AirBnB Sues New York City Claims New Law A 'Violation of Rights'

AirBnB is a peer-to-peer home-sharing network that allows people to rent out lodging space either short-term or long-term. With the amount of homeowners making money out of AirBnB, the bubble was burst when the service was banned in New York.

New York Governor Andrew M. Cuomo recently signed a legislation that imposes penalties of up to $7,500 on AirBnB hosts breaking local housing regulations in the area. This breaks the focal point of AirBnB's mission in helping homeowners make money even while away from home. "The city's hosts generated about $1 billion in revenue last year, and the company took a cut of that amount in fees," writes New York Times.

AirBnB, which is now worth $30 billion, then responded by filing a complaint in federal court preventing the law from being passed. In a Forbes article, "Airbnb claims that the law violates the First Amendment rights of the company and its hosts, as well as the Communications Decency Act of 1996."

AirBnB is claiming that the law is in violation of the Communications Decency Act. This act protects online service providers from content posted by their users. Tech Crunch elaborates that if the law is approved, AirBnB will be held liable for the listings made by third-party platform. AirBnB reports that "the Act unquestionably treats platforms such as Airbnb as the publisher or speaker of third-party content and is completely preempted by the CDA."

AirBnB even went as far as making a proposal for changes to the NYC policies prior to the new legislation like preventing hosts from leasing more than one residence. It will limit short-term leases as well, but the efforts were in vain.

The legislation resulted in the years of battle between New York officials and AirBnB. In fact, in 2013, the state attorney general's office tried to demand information on users of the platform.