Legal Ambiguity as a Competitive Advantage: Airbnb's Use of Technological Novelty to Avoid Liability
46 Real Est. L.J. 352 (Winter 2017)
29 Pages Posted: 15 Jul 2018
Date Written: December 1, 2017
The peer-to-peer economy has unraveled thousands of years of codal and jurisprudential safeguards that were put in place to protect travelers and other patrons of public accommodations. Several large companies have generated billions of dollars in revenue from property rental without owning any real estate other than their corporate office and the warehouses for their server farms. When called to account for damages suffered by their guests, the companies employ a variety of legal strategies to shield themselves from liability. This paper exposes Airbnb's strategic use of its own technological novelty to pick and choose the legal theory that best serves its interest in any given case. In doing so, the company circumvents established law applicable to traditional lodging suppliers; avoids legal liability for the harm done to its guests; and gains a significant competitive advantage over traditional businesses in the hospitality industry.
Keywords: Sharing Economy, Gig Economy, Airbnb, Lodging, Law, Liability, Business Organization, Transfer of Risk, Hospitality, Novelty
JEL Classification: K13, K22, K23, K11, K10, M38, M21, M14
Suggested Citation: Suggested Citation