UPDATE: Last month, the First Circuit affirmed the dismissal of the action, holding that there was no language in Homeaway’s “Basic Rental Guarantee” that makes any representation or warranty that Homeaway pre-screened listings before they were posted, as the document, at that time, simply established a process for obtaining a refund of up to $1000 (subject to certain conditions). (Hiam v. HomeAway.com, Inc., No. 17-1898 (1st Cir. Apr. 12, 2018)). Beyond examining the Guarantee, the court followed the lower court’s reasoning that focused on HomeAway’s business-specific terms and conditions, which expressly notified users that listings are not pre-screened (“[W]e have no duty to pre-screen content posted on the Site by members, travelers or other users”). With dismissal based upon the language of HomeAway’s Guarantee and site terms, the appeals court declined to opine on whether the dismissal was also justified on CDA Section 230 grounds.
In Hiam, the plaintiffs reserved a rental property located in Belize on VRBO.com and thereafter wired two payments to the property manager according to emailed directions. When they couldn’t reach the property manager to confirm the reservation, the plaintiffs contacted HomeAway to express concerns that the listing was fraudulent. After conducting an investigation, HomeAway responded that the listing did not meet their definition of fraud because the owner was a real person who had hosted previous stays; the site also declined, due to privacy concerns, to release the name of the property owner upon plaintiffs’ request. Eventually, someone connected to the rental listing contacted the plaintiffs stating the property was no longer available and arranged for alternative accommodations. Upon their return, plaintiffs brought Massachusetts and Colorado state law claims against HomeAway for alleged monetary losses.
In dismissing the claims, the court ruled that HomeAway is not a “seller of travel services” under Massachusetts law because it merely provides a platform for others to sell or provide lodging, but does not provide actual facilities. Alternatively, even assuming HomeAway was a “seller of travel services” subject to state regulation in that area, the court found that CDA Section 230 would bar this claim as it would attempt to hold HomeAway liable for property listings created by a third-party content provider.
The court also rejected the plaintiffs’ contention that HomeAway’s “Basic Rental Guarantee,” which provided a process to reimburse qualified users for losses due to internet fraud, amounted to a promise to verify listings. Instead, the court ruled that the Guarantee merely provided specified retroactive protection against internet fraud as defined by HomeAway and could not be read to imply a duty to pre-screen postings or verify their accuracy. Furthermore, the court found that HomeAway’s own terms expressly disclaimed the accuracy of third-party listings and exhorted travelers to communicate directly with property owners:
“We have no duty to pre-screen content posted on the Site by members, travelers or other users . . . . All property listings on the Site are the sole responsibility of the member . . . and we specifically disclaim any and all liability arising from the alleged accuracy of the listings….”
“We encourage you to communicate directly with a traveler or member through the tools available on the Site, though even this does not assure you of the identity of the person with which you are communicating. We further encourage you to take other reasonable measures to assure yourself of the other person’s identity and, for travelers, of the property and relevant details of your booking or proposed booking.”