The popular house and apartment rental website Airbnb is suing its hometown of San Francisco over an ordinance which Airbnb claims violates its First Amendment rights. Recently, San Francisco amended the portion of its code dealing with short-term rentals in the City. The new ordinance requires that Airbnb verify that rental owners using its website are registered with the City and have not exceeded a certain number of nights they are allowed to rent. If Airbnb allows noncompliant rental owners to use its website, it could face fines of $1,000 per day for each violation.
Airbnb’s challenge to the ordinance is based primarily on the federal Communications Decency Act, the Stored Communications Act, and the First Amendment. Shortly after filing its lawsuit in federal court, Airbnb moved the court for a preliminary injunction, which would prevent San Francisco from enforcing the ordinance until the court is able to decide the underlying legal issues.
As to its First Amendment argument, Airbnb argues that the ordinance is a content-based restriction on speech. There should be little doubt that the ordinance regulates speech in the form of Internet listings and advertisements. Airbnb claims this regulation is content-based since it requires City enforcement officers to read and evaluate the content of listings to decide whether or not they are in compliance. Airbnb also argues that the ordinance is speaker-based since it targets “housing platform” sites such as Airbnb.
If the court agrees with Airbnb and finds that San Francisco’s ordinance is content-based, the ordinance is presumptively invalid and must satisfy “strict scrutiny.” In order to pass strict scrutiny, an ordinance must be the least restrictive means of accomplishing a compelling government interest. If the government interest is only “important” but not “compelling,” the ordinance will be struck down. Also, if there is a less restrictive alternative the government could have used, the ordinance will be struck down. Strict scrutiny is the most difficult test for an ordinance to pass.
Airbnb argues that if San Francisco wishes to enforce its laws regarding short-term rentals, it should police property owners instead of housing platform sites who do not actually engage in renting properties. Airbnb argues this would be less restrictive since it would not affect the speech of these housing platform sites. Airbnb also argues that the ordinance will not be effective to curtail law breaking by property owners and thus will not advance a compelling government interest.
As of the date of this article, San Francisco had not filed an answer to Airbnb’s motion for preliminary injunction. But it is likely that the City will argue that the ordinance is content-neutral, which would make it subject to the more government-friendly intermediate scrutiny. The City will also likely argue that enforcing the ordinance against housing platform sites such as Airbnb is more efficient and effective to enhance the health and safety of citizens and renters.
While San Francisco certainly has some authority to regulate short-term rentals in city limits, it will likely need to explain to the court why it is necessary for the City to enforce the ordinance against housing platform sites, and not only against property owners. This may be the decisive question on the First Amendment issue. This case is important because it could set the tone for short-term rental ordinances across the country.
The attorneys at Dalton & Tomich, PLC have brought successful First and Fourteenth Amendment challenges against unconstitutional laws and ordinances across the country. We litigate in both state and federal courts. If you feel that a law in your area violates your rights to free speech or equal protection, please do not hesitate to contact us. We would be happy to speak with you.