Airbnb Arbitration Policy Blocks Guest's Race Discrimination Suit
Updated at 1:27 p.m. EST
Airbnb Inc.’s mandatory arbitration policy prohibits a guest of the rental home-sharing platform from suing over alleged race discrimination, a Washington federal judge ruled Tuesday.
U.S. District Judge Christopher Cooper ruled for Airbnb in a suit in which an African-American guest, on behalf of himself and others, accused the San Francisco-based company of allowing racial discrimination on its home-sharing platform. The plaintiff, Gregory Selden, alleged a homeowner in Philadelphia rejected his request to rent a residence for a weekend getaway because he was black.
Airbnb, represented by a team from Hogan Lovells, argued in Washington last month that Selden knew at the time he created an account with the online platform that he was required to take any dispute to arbitration. Cooper agreed.
“No matter one’s opinion of the widespread and controversial practice of requiring consumers to relinquish their fundamental right to a jury trial—and to forego class actions—as a condition of simply participating in today’s digital economy, the applicable law is clear: Mutual arbitration provisions in electronic contracts—so long as their existence is made reasonably known to consumers—are enforceable, in commercial disputes and discrimination cases alike,” Cooper wrote.
Cooper said “Airbnb’s sign-up procedures were sufficiently clear to place Mr. Selden on notice that he was agreeing to the company’s terms of service when he created an account. While that result might seem inequitable to some, this court is not the proper forum for policy objections to mandatory arbitration clauses in online adhesion contracts. Such objections should be taken up with the appropriate regulators or with Congress.”
Selden’s lawyer, Ikechukwu Emejuru, of the Maryland-based Emejuru & Nyombi, said in a statement that "by placing Mr. Selden’s claims into arbitration, a consumer’s constitutional rights to a jury trial and access to the courts of law continues to be whittled down gradually but surely."
"Airbnb cannot and should not be able to avoid complying with historic public accommodations and housing laws put in place for decades with mere computer software," Emejuru said. "In other words, consumers in a protected class like Selden should not continue to play a guessing game, nor be exhaustively apprehensive about whether they can book a place to stay.
Airbnb, which denied liability, said in a statement Tuesday: "Discrimination has no place in the Airbnb community. We have launched an aggressive effort to ensure our platform is fair for everyone and we will continue to work as hard as we know how to fight bias. We won’t do the bare minimum to address this issue. We have seen how Airbnb can bring people together and our goal is to connect more people from different countries, communities, and cultures.”
Cooper pointed to the commonplace of “check boxes” and “hyperlinks” in which consumers of a service accept the terms and conditions of the company. That someone might not take time to read those conditions didn’t sway the judge.
“To be sure, few people may take time to actually read the user agreements,” Cooper wrote. “But ignorance of the precise terms does not mean that consumers are unaware they are entering contracts by signing up for internet-based services.”
Allegations of race bias against Airbnb have proliferated. The company in September acknowledged shortcomings in a comprehensive report and proposed steps to curtail bias. The home-sharing platform's users must agree to what the company called a "stronger, more detailed" nondiscrimination policy.
Airbnb also said it would “experiment with reducing the prominence of guest photos in the booking process and enhancing other parts of the host and guest profiles with objective information.”
Laura Murphy, who wrote the Airbnb report, praised the company for “putting in place powerful systemic changes to greatly reduce the opportunity for hosts and guests to engage in conscious or unconscious discriminatory conduct.”
Hogan Lovells partners Ellen Kennedy and Sean Marotta, who represented Airbnb in Washington court, were not reached for comment.
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