Chicago homeowners sue city over new regulations affecting Airbnb, home sharing services

Chicago homeowners sue city over new regulations affecting Airbnb, home sharing services

Homeowners in Chicago are suing the city claiming its new "Draconian and unintelligible restrictions" on Airbnb and other home-sharing platforms are unconstitutional and punish homeowners.

According to Airbnb, there are 6,400 Airbnb hosts in Chicago and about 371,000 guests stayed in Airbnb accommodations in the Windy City between 1 November 2015 and 1 November 2016.

The new regulations call for an extra tax on hosts, limit the number of units in buildings that can be rented out and a requirement that hosts maintain records on guests, among other things. This is the second lawsuit filed that challenges the city’s new rules that go into effect next month.

According to the most recent lawsuit filed last week in the Cook County Circuit Court, the ordinance "arbitrarily and irrationally" deprives homeowners of their rights and violates the Illinois and US Constitutions.

"We intend to vigorously defend this suit and the ordinance it challenges, as we believe the plaintiffs' legal arguments lack merit," said Bill McCaffrey, a spokesman for the city's law department, to the Chicago Business Journal.

However, the company itself is not named in the suit. The company is "100% focused on educating the Chicago Airbnb host community about the new rules and regulations passed as part of the June ordinance", according to Ben Breit, spokesman, Airbnb.

In September, Airbnb raised $555m at a $30 billion valuation, according to Fortune. This money came as a part of the $850m funding round that Airbnb filed to raise in August. Google Capital, a unit of Alphabet that invests in late-stage startups primarily for financial gains, and Technology Crossover Ventures, which invests in expansion stage information technology companies, led the deal.

Airbnb has had its share of problems recently. With a new policy needing to be enacted to prohibit discrimination between hosts and guests looking to book a stay, Airbnb fought the City of Seattle in September over home sharing restrictions. The company launched a marketing campaign to combat legislation that would prohibit people from renting out their secondary living spaces for more than 90 days per year and add extra permission forms for those renting their first-homes.

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