Airbnb lawsuit to block NYC law on short-term rentals is dismissed

4:37 pm Tuesday, August 08th, 2023

By Doyinsola Oladipo

NEW YORK (Reuters) – A New York judge on Tuesday dismissed Airbnb’s lawsuit against New York City over legislation it called a “de facto ban” against short-term rentals on Tuesday.

Justice Arlene Bluth of a state court in Manhattan said it was “inherently rational” for the city to require that hosts register with a local agency, as a means to reduce the thousands of illegal short-term rental listings.

Cities around the United States are more closely regulating short-term rentals, including by requiring hosts to obtain licenses and pay registration fee, or by limiting rentals in business districts.

Airbnb sued New York in June, saying the city’s enforcement of Local Law 18 would make it more difficult for hosts to do business, and effected “its most extreme and oppressive regulatory scheme yet, which operates as a de facto ban against short-term rentals.”

But the judge characterized requiring Airbnb to verify potential listings as a “very simple way” to ensure it was no longer facilitating, and making money from, unlawful activity.

She cited data that the city had received nearly 12,000 complaints about short-term rentals from 2017 to 2021.

“Clearly, respondents have identified a major problem,” Bluth wrote, “and these rules attempt to address that issue.”

The judge added that Airbnb claimed it would have to take down many listings, but offered no proof it stopped or modified bookings for stays after the law was to take effect.

Theo Yedinsky, global policy director for Airbnb, said: “New York City’s short-term rental rules are a blow to its tourism economy and the thousands of New Yorkers and small businesses in the outer boroughs who rely on home sharing and tourism dollars to help make ends meet.”

Airbnb said more than 80,000 guests have booked stays starting on or after Sept. 5, when the law will be enforced. The law was initially set to go into effect in early July but was pushed back to September to give both parties the opportunity to fully brief the issues before the court.