After an almost a year-long challenge, hospitality provider Airbnb settles lawsuit with San Francisco over the city’s rental laws.
The online marketplace for vacation accommodation filed a federal lawsuit last year against its hometown.
Airbnb, a housing supplier that famously doesn’t own its own property, has perfected lean manufacturing in the lodging industry.
Furthermore, through acting like a broker it created and now dominates an emerging market for short-term accommodation rental.
Founders Nathan Blecharczyk, Brian Chesky, and Joe Gebbia were struggling to pay their rent when they launched it in 2008.
Today however, the company is worth roughly $30bn.
Airbnb settles lawsuit with San Francisco: Protecting locals
Their unparalleled success is based on the premise that anyone can list and rent their spare space on Airbnb’s website.
In 2016 the company’s lawsuit against San Francisco challenged a local ordinance by the city.
The order threatened to fine short-term landlords utilising the site, and others like it, without registering with the city first.
Additionally, the fines could reach up to $1,000 per user.
Thus, the city effectively moved to prohibit Airbnb from accepting reservations from unregistered hosts.
However, the company fought back by claiming that as an online business, it cannot be held accountable for such listings.
San Francisco’s regulations on short-term rentals are to ensure that landlords don’t prioritise vacationers over local residents.
Commented City Attorney Dennis Herrera in a statement:
“For those who have been turning badly needed rent-controlled units into vacation spots, that is coming to an end once and for all[.]”
Yet, Airbnb seems to have reached a compromise that serves to observe local regulations, and keep business afloat.
Through systems that will take up to eight months to implement, it will share registration information with San Francisco.
Therefore, the city will be aware of any users who are not following its regulations.
As such, Airbnb will strike any user account from its site that proves to avoid city standards.
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