In HomeAway.Com v. City of Santa Monica, 918 F.3d 676 (9th Cir. 2019), the U.S. Court of Appeals for the Ninth Circuit unanimously upheld a Santa Monica ordinance that would force online home-sharing platforms like HomeAway.com and Airbnb to police third-party users’ listings for compliance with city registration laws. Santa Monica’s Ordinance 2535, as amended in 2017, restricts most short-term rentals, with the exception of licensed home-shares. It further requires hosting platforms to refrain from, among other things, completing booking transactions involving properties not licensed and listed on the city’s registry. Violations of the ordinance are punishable by a fine of up to $500 and/or imprisonment for up to six months.

The decision followed an order by Central District of California Judge Otis D. Wright II dismissing for failure to state a claim an action brought by HomeAway.com and Airbnb challenging the ordinance under, among other things, the Communications Decency Act, which shields interactive computer services, including platform providers, from liability for publishing third-party content. See The Communications Decency Act of 1996, 47 U.S.C. Section 230(c)(1) (the CDA) (“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.”), Section  230(e)(3) (providing for the express pre-emption of inconsistent state laws).

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