Schneiderman vows to protect hotel industry against Airbnb

“They are selling to investors they are a hotel network and telling the public that they are not"

From left: Eric Schneiderman and Airbnb founders Nathan Blecharczyk, Joe Gebbia and Brian Chesky
From left: Eric Schneiderman and Airbnb founders Nathan Blecharczyk, Joe Gebbia and Brian Chesky

New York Attorney General Eric Schneiderman blasted short-term rental site Airbnb in his first public remarks about the site Thursday.

Standing before a group of business and political power players at the New York Athletic Club, Schneiderman vowed to protect the state’s “extraordinarily successful” hotel industry, the New York Post reported. He also accused the San Francisco-based startup of misrepresenting its business model to investors as the company gears up for a public offering later this year.

“What they’re telling investors… as they are moving toward an enormous IPO… are things like we just passed Hyatt, we’ve just passed Hilton,” Schneiderman said before the assembled crowd. “They are selling to investors they are a hotel network and they are telling the public that they are not.”

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The remarks came amid state prosecutors’ push for Airbnnb records for hosts illegally renting out their apartments. A New York State Supreme Court judge in Albany heard arguments on the case Tuesday, during which Airbnb pushed for the subpoena to be dropped, but did not issue a ruling or say when one might come.

“We have no problem and we’ve never said if someone wants to rent out a room in their apartment, that doesn’t violate the law,” Scheiderman said at the athletic club event. “What is illegal is running illegal hotels.” [NYP]Julie Strickland