Written by The Business Journal Staff
(AP) — A federal judge refused Tuesday to immediately block a San Francisco ordinance that would fine Airbnb for booking rentals that were not registered with the city, but he wants to hear more arguments before making a final decision.
U.S. District Court Judge James Donato rejected some of Airbnb’s arguments in favor of a preliminary injunction but said the company may have legitimate concerns about enforcement of the ordinance.
Airbnb said in a statement it appreciates that the judge continued to postpone enforcement of the ordinance and wants to work with the city to “fix the broken system long before the legal process runs its course.”
San Francisco-based Airbnb is the world’s largest short-stay online rental company.
Critics have long complained that its business model encourages landlords to take already scarce rentals off the market.
Airbnb supporters say they couldn’t continue to live in San Francisco without the extra money they make renting out space.
San Francisco allows short-term rentals but requires hosts to register with the city and limit the length of stays.
The city says the vast majority of San Francisco listings on Airbnb are unregistered.
The ordinance passed earlier this year carries fines up to $1,000 per violation and possible criminal prosecution.
Airbnb argued the ordinance would force it to screen and remove listings because the company would not want listings for units that could not legally be booked. The company said that role would violate a 1996 federal law that prohibits internet companies from being held responsible for content posted by users.
San Francisco officials said the ordinance did not restrict ads on the website, even ads for unregistered rental units. It only fined Airbnb if the company booked the unregistered listing, the city said.
Donato agreed with that argument in Tuesday’ ruling, saying the ordinance does not regulate “what can or cannot be said or posted in the listings” and does not obligate Airbnb to “monitor, edit, withdraw or block the content supplied by hosts.”
“The ordinance holds plaintiffs liable only for their own conduct, namely for providing, and collecting a fee for, booking services in connection with an unregistered unit,” the judge wrote.
Still, Donato said Airbnb might be eligible for an injunction on the grounds that the city does not have a way for it to quickly determine whether a unit is registered. He asked for additional argument from the city and Airbnb.