Judge says Airbnb user who alleged host bias is bound by online arbitration clause
A federal judge in Washington, D.C., has found an African-American man can’t sue Airbnb over alleged bias by one of the website’s hosts, because suits are banned by an arbitration agreement.
U.S. District Judge Christopher Cooper ruled on Tuesday that plaintiff Gregory Selden is bound by the mandatory arbitration clause in the online user agreement, the New York Times reports.
Selden had signed up with Airbnb and created a user profile that included his photo. When he sought a rental from a host in Philadelphia, he was told the place was not available.
“Smelling a rat,” Cooper wrote in his opinion (PDF), “Selden created a second account under a pseudonym, with a photograph of a white person in the user profile, and contacted the same host about the same accommodation. This time, Selden claims, the host was only too happy to rent the residence.”
Selden’s suit against Airbnb claimed the company is liable under federal civil rights laws for discrimination by the hosts who use its service. Airbnb contested liability and pointed to the arbitration clause, which bans civil lawsuits and class actions.
Selden claimed he didn’t have adequate notice of the mandatory arbitration clause, the clause doesn’t apply to discrimination suits, and the clause is unconscionable. Cooper rejected those arguments.
“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,” Cooper wrote. “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.
“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 told the Times he plans to appeal.
Airbnb announced changes after Selden filed the lawsuit. It now asks its hosts to pledge not to discriminate and it encourages instant bookings that don’t involve host approval of the guest.
