A group of lawmakers in New York believe there is substantial illegal activity occurring on the room-sharing site Airbnb and they say a federal law is hampering their efforts to stop it. They’d like Congress to step in.
Airbnb’s New York City business is currently under fire from multiple corners amid a showdown in state supreme court over whether the startup will be required to turn over customer records relating to a probe of hotel-tax evasion and zoning violations. On Tuesday morning, a few hours before arguments began in that hearing, a group of local, state, and federal officials held a press conference in Harlem where they blasted Airbnb for attempting to quash a subpoena from New York Attorney General Eric Schneiderman, who has been investigating the site.
All of the five lawmakers at the event said illegal activity on the site is being protected by a key section of federal law that provides tech companies relative protection from liability.
State Sen. Liz Krueger, a Democrat who represents the Upper East Side in Manhattan who attended the event Tuesday, said Section 230 of the Communications Decency Act of 1996 is making things difficult for Airbnb’s opponents in the New York Legislature.
The law states “no 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.” And the federal law trumps any state laws to the contrary.
“We have not been able to find a way as a state government to say, ‘Airbnb, we know you’re breaking laws, and we’re going to stop you,'” Krueger said. “So, frankly, these companies look at me and go, ‘You’re a fly on the wall. We don’t care. You can’t do anything to us. Yes, you can go after the people who illegally rent out the apartments. You can go after the people who illegally rent as tourists. But us, the ones who as their business model are actively encouraging and supporting illegal activity — there’s nothing you can do to us.'”
The law has been repeatedly interpreted by courts as one that provides immunity to web-based businesses, which some argue is an interpretation that reaches far beyond its intended original scope.
A spokesman for Krueger explained the logic of the court’s interpretations: Under the line of thinking, StubHub can’t be challenged for providing access to “scalping,” because they are only the medium by which one user sells to another. In Airbnb’s case, one person is renting to another person and only using the website as a medium. Where that could change, Krueger said, is if someone tries to make the case that Airbnb is a short-term brokerage.
She argued it makes the need for a federal solution more imperative.
“The problem is a national one,” Krueger said. “We have heard horror stories out of San Francisco, Chicago, Boston. … The problem is even becoming international.”
U.S. Rep. Charlie Rangel, the only federal-level official who was present at Tuesday’s press conference in Harlem, said it’s crucial for Congress to take action with new laws designed to regulate Airbnb and other emerging tech companies that have the potential to be used by bad actors.
Rangel said addressing Airbnb’s issues should go hand in hand with efforts aimed at fixing the fact that, in major cities, people are now on average devoting nearly one-third of their income toward their monthly rent.
“We have to. We don’t have a choice,” Rangel said. “The future of America is in the hands of a corporation that’s called the United States Congress. We have a responsibility.”
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