SAN FRANCISCO (CN) - A federal judge Tuesday dismissed vacation rental marketplace HomeAway's lawsuit against San Francisco's so-called "Airbnb law."
HomeAway sued the city in November last year, challenging its law that legalizes and places restrictions on short-term rentals in private homes.
HomeAway claimed that the law, crafted with the help of its competitor Airbnb, discriminates against nonresidents who want to rent homes they own in San Francisco.
The law requires hosts to be permanent San Francisco residents, but many of HomeAway's users list second homes and do not live in the city year-round.
U.S. District Judge Joseph Spero ruled Tuesday that HomeAway lacks standing to sue over the law's residency requirement because the company "is not a party to the transactions that the ... requirement governs."
HomeAway is only a marketplace - it does not oversee agreements about lodging between property owners and renters.
In his ruling, Spero asked out-of-state owners of San Francisco property to tell the court whether they think the law is discriminatory.
"It is for them to decide whether they wish to bring a claim," he said.
Spero also dismissed HomeAway's claim that the law imposes a new obligation for companies like it to collect hotel taxes. Because HomeAway doesn't actually collect any rent, it's not subject to a hotel tax, Spero said.
HomeAway has until Feb. 26 to file an amended complaint, but can only make changes as to its tax claims.
Contact Arvin Temkar at [email protected]