Aimco sued Airbnb to stop Airbnb from providing booking, payments processing, and travel support services to Aimco's tenants at four of its residential apartment communities in Los Angeles County, California. As Airbnb has surged in popularity since 2014, a minority of Aimco's tenants have turned to Airbnb to rent out their apartment homes over Aimco's objections and in violation of their lease agreements.
The vacation rentals have resulted in significant problems for Aimco and Aimco's full-time residents, including loss of resident satisfaction due to disruptions and safety concerns, loss of Aimco's control over and right to exclude unauthorized persons from the properties, continuous trespassing by unauthorized Airbnb “Guests," and reputational and business harms. Airbnb has actual knowledge of Aimco's prohibition of vacation rentals, but does not care and does nothing to enforce its own terms of service against breaching tenants. Rather, Airbnb has made the business decision to broker rental transactions regardless whether the tenant has the landlord's permission and regardless whether the tourists—Airbnb's own customers—are denied access to their vacation accommodations because they are unwittingly trespassing on Aimco's property. Airbnb refuses to stop inducing Aimco's tenants to breach their leases because its continued success and rapid growth depend on ignoring the rules governing the properties they broker and because Airbnb believes it can wield the CDA to shield itself from liability from any claims.
Judge Gee agreed with Airbnb. The Court granted Airbnb's motion to dismiss with prejudice, treating the CDA as an insurmountable barrier to litigation against Airbnb by aggrieved property owners. The Court did not address whether Airbnb's trampling of private property rights and interference with contracts is legal under California law. Instead, the Court ruled that section 230(c) makes Airbnb immune from any liability under state law because “Airbnb hosts who use Airbnb's website have complete control over the content at issue—listing rentals in violation of Aimco's leases" and “it is with Airbnb's publication of this content that Aimco takes issue." 2017 WL 6799241, at *7-8.
The Court made a number of fundamental errors in granting Airbnb's motion to dismiss without leave to amend the complaint, including (i) ignoring the plain, narrow language of subsection 230(c)(1) defining the limited scope of the Good Samaritan defense; (ii) relying on a non-binding case (from the First Circuit) and other out-of-circuit decisions applying an overly broad interpretation of the CDA in direct violation of binding Ninth Circuit precedent; (iii) failing to conduct the claim-by-claim analysis required by the Ninth Circuit to properly evaluate the applicability of the CDA defense; Memo to Community Associations Institute and (iv) ignoring the operative complaint's well-pled factual allegations and instead relying on allegations in the original complaint and adopting Airbnb's own factual assertions as true. Aimco is confident that the Ninth Circuit will reverse the LA Park order as contrary to the Ninth Circuit's earlier CDA decisions—namely, Fair Hous. Council of San Fernando Valley v. Roommates.com, LLC, 521 F.3d 1157 (9th Cir. 2008) (en banc), Barnes v. Yahoo!, Inc., 570 F.3d 1096 (9th Cir. 2009), and Doe v. Internet Brands, Inc., 824 F.3d 846 (9th Cir. 2016)—and the federal rules governing motions to dismiss.
Aimco's appeal will challenge Airbnb's and the district court's erroneous position that the CDA gives Airbnb complete immunity from suits challenging its tortious brokering of prohibited vacation rentals. Section 230(e)(c)(1) provides that “[n]o provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider." The Ninth Circuit has made clear that this does not provide “an all-purpose get-out-of-jail-free card for businesses that publish user content on the internet." Internet Brands, Inc., 824 F.3d at 853. Rather, “all businesses, whether they operate online or through quaint brick-and-mortar facilities," must comply “with laws of general applicability" and must “refrain from taking affirmative acts that are unlawful." Fair Hous. Council, 521 F.3d at 1169 n.24. “[W]hat matters is whether the cause of action inherently requires the court to treat the defendant as the 'publisher or speaker' of content provided by another." Barnes, 570 F.3d at 1102. Only those types of claims are barred by the CDA. Judge Gee's order ignores that Aimco's challenge to Airbnb's brokering activities do not rely on Airbnb being treated as the publisher or speaker of another's content and allows Airbnb to continue brokering short-term rentals in conflict with the legitimate interests of those who are attempting to maintain a building's residential character.
Status: Joint Settlement
Brief Author: Steven Weil, Esq. and Dena M. Cruz, Esq.
CAI Amicus Review Panel: Robert Diamond, Esq., Chair of Amicus Committee, Edmund Allcock, Esq. (MA), Laurie Poole, Esq. (CA), and Jennifer Loheac, Esq. (GA)