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Harrington v. Airbnb, Inc.

United States District Court, D. Oregon

October 30, 2018

PATRICIA HARRINGTON, EBONY PRICE, and CARLOTTA FRANKLIN, individually and on behalf of all others similarly situated, Plaintiffs,
v.
AIRBNB, INC., Defendant.

          Nicholas A. Kahl, Nick Kahl, LLC, Joshua L. Ross and Yoona Park, Stoll Stoll Berne Lokting & Shlachter PC, Of Attorneys for Plaintiffs.

          Jeremy D. Sacks, Reilley D. Keating, Taryn K. Williams, and Kennon Scott, Stoel Rives LLP, Of Attorneys for Defendant.

          OPINION AND ORDER

          Michael H. Simon United States District Judge.

         After hearing from the parties on Defendant's motion to dismiss Plaintiffs' putative class action complaint, United States Magistrate Judge Youlee You issued her Findings and Recommendation (“F&R”). Judge You recommended that the Court dismiss the original complaint with leave to file an amended pleading. The Court adopted in part Judge You's F&R, and Plaintiffs filed their first amended complaint (“FAC”). Defendant then moved to dismiss the FAC with prejudice, and Judge You issued an F&R recommending that the motion be granted without leave to file a second amended complaint. Judge You concluded that the FAC did not allege facts sufficient to show that Defendant acted with discriminatory intent, which is required to state a claim under the Oregon Public Accommodations Act (“OPAA”). See Or. Rev. Stat. §§ 659A.403, 659A.885(7). Because Judge You concluded that Plaintiffs did not adequately allege discriminatory intent, she did not reach the question of whether Defendant's business is a place of public accommodation, which is also required to state a claim under the OPAA. Plaintiffs timely objected to the entirety of the F&R concerning the FAC. After de novo review, [1]the Court ADOPTS IN PART AND REJECTS IN PART the F&R at issue and DENIES Defendant's motion to dismiss Plaintiffs' FAC.

         BACKGROUND

         Defendant Airbnb, Inc. (“Airbnb”) is a Delaware corporation, headquartered in California. Charging various fees for its services, Airbnb operates an online platform that connects people looking to rent out their homes (or rooms in their homes) with people looking for accommodations for either lodging or tourism experiences. Airbnb does not own any of the properties that it lists for rent. Instead, it charges fees for processing each transaction (often to both sides of a rental relationship), as well as for providing advertising. In 2016, Airbnb's online platform (consisting of websites and mobile apps) served more than 300, 000 renters in Portland.

         A person offering to rent out a room in his or her home (or offering to rent his or her home) through Airbnb is referred to as a “host.” A host must be registered with Airbnb as a “member.” Travelers who rent rooms or homes from a host using the Airbnb online platform are referred to as “guests.” Although anyone can search the Airbnb database of more than two million properties worldwide, to contact a host online and request a reservation and make a booking, a prospective guest also must be a member of Airbnb, which requires the prospective guest to have an account and profile with Airbnb. Airbnb requires each member's profile to include, among other things, a photograph of the member's face and the member's full name. When a prospective guest sends a request to a host to reserve or book an accommodation listed on the Airbnb online platform, Airbnb sends information to the host about the prospective guest, including the prospective guest's photograph and full name. Although some Airbnb hosts may elect to participate in Airbnb's “instant booking” feature, [2] most hosts require that a prospective guest first request a booking and be approved by the host before the booking transaction may be completed by Airbnb. Many hosts elect to receive booking requests only from prospective guests whose profile includes a photograph. Airbnb would then send the booking request to the host, who reviews the prospective guest's name and photograph. After reviewing the name and photograph, along with other information, the host may confirm, reject, or simply not respond to the request. If a host does not timely respond, the request automatically expires.

         Because Airbnb allows hosts to view the photograph and name of a prospective guest before deciding whether to accept or deny a booking request from that prospective guest, a host can deny a booking request for any reason, including the race or color of a prospective guest. Airbnb is aware that some hosts refuse to rent accommodations to prospective guests on the basis of race or color. Airbnb is also aware that African-Americans are less likely to be confirmed for booking as guests on Airbnb's online platform than are persons who are not African-Americans. Because some hosts refuse to rent accommodations to African-Americans, some accommodations listed on Airbnb's online platform are unavailable to African-American travelers. African-Americans, thus, do not have full and equal access to the accommodations and services offered on Airbnb's online platform.

         Airbnb does not dispute that some Airbnb hosts engage in racially discriminatory conduct. Airbnb asserts that it takes seriously the problem of racial discrimination on its online platform. Nonetheless, Airbnb has continued to maintain its policy of allowing hosts to wait to make a booking decision until after the host has seen the prospective guest's photograph, which discloses the race or color of the prospective guest. Airbnb explains that requiring a prospective guest to include a photograph of his or her face allows a host to learn more information about the prospective guest before deciding whether to accept a booking request from that person. Airbnb states that viewing a photograph of a prospective guest before accepting a booking allows a host to conclude that a guest is “reliable, authentic, and committed to the spirit of Airbnb.” Plaintiffs in this putative class action are African-American women who reside in Oregon and wish to become members of Airbnb and use the services of Airbnb's online platform without being subject to racial discrimination.[3] Plaintiffs, however, are only willing to join Airbnb if they will be able to take full advantage of the accommodations offered on the Airbnb online platform without the risk of racial discrimination based on the inclusion of a guest's photograph.

         Before filing this lawsuit, Ms. Harrington wrote a letter to Airbnb requesting that it change its policies so that all accommodations on its online platform may be available to all prospective guests regardless of race or color. Ms. Harrington specifically asked Airbnb to change its policy that allows a host to wait to confirm a booking until after the host has seen the full name and photograph of a prospective guest. She expressly asked Airbnb not to provide information to hosts before accepting a reservation or confirming a booking from a prospective guest that would reveal statutorily-protected immutable characteristics, like race. Airbnb denied the request to change its policy, but offered to assist Ms. Harrington in securing alternative accommodations if she ever were discriminated against by an Airbnb host. Airbnb also promised to investigate any reported claims of racial discrimination and take appropriate action.

         LEGAL STANDARDS

         A motion to dismiss for failure to state a claim may be granted only when there is no cognizable legal theory to support the claim or when the complaint lacks sufficient factual allegations to state a facially plausible claim for relief. Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010). In evaluating the sufficiency of a complaint's factual allegations, the court must accept as true all well-pleaded material facts alleged in the complaint and construe them in the light most favorable to the non-moving party. Wilson v. Hewlett-Packard Co., 668 F.3d 1136, 1140 (9th Cir. 2012); Daniels-Hall v. Nat'l Educ. Ass'n, 629 F.3d 992, 998 (9th Cir. 2010). To be entitled to a presumption of truth, allegations in a complaint “may not simply recite the elements of a cause of action, but must contain sufficient allegations of underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” Starr v. Baca, 652 F.3d 1202, 1216 (9th Cir. 2011). All reasonable inferences from the factual allegations must be drawn in favor of the plaintiff. Newcal Indus., Inc. v. Ikon Office Solution, 513 F.3d 1038, 1043 n.2 (9th Cir. 2008). The court need not, however, credit the plaintiff's legal conclusions that are couched as factual allegations. Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009).

         A complaint must contain sufficient factual allegations to “plausibly suggest an entitlement to relief, such that it is not unfair to require the opposing party to be subjected to the expense of discovery and continued litigation.” Starr, 652 F.3d at 1216. “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 678 (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007)). “The plausibility standard is not akin to a probability requirement, but it asks for more ...


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