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A federal judge on Thursday blocked a recent New York City law intended to crack down on Airbnb and other online home-sharing sites that city officials say have essentially turned residential apartments into illegal hotels and have aggravated the city’s housing shortage.
The law, which was enacted last summer and was to go into effect next month, would have required online home-sharing services like Airbnb to disclose to the city on a monthly basis detailed information about tens of thousands of listings, and the identities and addresses of their hosts.
But the judge, Paul A. Engelmayer of United States District Court in Manhattan, granted a request for a preliminary injunction by Airbnb and another firm, HomeAway. He wrote the companies were likely to prevail on their claim that the ordinance violated the guarantee against illegal searches and seizures in the Fourth Amendment.
“The city has not cited any decision suggesting that the governmental appropriation of private business records on such a scale, unsupported by individualized suspicion or any tailored justification, qualifies as a reasonable search and seizure,” the judge wrote.
Airbnb said in a statement, “The decision today is a huge win for Airbnb and its users, including the thousands of New Yorkers at risk of illegal surveillance who use Airbnb to help make ends meet.”
The decision could aid home-sharing services in their fight with other cities that have sought to regulate them, putting a limit on how much information local governments can demand.
The ruling dealt a major blow to New York City’s political leaders, Mayor Bill de Blasio and the City Council speaker, Corey Johnson, who had championed the new law as a way of combating rising rents. Mr. de Blasio signed the law in August after it passed the Council unanimously.
“We need that data, because we have to protect people,” the mayor said in a television interview last year.
Mr. de Blasio contrasted home-sharing services with the hotel industry, which is subject to inspections and regulations that allow the city to oversee conditions and hold owners accountable. ”We don’t have that ability with Airbnb until they give us the information that allows us to protect the public interest,” Mr. de Blasio said.
The law was strongly supported by an influential union for hotel workers, the Hotel Trades Council. It was seen as a major victory for Mr. Johnson just months into his tenure as Council speaker.
In a 52-page ruling, Judge Engelmayer did not rule on the merits of Airbnb and HomeAway’s claims, but said that the injunction would block the law from taking effect pending resolution of the litigation, which he said would proceed expeditiously.
The law requires online rental services like Airbnb to disclose the addresses of its listings and the identities of its hosts to the city’s Office of Special Enforcement on a monthly basis. Hosts are also required to list whether the dwelling is their primary residence and whether the entire unit or a portion is available for short-term rentals. Companies that failed to share the data are subject to fines of $25,000 for each listing they did not disclose.
New York City is Airbnb’s largest domestic market, with more than 50,000 apartment rental listings. But under state law, it is illegal in most buildings for an apartment to be rented out for less than 30 days unless the permanent tenant is residing in the apartment at the same time.
City officials hoped the new disclosure requirements would make it much easier for the city to enforce the state law and would lead to thousands of units rented through Airbnb in the city coming off the market.
Airbnb and other home-rental services have been battling regulation nationally and abroad, as cities including Seattle, San Francisco and London have required such companies to share some data through a registration system for listings.
San Francisco, for example, enacted a law in 2016 that fined home-sharing companies if a host rented an apartment through their platforms without registering it first with the city. Airbnb sued and reached a settlement with the city in 2017, under which the company agreed to register hosts with the city automatically and to turn over a monthly accounting of its listings. Listings on Airbnb plunged by half after the rules went into effect.
But the measure New York City passed went further. Rather than set up a registration system, the New York law instead required Airbnb and similar companies to turn over all the information its users had shared with them, including personal information about the people behind the listings.