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First Los Angeles Lawsuit Filed Against Airbnb for Unlawful Ellis Act Eviction

On December 16, 2015, Hadsell Stormer & Renick, LLP filed suit in Los Angeles Superior Court against Airbnb and landlords of a four-unit apartment building in the Fairfax neighborhood of Los Angeles. In the lawsuit, the plaintiffs allege that Airbnb and the landlords violated state and local law by illegally evicting them in order for their rent-control units to be re-rented for short-term rentals at much higher market rates through Airbnb.

The Ellis Act, a California law, was enacted to allow landlords of residential properties subject to rent control to evict tenants and "go out of business." The City of Los Angeles enacted the Los Angeles Rent Stabilization Ordinance to regulate the withdrawal from the market of rental control units and Ellis Act evictions in the City of Los Angeles.

In this lawsuit, as justification for the forced eviction of the plaintiffs, the landlords filed documents with the City of Los Angeles representing that the entire apartment building was being removed from the market for five years. Just weeks after the tenants had been evicted, however, the landlords turned around and re-offered the properties through Airbnb at rates that were as much as ten times the rent they were legally authorized to charge. The plaintiffs have brought claims against both the landlords and Airbnb, as the short-term rental platform, for the failure to re-rent the Fairfax apartments back to Plaintiffs and at their prior rate.

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