Selden v. Airbnb, Inc.
Civil Action No. 2016-0933
D.D.C.Nov 1, 2016Background
- Gregory Selden (African American) signed up for Airbnb via an iPhone in March 2015, created a profile with his photo, and inquired about a listing; a host allegedly denied him the listing.
- Selden then created accounts with photos of white men and claims the same host accepted those requests; he sued Airbnb alleging race discrimination under Title II, §1981, and the Fair Housing Act, seeking class relief.
- Airbnb moved to compel arbitration under its Terms of Service (TOS), which Selden allegedly accepted during sign-up; the TOS included a broad mutual arbitration clause and class-action waiver.
- The mobile sign-up screen displayed three sign-up buttons and text reading “By signing up, I agree to Airbnb’s Terms of Service…” with hyperlinks; the TOS spanned multiple pages and contained a “Dispute Resolution” arbitration provision.
- The court applied California law to formation and interpretation questions, treated the motion to compel under the FAA and summary-judgment standards, and heard the parties on whether Selden assented, whether his statutory claims fall within the clause, and whether the clause is enforceable.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Did Selden agree to Airbnb’s Terms of Service? | Selden: sign-up did not give adequate notice of TOS/arbitration (passive assent insufficient). | Airbnb: sign-up screen conspicuously stated agreement to TOS with hyperlinks; clicking to sign up manifested assent. | Held: Selden was on inquiry notice and assented by signing up; contract formed. |
| Do the TOS arbitration terms cover Selden’s discrimination claims? | Selden: statutory civil-rights claims should not be compelled; scope ambiguous. | Airbnb: clause covers disputes “arising out of or relating to” the TOS/use of services—broad scope. | Held: Clause is broad; discrimination claims ‘‘relate to’’ use of Airbnb and fall within arbitration scope. |
| Are Title II, §1981, or FHA claims non-arbitrable as a matter of law? | Selden: statutory text and remedial scheme (esp. Title II) show Congress intended federal-court forum; arbitration undermines civil-rights enforcement. | Airbnb: Supreme Court and D.C. Circuit precedent permit arbitration of statutory claims unless Congress clearly intended otherwise. | Held: No clear statutory bar; arbitration of civil-rights claims is permitted; FAA applies. |
| Is the arbitration clause unconscionable or otherwise unenforceable? | Selden: clause is adhesive, lacks mutuality, and could impose unaffordable arbitration costs. | Airbnb: clause is mutual, Airbnb pays fees except for frivolous claims, and does not meet California’s high unconscionability standard. | Held: Not unconscionable under California law; clause enforceable. |
Key Cases Cited
- Specht v. Netscape Commc’ns Corp., 306 F.3d 17 (2d Cir. 2002) (clarifies inquiry-notice requirement for online agreements)
- Nguyen v. Barnes & Noble, 763 F.3d 1171 (9th Cir. 2014) (distinguishes browsewrap/clickwrap/sign-in-wrap and notice principles)
- Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614 (1985) (arbitration agreements interpreted broadly; statutory claims arbitrable absent clear congressional intent)
- Gilmer v. Interstate/Johnson Lane Corp., 500 U.S. 20 (1991) (arbitration of statutory employment claims permissible)
- Prima Paint Corp. v. Flood & Conklin Mfg. Co., 388 U.S. 395 (1967) (arbitration agreements enforceable and interpreted to cover threshold issues where contracting parties agreed)
- Wolff v. Westwood Mgmt., LLC, 558 F.3d 517 (D.C. Cir. 2009) (resolving doubts about arbitrability in favor of arbitration)
- Armendariz v. Foundation Health Psychcare Servs., Inc., 6 P.3d 669 (Cal. 2000) (California standard requiring both procedural and substantive unconscionability to invalidate arbitration clauses)