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Airbnb And New York State In Court Today

New York AG Eric Schneiderman has a problem with Airbnb, and the company isn’t a big fan of him either. In October, following Schnedierman’s issued subpoena, Airbnb chose to ignore the subpoena. In November, the AG’s office responded to the company’s refusal.

Airbnb vs New York State: What’s at issue?

“It is illegal for residents of Class A [multiple dwelling] buildings to rent out their apartments for any period of time less than 30 days unless they are also present in the apartment,” Schniderman’s office stated.

Finally, after months of bickering the two will have their day in court. Despite the date being pushed back on numerous occasions, Airbnb has been working on an agreement with the AG to begin collecting taxes on those using its services.

It comes down to New York City’s regulations on who can rent for less than 30 days, and a New York state law that in Airbnb’s eyes prohibits it from collecting taxes that the company estimates would bring the city and state $21 million annually.

Yesterday, Schneiderman’s office filed an affidavit stating that as of the end of January there were 19,522 listings in New York City with 15,677 unique hosts. That means that 1,849 had multiple listings, but they also represent 30% of all listings on the company’s website. Only 1 of those listings required a stay of over 30 days in compliance with New York City’s laws.

Ahead of the inevitable court date Airbnb has been trying to clear up the mess.

CNBC spat yesterday

Earlier this year, we began notifying these hosts that they and their more than 2,000 listings would be permanently removed from the Airbnb community. While we are allowing these hosts to support their existing bookings, all are now prohibited from accepting new reservations,” the company said on its website.

Using CNBC as a proxy to the fight, Airbnb sent an email to the news outlet. “The New York Attorney General continues to say one thing and do another. He says he’s interested in just a few bad actors. If that’s true, he should ask us about them, and he’d find out they are already leaving our site,” wrote the company’s spokesperson Nick Papas.

Matt Mittenthal, a spokesperson for Schneiderman, responded to Papas with the following yesterday on CNBC: “Attorney General Schneiderman has worked in partnership with innovative tech companies like Facebook Inc (NASDAQ:FB) and Yelp Inc (NYSE:YELP) to curb illegal activity on their sites. It’s disappointing that Airbnb has taken a different approach, resorting to name calling and public relations to confuse the issue. Airbnb is simply looking out for its bottom line at the expense of a law that protects quality of life for building residents and safety for tourists.”

While there is no guarantee that the judge will rule today it seems expected by many experts and Airbnb who wrote a letter on Sunday to its hosts, “If we are ordered to hand over any data, we will work to ensure you are properly notified before the government receives any information about you or your listing.” The letter continued, “No matter what happens in the courtroom, we’ll be holding a community meetup in New York City on Wednesday at 7:00 PM and a webinar on Thursday at 11:00 AM.”
The company valued at $10 billion is no stranger to issues with cities over taxes having made changes in both Portland and San Francisco.