Airbnb drops NYC lawsuit after agreement on short-term rental law enforcement

The law, passed by the New York state legislature in June but remaining unsigned by Governor Andrew Cuomo until October, called for fines up to $7,500 for property owners who advertised short-term apartment rentals in buildings of “three or more units.” So it doesn’t apply to someone renting a single room in their home, a basement apartment in a single family home, or even to half of a two-family home. The law was meant for listings on Airbnb and other peer-to-peer sites that had multiple units for rent in what were clearly commercial arrangements and considered “illegal hotels.”

More: Airbnb files federal lawsuit after passage of prohibitive New York bill

Airbnb filed suit because it believed the law’s wording was not clear enough to protect online platforms such as itself, which could not be held responsible for landlords who broke the law. If the listing services were charged, the risks of fines and liability would be more than the companies could bear.

In settling the suit, the city agreed it would focus on individual property owners who violated the law, not the listing companies. New York state attorney general Eric Schneiderman had said the state would not enforce the law, leaving enforcement to the city.

New York City mayor’s office spokesperson Melissa Grace said, “The city will enforce this and other existing laws against bad actors, and appreciates the additional enforcement powers this new tool provides to protect New Yorkers and visitors from unsafe conditions.”

Airbnb agreed, citing the agreement as a way to reassure listing hosts while complying with the law. “We look forward to using this as a basis to finding an approach that protects responsible New Yorkers while cracking down on illegal hotels that remove permanent housing off the market or create unsafe spaces,” Airbnb said.