Last updated: 02:00 PM ET, Wed June 29 2016

Airbnb Sues San Francisco Over New Law

Hotel & Resort | Patrick Clarke | June 29, 2016

Airbnb Sues San Francisco Over New Law

Photo courtesy of Airbnb.

A new law in San Francisco designed to crack down on unregistered short-term rentals listed on Airbnb and other home-sharing platforms has prompted a strong reaction from its hometown company.

Airbnb announced Monday that it has filed a complaint in the U.S. District Court in San Francisco alleging that the law violates the 1st Amendment in addition to the Communications Decency Act of 1996 and the Stored Communications Act.

The recently approved legislation would slap Airbnb and other companies with fines up to $1,000 per each illegal listing, per day. What's more, misdemeanor charges could be brought against companies in violation of the law.

Unanimously passed by San Francisco's Board of Supervisors earlier this month, the law is scheduled to go into effect in August.

READ MORE: How is Airbnb Fighting Racism?

Speaking to, David Campos, who proposed the legislation, compared the registration process to the car rental industry, in which companies are required to ensure the renter has a license before they can drive off the lot.

Airbnb has 7,000 hosts in San Francisco alone, and according to Campos, rougly three-quarters of them have yet to register with the city.

However Airbnb contends that the registration process is broken and confusing and has proposed several ways to improve it, including the creation of an online permit application.

READ MORE: Airbnb vs. Hotel: Which is Right For You?

"This is an unprecedented step for Airbnb, and one we do not take lightly, but we believe it's the best way to protect our community of hosts and guests," the company said in a recent blog post, referring to the lawsuit.

"We believe that creative approaches are still possible and hope that the city will reconsider its current path and work with us towards building a new system that is legal, workable, and fair to everyone involved."

Airbnb's lawsuit against San Francisco comes on the heels of the passage of new legislation in New York that makes it illegal for hosts to list an entire home or apartment for fewer than 30 days.

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