Airbnb [corporate website] filed suit [complaint, PDF] against New York Attorney General Eric Schneiderman and New York City Mayor Mayor Bill de Blasio in federal court on Friday challenging Senate Bill S6340A, signed by Governor Andrew Cuomo hours earlier, which would impose heavy fines on Airbnb hosts (i.e. homeowners) who break local housing regulations. S6340A serves as an amendment to the multiple dwelling law and New York City’s administrative code, which prohibits homeowners from listing property that fits the category of “Class A Multiple Dwelling,” which cannot be legally occupied for fewer than 30 days, on the Airbnb site or any other similar platform. The bill contains civil penalties of not more than $1,000, $5,000 and $7,500 for the first, second and third violations respectively. Airbnb stated that the law “would impose significant immediate burdens and irreparable harm” on the company requiring it to screen and scrutinize every property that a host seeks to list. The gist of Airbnb’s legal complaint is that S6340A violates the company’s constitutional rights to free speech and due process and the protection offered under the Communications Decency Act—a federal law that says website owners are not liable for content posted by users of the website. Schneiderman stated that “Airbnb can’t have it both ways: It must either police illegal activity on its own site, or government will act to protect New Yorkers” while Airbnb responded: “In typical fashion, Albany back-room dealing rewarded a special interest—the price-gouging hotel industry—and ignored the voices of tens of thousands of New Yorkers.”

Airbnb has been involved in a wave of lawsuits this past year. The company filed similar suits against its headquarter-city San Francisco [WSJ report] and Anaheim in July and Santa Monica [LAT reports] in September, both of which also similarly fined the company for illegal listings. The San Francisco suit was the first of this kind filed by Airbnb where the company sought an injunction to prevent the city from removing listings and fining the company for the unregistered listings. In San Francisco and Anaheim, Airbnb similarly invoked free speech protections of the First Amendment and the Communication Decency Act, while additionally invoking the Fourteenth Amendment’s equal protection clause protections in Anaheim. In Santa Monica, the company made no mention of the Communication Decency Act, but additionally invoked the Fourth Amendment’s protections against unreasonable search and seizures. Both the Santa Monica and Anaheim laws involved a similar 30-day period and violation of the same triggering the imposition of fines. Airbnb’s market value has tripled [NYT report] within a short period of two years to $30 billion, and the company is fiercely challenging any regulation that would adversely affect its host count. New York City is Airbnb’s largest market in the US where Airbnb hosts generated over $1 billion in revenue [NYT report] in 2015.