The city is seeking up to $2,500 per violation

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Lawsuit accuses Airbnb of violating Californias anti-gouging law by raising rental prices after January wildfires
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Company also allegedly misled users with false claims about verifying host identities and property locations
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City seeks restitution for renters, a permanent injunction, and civil penalties up to $2,500 per violation
Los Angeles City Attorney Hydee Feldstein Soto's office has filed a civil enforcement action against Airbnb, accusing the short-term rental giant of price gouging and deceptive business practices in the wake of the devastating January wildfires in the Pacific Palisades and Altadena.
The lawsuit alleges that Airbnb illegally inflated rental prices on at least 2,000 and possibly over 3,000 properties across Los Angeles after Governor Gavin Newsom declared a state of emergency on January 7, 2025. Under Californias Anti-Gouging Law (Penal Code section 396), it is unlawful to raise prices on essential goods and services, including rental housing, by more than 10% during a declared emergency.
Despite repeated extensions of the emergency order by Governor Newsom, Mayor Karen Bass, and the LA County Board of Supervisors most recently on June 24 the lawsuit contends that Airbnb continued to allow unlawful price hikes on its platform.
Its unconscionable that Airbnb permitted prices to be jacked up on thousands of rental properties at a time when so many people lost so much and needed a place to sleep, said Feldstein Soto. Although Airbnb subsequently took steps to curtail price gouging, evidence indicates that illegal gouging on the site continues and may be ongoing.
Deceptive advertising also alleged
In addition to price gouging, the City Attorneys lawsuit charges Airbnb with deceptive advertising, claiming the company misrepresents that it has verified both the identities of its hosts and the locations of listed properties. The complaint asserts that some so-called verified hosts use false or non-existent identities, and that some properties are inaccurately or fraudulently located.
The lawsuit, filed under Californias Unfair Competition Law, seeks several remedies, including:
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A permanent injunction barring Airbnb from charging unlawful rental rates during the state of emergency
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A ban on false or misleading claims about host verification and property locations
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Restitution to consumers who were charged inflated prices
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Civil penalties of up to $2,500 for each violation
The January wildfires created a surge in demand for short-term rentals as hundreds, possibly thousands, of displaced residents sought emergency housing. Airbnb, with an estimated 80% market share in Los Angeles and $11.1 billion in revenue in 2024, became a critical player in that market.
According to the lawsuit, Airbnb has long been aware that its verification processes are inadequate. Yet the company allegedly continues to advertise a false sense of security to prospective renters. The complaint notes that Airbnb tenants have reported falling victim to serious crimes including identity theft, robbery, sexual assault, voyeurism, and other security breaches linked to misleading host or location information.
City officials say the case sends a message to all businesses operating in disaster-affected regions: profiteering and deception will be met with swift legal action.
Posted: 2025-07-21 00:03:01