Business & Economy

Airbnb sued in latest row over home-sharing in LA

Airbnb said that
Airbnb said that "we strongly oppose real estate speculators who illegally evict tenants."
Airbnb.com

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Home-sharing giant Airbnb is the target of a lawsuit brought by five tenants who say they were kicked out of their Fairfax District apartments so their landlords could rent the units on the company's website for more money.

The lawsuit alleges Airbnb is liable for facilitating the rental of these rent-stabilized units by acting as an intermediary between the landlord and renter.

"As hosts on Airbnb, the landlords had available to them all of Airbnb's support, infrastructure, intervention, investment and participation in undertaking their joint venture into the hotel business," according to the complaint filed Wednesday in Los Angeles County Superior Court.

Airbnb said it could not comment on pending litigation. Company spokeswoman Alison Schumer did say, in a prepared statement, that they "strongly oppose real estate speculators who illegally evict tenants and abuse platforms like ours in search of a quick buck."

The lawsuit also named the landlords Carol Alsman and LSJB Investments as defendants. Neither party could be reached for comment Wednesday.

The landlords are accused of fraudulently removing the tenants. Under the state's Ellis Act, a landlord can evict tenants in rent-stabilized apartments if they take the units off the rental market for at least a couple of years. But the tenants in this case say their former landlords terminated their leases in April 2014, then, within months, put the units on Airbnb. 

The tenants said as a result they were displaced and "left to compete amidst rising rents for the dwindling number of rental units available as long-term tenancies," according to the complaint. On their list of asks is the option of moving back into their old apartments, and an unspecified amount of damages.

The plaintiffs are Carrie Kirshman, Jerome Podczaski, Ronald Fontenot, Nina Giovannitti and Virgil Mascarenha.

The lawsuit is the latest battle over home-sharing in Los Angeles.

Housing advocates complain the growing popularity of sites such as Airbnb and HomeAway have encouraged landlords to convert thousands of long-term rental units into short-term rentals that generate more money per night.

The site's users, meanwhile, have argued they're providing a service for tourists and in some cases, are collecting valuable income that helps pay mortgages on their properties. 

Supporters of the plaintiffs, including the advocacy group Los Angeles Alliance for a New Economy, say they are looking into launching a potential class action suit that would include short-term renters who have paid rent to Airbnb for the units much higher than what landlords are allowed to collect under the city's rent-stabilization law. The plaintiffs say that on Airbnb, the units were going for about $500 a night, compared to what they were paying as long-term renters: about $53 to $87 a night.

The city is addressing the ongoing controversy over short-term rentals by coming up with new regulations. City staff took public comment at a trio of public meetings held across they city in late September and early October. The input will be used to draft a new ordinance.