Another Troubling Courtroom Loss for Online Marketplaces–Massachusetts Port Authority v. Turo
Turo is a peer-to-peer marketplace for car rentals. “Colloquially put, Turo is the ‘Airbnb’ of private motor vehicles.” Though Turo doesn’t dictate where the buyer and seller exchange the car, Turo facilitates matches at airports, either by the seller leaving the car in the parking garage or doing curbside delivery. The operators of Boston’s Logan Airport don’t like this. Turo doesn’t pay the fees that other rental car companies pay, and Turo’s sellers can provide services that other rental car companies can’t (like curbside delivery). In this ruling, Logan Airport gets a preliminary injunction against Turo’s operations there.
The court says that Turo’s sellers are trespassing on airport property:
By coming onto Logan’s premises and dropping off or picking up rental vehicles at the airport, including curbside at Logan terminals, RMG and the John Doe Defendants undoubtedly are entering onto Massport’s property without its consent. Even if RMG and the John Doe Defendants’ visits to Logan Airport are deemed to be reasonable in nature (i.e., limited to driving and parking on Logan’s roadways and parking lots for short periods of time), they still can be held liable for trespass
I’m not a real property expert, but I wonder if the legal analysis is so cut-and-dried. The airport is government property, and it is open to the public. Can an airport exclude activity simply by deeming it “without its consent”?
The court then says that Turo may be illegally aiding-and-abetting its sellers’ illegal trespass:
Turo’s own website, which unabashedly touts that hundreds of vehicles (including numerous RMG vehicles) are available for “Airport Pickup” at Logan, establishes Turo’s undeniable knowledge that RMG and other unidentified Turo hosts are regularly entering onto Massport’s property for the purpose of consummating rental transactions with Turo guests. By Turo’s own count, an average of at least ten such transactions happens at Logan each day. Turo also has known, since at least April 2016, that Massport regards each rental car pickup or drop-off at Logan Airport by a Turo host or guest to be an unauthorized violation of Massport’s rights as Logan’s “sole owner and operator.” Accordingly, the Court concludes, without difficulty, that Turo has been aware for several years that RMG and the John Doe Defendants have been committing trespass at Logan Airport.
Turo also participates in and assists RMG and the John Doe Defendants’ acts of trespass at Logan Airport by, among other things: providing the online platform that RMG and the John Doe Defendants utilize to facilitate rental transactions occurring at Logan; explicitly announcing on its online platform that vehicles are available for pickup at Logan; providing RMG and the John Doe Defendants with $1 million of liability insurance for rental vehicles occurring at Logan; and collecting payments from Turo guests for rentals occurring at Logan.
In other words, Turo acts like an online marketplace for matching buyers and sellers.
We normally don’t see state law aiding-and-abetting claims against Internet services. Aiding-and-abetting pretty squarely tries to hold the defendant liable for third-party content/conduct, so Section 230 nominally preempts those claims. But when Turo invoked Section 230, it didn’t go well.
Turo’s assertion of immunity under the CDA is seriously flawed. Massport’s claims against Turo go beyond treating Turo as the “publisher or speaker” of information. The Court already has found that Turo actively participates in and substantially assists RMG and the John Doe Defendants’ acts of trespass at Logan Airport in a variety of material ways, including by accepting and processing payment for their associated car rental transactions. These undisputed facts establish that Turo is, in a very real sense, much more than a mere “publisher or speaker of information.” [cite to HomeAway]
As this ruling reminds us, online marketplaces may not be able to invoke Section 230 for booking transactions. If so, this opens up the door to unlimited liability for a panoply of state law claims we don’t normally see against Internet services–like aiding-and-abetting trespass to real property. I don’t see how online marketplaces can survive the tsunami of existing and to-be-enacted laws regulating booking transactions, one of the several reasons I remain bearish about the future of online marketplaces.
Case citation: Massachusetts Port Authority v. Turo, Inc., 2020 WL 1028822 (Mass. Superior Ct. Jan. 24, 2020). The complaint.