A federal judge on Tuesday declined to issue a preliminary injunction against a new law in San Francisco that requires short-term rental companies to post on their websites only legal housing listings.
The 18-page ruling by Federal District Court Judge James Donato is not the final ruling in the case, though supporters of the law characterized the ruling as positive.
That’s because the judge, in his ruling, wrote short-term rental companies “have not demonstrated a likelihood of success” in court on the primary grounds they put forth.
The law, introduced by Supervisor David Campos with the support of Supervisor Aaron Peskin, was approved unanimously by the Board of Supervisors on June 14. Mayor Ed Lee did not sign the legislation.
Per the law, short-term rental websites like Airbnb and HomeAway must post registration numbers on listings or email the number and name of the host to the Office of Short-Term Rentals. Fines are up to $1,000 per day.
The regulation prompted the short-term rental companies to file a lawsuit in June against San Francisco in U.S. District Court, which argues that the legislation runs afoul of federal law – the 1996 Communications Decency Act – protecting internet freedom by placing “content-based restrictions on speech by imposing civil and criminal penalties on Airbnb as a result of the publication of content.”
Illegal short-term rentals are widely blamed for exacerbating the housing crisis.
In his ruling, the judge noted that details of how to enforce the new law still need to be ironed out, and requested additional legal briefings to address that.
San Francisco has voluntarily agreed to not enforce the law pending the judge’s final ruling, and will continue to not enforce the law as the final mechanisms for enforcement are finalized, according to the City Attorney’s Office.