Ethics complaint filed against Supervisor David Chiu and Airbnb’s strategy firm

A group of San Francisco voters plans to file a complaint today alleging a conflict of interest between Supervisor David Chiu, who is running for state Assembly, and a political strategy firm working for the technology company Airbnb.

The League of Pissed-Off Voters plans to file the complaint with the Ethics Commission this morning.

Chiu is running to represent The City in the Assembly against Supervisor David Campos in the Nov. 4 election.

The issue involves Nicole Derse, a consultant on Chiu's Assembly campaign and co-founder of 50+1 Strategies.

Her firm organized the Fair to Share campaign, a collection of Airbnb customers who were encouraged to email San Francisco supervisors to pressure them to pass legislation favorable to Airbnb and other similar home rental websites.

The conflict arises from Chiu's Airbnb legalization resolution, which went before the Board of Supervisors for vote last week. The company, 50+1 Strategies, is not registered as a lobbyist firm, nor are Derse's visits to Chiu logged as lobbyist activity, which the league says are clear ethical violations since her firm dealt directly with Airbnb.

City ethics law requires entities lobbying supervisors to disclose any lobbying activity.

The league also alleges that Chiu did not disclose the relationship between himself, 50+1 Strategies, and Airbnb, which the league contends is also a violation.

“It is indisputable that 50+1 Strategies staff have discussed Airbnb with Chiu,” Cynthia Crews of the league wrote in a draft of the complaint. “The League of Pissed Off Voters calls for the Ethics Commission to expedite their investigation of this matter, publicize their results, and swiftly pursue criminal, civil, and administrative penalties against anyone found to have violated the law.”

Chiu denied there was any impropriety, saying, “There is no conflict, 50+1 is not lobbying, period.”

“I never discussed Airbnb with 50+1 staff engaged with [my campaign],” Chiu said. “I don't think there's even an appearance [of conflict] here.”

Derse also refuted the charge, saying, “We're not lobbyists.”

Ethics Commission records show that registered Airbnb lobbyists have met with Chiu more than 50 times regarding the legislation, but 50+1 strategies was not among them. Derse told The San Francisco Examiner that she created an “ethical firewall” between employees working on Chiu's campaign and employees working for Airbnb.

“Not for one second did I [work on Airbnb legislation],” Derse said. Instead, she said, 50+1 employee Esete Assefa organized on behalf of the company.

Derse forwarded an internal memorandum from 50+1 Strategies describing policies separating employees working on Airbnb and Chiu's campaign, but could not provide verification of when it was sent.

Crews of The League of Pissed-Off Voters questioned 50+1's ability to create an “ethical firewall.”

“It is beyond our comprehension,” she said, “how 50+1 Strategies, a 10-person office, can effectively and ethically create a firewall between lobbying and campaign consulting efforts.”

Ethics Complaint Oct. 21, 2014

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