Airbnb sues Mississippi city over short-term rental restrictions (updated)

Airbnb

13/11/2025 21:51

Adds comment from Biloxi in paragraph 4

By Mike Scarcella

Nov 13 (Reuters) - Airbnb ABNB.O and a Mississippi homeowner have sued the city of Biloxi in federal court, alleging it fueled inflated hotel prices by conspiring with a lodging industry trade group to restrict short-term rentals.

The lawsuit, filed on Wednesday in the federal court in Gulfport, Mississippi, alleged Biloxi worked with the Mississippi Hotel & Lodging Association to protect hotel profits by prohibiting short-term rentals in many parts of the popular coastal tourist city and severely restricting them in others.

Airbnb and the homeowner accused Biloxi of violating state and federal antitrust laws.

Biloxi in a statement said its short-term rental ordinances have been in effect for several years and mirror rules adopted in other cities. The city said "it appears that Airbnb is trying to have no rules" for short-term rentals in residential neighborhoods.

The Mississippi Hotel & Lodging Association did not immediately respond to a request for comment. The association is not a defendant.

Airbnb, in an emailed statement, said homeowners have a fundamental right to rent their property on a short-term basis. The restrictions in Biloxi, the company said, are “setting a dangerous precedent for property rights across the country while protecting incumbents from competition.”

The lawsuit is the latest clash between Airbnb and state or local governments that have moved to curtail short-term rentals. In a separate case, Airbnb urged a federal appeals court on Wednesday to reject laws in New Orleans that restrict short-term rentals in the city.

In the Mississippi case, Airbnb is challenging a 2016 Biloxi city ordinance that established a role for the hotel association in regulating short-term rentals. The city is required to send permit applications to the association prior to acting on them.

The lawsuit also said that a hotel executive is serving on Biloxi’s city council, and did not recuse from votes related to short-term rentals.

Average hotel rates have climbed more than 50% since 2015 in Biloxi, according to Airbnb’s lawsuit.

The lawsuit seeks a court declaration that Biloxi’s ordinances unlawfully curb competition, and a permanent order blocking enforcement of the provisions. Airbnb is also seeking unspecified monetary damages.

The case is Airbnb Inc et al v. City of Biloxi, U.S. District Court for the Southern District of Mississippi, No. 1:25-cv-00333-TBM-RPM.

For plaintiffs: Adam Harris and John McMackin of Phelps Dunbar

For defendant: No appearances yet

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 (Reporting by Mike Scarcella)