Home-sharing company Airbnb has threatened to sue New York if Gov. Cuomo signs off on a new home-sharing law that would establish heavy fines for tenants that host short-term rentals without being present.
According to Fortune, Airbnb general counsel Rob Chestnut sent a letter to New York Gov. Andrew Cuomo putting the State on notice that if he signs a recently proposed home-sharing law that clamps down on many short-term rentals, it will sue the state. As discussed in an earlier posting on The New York Law Blog, the New York Assembly and Senate passed a bill earlier this summer that would penalize tenants with heavy fines for advertising short-term rentals for less than 30 days in duration while they are not home. In another posting on The New York Law Blog, we discussed a recent case where the court determined that New York tenants in rent-controlled premises are already prohibited from using home-sharing businesses like Airbnb.
The stated intent behind the proposed bill is to protect New York’s hotel industry and owners of multiple dwelling properties by preventing illegal and unregistered hotels from popping up in residential apartment buildings.
Airbnb argues that the language of the bill now pending before Gov. Cuomo does not distinguish between Airbnb and its users, thus violating the Communications Decency Act, which prohibits legislators from sanctioning websites for the content of others. Airbnb also argues that the proposed bill violates First Amendment rights and the Fourteenth Amendment due process rights, as penalties are triggered automatically without Airbnb knowing of any non-compliant posting.
Airbnb has been successful in modifying a similar law in Anaheim, CA based on the Communications Decency Act, but it remains to be seen whether the proposed bill in New York took that modification into account when it was drafted. For now, New York small businesses and individuals that own, operate or manage tenancies should remain vigilant in monitoring tenants who may be listing on Airbnb to ensure that tenants are not abusing the privileges that New York law grants them.
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