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Bucks Blog: A $2,400 Fine for an Airbnb Host

May 21, 2013 by Leave a Comment

Nigel Warren faced steep fines for violations from renting his apartment on Airbnb.Todd Heisler/The New York Times Nigel Warren faced steep fines for violations from renting his apartment on Airbnb.

Back in December, I wrote a column about Nigel Warren, who was facing the prospect of thousands of dollars in fines from New York City for renting his room in a two-bedroom apartment out on Airbnb. A city inspector believed he was breaking the law, but the city ended up dismissing the charges right before the column appeared.

From there, however, the tale took an odd turn. The city revived the charges and set a hearing date for late January. Mr. Warren, appearing on behalf of his landlord, showed up only to find, to his great surprise, that an Airbnb team was there too, including outside counsel it had retained. The company intended to intervene on his behalf, but it hadn’t let him know that it would appear at the hearing.

Because of some confusion at that hearing, the city scheduled a new one, which finally took place on May 9. There, both Mr. Warren and Airbnb argued that certain language in New York’s administrative code allowed lawful boarders, roomers and lodgers to stay in an apartment like Mr. Warren’s for less than 30 days.

An administrative law judge, Clive Morrick, disagreed with their interpretation in a decision he issued on Monday, noting that the Airbnb renters did not have access to all parts of the apartment, specifically the room of Mr. Warren’s roommate, who was still living there while Mr. Warren was away and renting out his room. Mr. Morrick also questioned whether complete strangers staying for a few nights could ever fall under the code language in question.

Airbnb cannot file an appeal, since it was only a “discretionary intervenor” in the case, somewhat akin to a party filing an amicus brief. Mr. Warren, who has told his landlord that he will cover the $2,400 in fines, says that he’s willing to consider appealing if it doesn’t cost him any more money in legal fees and if Airbnb is willing to help him refine and advance his arguments.

But the bigger question here is the same one I asked in my column in December and Airbnb would not answer at the time: Given that Airbnb is well aware that many of its listings in large cities are probably violating local laws, shouldn’t it warn its hosts, with some sort of aggressive pop-up or similar disclosure, when they first post a new listing that they are potentially putting themselves in legal jeopardy?

On Tuesday, Airbnb sent me a statement saying that it plans to start doing just that. Here’s what the warning will say:

“Congratulations! You’re almost done listing your new space and it’s looking pretty sharp! As you’re deciding whether to become an Airbnb host, it’s important for you to understand how the laws work in your city.

Some cities have laws that restrict your ability to host paying guests for short periods. These laws are often part of a city’s zoning or administrative codes. In many cities, you must register, get a permit, or obtain a license before you list your property or accept guests. Certain types of short-term bookings may be prohibited altogether. Local governments vary greatly in how they enforce these laws. Penalties may include fines or other enforcement. These rules can be confusing. Often, even city administrators find it tough to explain their local laws.

We are working with governments around the world to clarify these rules so that everyone has a clear understanding of what the laws are. In the meantime, please review your local laws before listing your space on Airbnb. By accepting our Terms of Service and activating a listing, you certify that you will follow your local laws and regulations.

Many of us at Airbnb are hosts ourselves and we’re passionate about making it as easy as possible to host around the world.

Onwards and Upwards!”

I also asked the company about the possibility of blocking listings from addresses of buildings where residents or the management company have told Airbnb that listings are not legal or welcome. The company had not yet answered this question by the time we published this post.

The company’s approach will probably influence many people in cities like San Francisco and New York, where it has a large number of listings and its hosts have clear legal exposure. The travel news site Skift estimated in January that half of Airbnb’s listings in New York City are illegal. The company did not comment on this estimate.

If you’re already a host in New York, keep in mind that the city still seems only to be conducting inspections at apartments where neighbors have complained about the comings and goings of all the random strangers. But landlords are on to this too, as Fast Company’s Chris Dannen noted last year after his landlord served him with a cease-and-desist order. Most leases prevent the sort of subletting that goes on via Airbnb every day.

Airbnb and other companies hope to clarify or change some of the laws that restrict these sorts of short-term rentals. Here’s what Airbnb said in a statement about that effort and a 2010 law in question:

“This decision makes it even more critical that New York law be clarified to make sure regular New Yorkers can occasionally rent out their own homes. There is universal agreement that occasional hosts like Nigel Warren were not the target of the 2010 law, but that agreement provides little comfort to the handful of people, like Nigel, who find themselves aimed at by overzealous enforcement officials. It is time to fix this law and protect hosts who occasionally rent out their own homes. 87 percent of Airbnb hosts in New York list just a home they live in — they are average New Yorkers trying to make ends meet, not illegal hotels that should be subject to the 2010 law.”

If you’re an Airbnb host who is probably violating local laws, do you intend to keep on renting your room or home out anyway until the legal dust settles, just as Airbnb’s employees seem to be doing?

Article source: http://bucks.blogs.nytimes.com/2013/05/21/a-2400-fine-for-an-airbnb-host/?partner=rss&emc=rss

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DealBook: AT&T Spars With F.C.C. Over Withdrawal of T-Mobile Deal

November 26, 2011 by Leave a Comment

Nothing is easy when it comes to ATT‘s proposed $39 billion takeover of T-Mobile USA — apparently not even when it comes to withdrawing the deal from the government approval process.

ATT’s top internal lawyer, Wayne Watts, said in a statement on Friday that the telecommunications giant should be allowed to withdraw the deal from consideration by the Federal Communications Commission without needing permission from the regulator.

Because ATT withdrew its application for approval before F.C.C. commissioners voted on a proposal by the agency’s chairman, Julius Genachowski, earlier this week to move the case to an administrative law judge, the company should be allowed to pull its submission, Mr. Watts said.

ATT withdrew its application for approval in the early morning hours of Thanksgiving, but said it planned to resubmit the deal for the agency’s consideration at a later date.

The F.C.C. has indicated that its options include granting ATT’s withdrawal, but potentially with prejudice, meaning that the company could not refile for approval later, or moving ahead with the administrative law case.

“We have every right to withdraw our merger from the F.C.C., and the F.C.C. has no right to stop us,” he said. “Any suggestion the agency might do otherwise would be an abuse of procedure which we would immediately challenge in court.”

An F.C.C. representative was not immediately available for comment on Friday evening.

The statement highlights ATT’s growing combativeness as the T-Mobile deal founders amid government opposition. The F.C.C.’s push to hold a hearing on the deal follows a lawsuit by the Justice Department and several state attorneys general seeking to block the transaction.

ATT announced early on Thursday that it planned to record a $4 billion charge in its fourth quarter in case the deal collapses, the company’s biggest acknowledgment yet that the merger is in peril. The charge would cover a majority of a break-up fee owed to T-Mobile’s parent company, Deutsche Telekom, if the transaction fell apart because of regulatory opposition.

Yet the withdrawal of its F.C.C. application signals a hail-Mary legal strategy. ATT is hoping to settle the Justice Department’s claim — or win in court — and use that victory to strong-arm the F.C.C. into approving the merger.

ATT is still exploring ways to settle with the Justice Department, including by selling off assets. But the company has indicated that it is also prepared to do battle in federal district court in Washington, District of Columbia when that trial begins in February.

Mr. Watts’s full statement is below:

Yesterday ATT withdrew its application with the F.C.C. for approval of our merger with T-Mobile. We took the required actions, announced this publicly, and filed securities disclosures accordingly. We believe the record will show that we withdrew our merger application before the F.C.C. voted on the chairman’s proposed hearing designation order.

It has since been reported that the F.C.C. must approve this withdrawal. This is not accurate. The F.C.C.’s own rules give us this right and provide that the F.C.C. “will” grant any such withdrawal. Further, this has been the F.C.C.’s own consistent interpretation of its rules.

We have every right to withdraw our merger from the F.C.C., and the F.C.C. has no right to stop us. Any suggestion the agency might do otherwise would be an abuse of procedure which we would immediately challenge in court.

Article source: http://feeds.nytimes.com/click.phdo?i=64d7fbb90e5200238aeb495dac543909

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AT&T Deal With T-Mobile Takes a Step Back

November 24, 2011 by Leave a Comment

Deutsche Telekom, the parent of T-Mobile, and ATT said in a joint statement that they still intended to pursue the $39 billion merger and would prepare for a federal antitrust lawsuit that is seeking to block the deal.

But the companies also said that ATT planned to take a $4 billion charge against earnings to reflect the potential breakup fees that ATT would have to pay Deutsche Telekom if the deal failed to go through.

The actions followed the decision earlier this week by Julius Genachowski, the F.C.C. chairman, that the merger did not meet the commission’s standard for approval. Mr. Genachowski sent other commissioners a proposed order to refer the case to an administrative law judge, the first step toward a commission move to block the deal, which would combine the second- and fourth-largest cellphone carriers in the United States.

The application withdrawal appears in part designed to prevent the F.C.C. from making public ATT and T-Mobile records about the potential effects of the merger, records that could then be used by the Justice Department in the antitrust trial.

The companies have maintained publicly that the deal would not lessen competition and that it would create jobs in the United States. But the Justice Department has said that the merger would severely restrict competition, and F.C.C. officials have said that ATT’s confidential filings indicate the merger would eliminate jobs.

The withdrawal of the F.C.C. application “is a tacit acknowledgment by ATT that this story is all but over,” said Craig Moffett, an analyst at Sanford C. Bernstein. “The fat lady hasn’t started singing yet, but she’s holding the mike and the band is about to play.”

The efforts by the Justice Department’s antitrust division and the F.C.C. to block the merger reflect a reinvigoration of federal efforts to rein in excessive business practices after a prolonged period of deregulation that preceded the 2008 financial crisis.

President Obama came into office pledging to take a harder look at the antitrust implications of proposed mergers, but the Justice Department was criticized by consumer groups in its first year for appearing hesitant to follow through on that promise.

Similarly, the F.C.C. drew rebukes for its approval last year of the merger between Comcast and NBC Universal, which critics claimed would concentrate too much power over both television content and its transmission to consumers.

The move this week to conduct a hearing on the cellphone deal was the first time the F.C.C. had done so on a merger since the 2002 proposed alliance between Echostar and Direct TV, which ultimately was scrapped.

In this case, however, ATT has noted that expansion of the nation’s Internet infrastructure is one of Mr. Obama’s top goals to help rebuild the economy, and the F.C.C. itself has predicted that its recent initiative to expand broadband Internet access to rural areas would create hundreds of thousands of jobs.

Consumer groups, which generally have opposed the merger, said this week’s combined actions indicated that the deal was falling apart.

“The chances that ATT will take over T-Mobile are almost gone,” Gigi B. Sohn, president of the consumer group Public Knowledge, said in a statement. “While you can never count out ATT entirely, the fact that they pulled their F.C.C. application speaks volumes about the company’s lack of confidence” in getting approval.

Deutsche Telekom, based in Germany, said in a statement that the withdrawal “is being undertaken by both companies to consolidate their strength and to focus their continuing efforts on obtaining antitrust clearance for the transaction from the Department of Justice. As soon as practical, Deutsche Telekom and ATT intend to seek necessary F.C.C. approval.”

ATT issued its own statement saying that the companies were taking this step “to facilitate the consideration of all options at the F.C.C.,” as well as to consider other options.

Edward Wyatt reported from Washington and Jenna Wortham from New York.

Article source: http://www.nytimes.com/2011/11/25/technology/att-deal-with-t-mobile-takes-a-step-back.html?partner=rss&emc=rss

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