -- the registration numbers of advertisers -- "is a restriction based on speech," he told the E-Commerce Times, "implicating the first amendment."