Behind the Curtain: The Man Airbnb Wishes to Keep Hidden

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In this podcast, Mark interviews Enrico Schaeffer of Traverse Legal PLC, a lawyer deeply involved in representing Airbnb hosts. Schaeffer discusses his entry into legal disputes against Airbnb, spurred by the company's response to COVID-19 refunds, violating hosts' cancellation policies. 

His firm has handled hundreds of cases, ranging from COVID-related refunds to wrongful suspensions and zoning laws. Schaeffer highlights the power of collective action among hosts for fair treatment and details his efforts in challenging and sometimes aligning with Airbnb on regulatory issues.

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Key Takeaways

Timestamps (audio)


[00:00:00] Mark: In one circumstance, let's say one day you're, you're discussing something and going against Airbnb. And then the next day you could be working alongside them. How, how does that work from a professional scale?

[00:00:11] Enrico: We love Airbnb. We built Airbnb. Did Airbnb go and buy a home and take on a mortgage for its platform to be successful?

[00:00:21] Did they do the cleaning? Did they do the maintenance? Do they do all of that white glove? Five-star service to make the guests happy. No, hosts do all of that work and Airbnb benefits and takes a cut.

[00:00:34] Mark: Having a blast.

[00:00:35] Enrico: Can I get it on the Boosley podcast? Boosley is like Bruce Lee. Cause it's so hard on the T, it is loosely making up those rhymes.

[00:00:42] Don't write it. Just do it loosely. If you want my respect, you'd better put it directly. Here are the words in the podcast. That's what comes next.

Watch this fully

[00:00:51] Mark: So. You will want to make sure you watch this video in full and don't be like doing several things at once. Don't be like washing the pots or driving or whatever.

[00:01:02] You need to pay full attention to this because this chap I'm about to interview is the guy that Airbnb doesn't want you to know about truly. Enrico from Traverse, Legal has been helping hosts and management companies over the last four years, in particular, recover millions from Airbnb and what they did during COVID.

[00:01:21] But on the back of that, he's getting more and more cases now of unlawful suspensions, uh, taken down of listings for some of the craziest reasons. And you, your mouth will drop with some of the things that have gone onto his docket over the past four years. But what's even more interesting to me is what he's now doing where with all of the regulations and zoning laws that are coming in, he's working with Airbnb in some cases to go up against some of the laws that they're trying to come in.

[00:01:50] The main message with this and the main takeaway is collectively a collective startup, a Facebook group, a startup, a WhatsApp group, and the interview. Make sure you watch it for out by the way, but the interview digs into it. It's about 30 to 40 minutes long. Um, but it is very, very, very, very crucial that you do this.

[00:02:08] Uh, because if not, as we said, that the book direct virtual summit, if we don't do this, and if we wait for somebody else, then there is no point in generating direct bookings because there won't be anything in your business to generate bookings for. And that's scary. So without further ado, let's jump into our fascinating interview.

About Enrico

[00:02:28] Enrico: My name is Enrico Schaeffer. I am the founding attorney of Traverse Legal PLC, which is a law firm that I founded in 2004, and my law firm has always been dedicated to, uh, representing technology companies in the, you know, the internet and tech space. So there are a lot of specialized laws that deal with tech companies.

[00:02:49] Um, including platforms, we present companies like Airbnb, uh, on the platform side, software service companies, these types of things. And it just happened to be that when 2020 rolled around COVID hit and every host got that email from Airbnb saying, Hey, we're going to refund all your guests. Even if you have a strict cancellation policy, I had three Airbnb rentals at the time.

[00:03:18] So I got the same email. And I do this work. I understand the terms of service. I understand arbitration. I understand how platforms work. So I ended up getting dragged into this thing because I had this specialized knowledge about what was going on with Airbnb in terms of the platform. I had, uh, several rentals that were going to be affected by the refund.

[00:03:46] And so just out of curiosity, Mark, I just took a look at the terms of service and the extenuating circumstances policy. When I got the email, and at the time, the extenuating circumstances policy said that it covered endemics. And I thought, huh, I wonder what an endemic is so I looked that up and I learned very quickly it was the opposite of an epidemic.

[00:04:08] So, I was like, well it sounds to me like COVID is not covered. By the E. C. P. Therefore, these people should not be getting refunds. I didn't think too much of it and came back a couple of weeks later and noticed that Airbnb had changed the word endemic to epidemic secretly and had tried to essentially defraud Airbnb hosts.

[00:04:30] Pretending that epidemics like COVID were covered when in fact they were not. So that started me down this path of, uh, of really kind of representing hosts and it started with the Airbnb, uh, COVID refunds of which I still have hundreds of cases pending against Airbnb have, uh, arbitrated hundreds of cases, and in the process of all of that, I, you know, ended up developing a reputation as kind of the go-to attorney for hosts.

[00:05:00] Uh, who have issues with Airbnb and property management companies who do Airbnb, this type of thing. And so now I have a lot of other different types of cases. We represent, uh, hosts and, you know, owners, property managers on all of the zoning and condo, uh, regulation issues where all of a sudden, someone's saying you can't be an Airbnb in this particular locale.

[00:05:25] We represent hosts against Airbnb. When there is some sort of adverse action taken by Airbnb against the host, either they refuse to make a payout or suspend or terminate the host from the platform. Um, and the host is trying to get reinstated to the platform because, from the host's point of view, they didn't breach the terms.

[00:05:46] There was no justified reason for removing them. These types of issues. And then, of course, there's the, you know, the disputes that deal with, um, you know, uh, sometimes there's a, there's a, you know, a bogus rating that is provided by a guest that's, that's, you know, doing reputational damage that the host wants to be removed and should have been removed under the Airbnb policies, but was not.

[00:06:10] So it's a whole variety of different We'll You know, litigation, arbitration, and just general business representation of Airbnb hosts.

[00:06:20] Mark: It's still crazy to me, but what, four years later, there are still cases on your docket relating to COVID. Have we got any end in sight when it comes to those cases?

[00:06:32] Enrico: Yes, because as of March 13th, about two weeks ago, the statute of limitations ran.

[00:06:39] And so no further claims could be brought presumably, um, for COVID refunds. So the last cases have been filed and everything's going to run its way through the system. And, uh, you know, we started, we were losing more cases than we were winning. And the reason was, I think because everyone was still traumatized by COVID.

[00:07:02] And so it didn't matter what the law was, didn't matter what the contract said. There were a lot of arbitrators were like. But COVID, you know, was the defence, but COVID, you know, as we got further away from COVID, uh, and everyone just was F U COVID. So the whole thing flipped on its head and now Uh, you know, most, the vast majority of arbitrators look at the contract, look at the ECP, look at what Airbnb did, and, and, and I think I've won, you know, like eight of the last nine cases that I've tried personally of the team of lawyers that we've got trying these things just because It's so obvious that what Airbnb did was

[00:07:43] fraud.

Breaking down the new cases

[00:07:44] Mark: The majority of the new cases that are coming into your docket, into your world and your company. How would you sort of break down the percentages from, let's just say zoning laws to Airbnb kicked you off the platform, T's and C's guests? Like how would you say that the majority of the things that are coming for hosts and management companies are coming to you and saying, team, we need your help here?

[00:08:07] Enrico: So it's a good question. I think that the biggest thing happening right now, honestly, is our municipal regulations, government regulations, and trying to limit short-term rentals in certain areas in neighbourhoods. So that is a trend that has picked up steam in the last 18 months. And, um, you know, we, we get a lot of folks are like, hey, I'm either being selectively enforced because there's a You know 200 other Airbnbs in my neighbourhood and no one's coming after me, or what will often happen is these issues will morph into we help people get organized on a, you know, a geographic basis, get the hosts all banded together, and then challenge the municipal ordinance.

[00:08:53] If it's a condo association issue, we're looking at the condo docs. And, and trying to find where you know the regulation wasn't wasn't put in place properly. So that's a big ticket item that I don't see going away anytime soon. Um, the kind of, the strategy that Airbnb is using and we're aligned with Airbnb on this particular issue is that they're going to the states and in the US.

[00:09:18] And trying to get the states to, um, legislate that municipalities cannot ban short-term rentals. So Florida is right on the cusp of passing such a statute. And so there'll be certain things that you could do permitting and the rest, but you can't just ban short-term rentals. So we'll see how, how that goes.

Working with and against Airbnb

[00:09:38] Mark: There's, there are loads to unpack there. One thing that I found that was really interesting. Is that you've got, um, with, with certain cases, you are working against Airbnb. But then in some circumstances with the zoning laws, you're working kind of alongside Airbnb. How, how does that come down? Like, I can't even begin to imagine, even though I've watched many episodes of, uh, Suits and Billions over the years on the TV, but I can't even begin to imagine how where in one circumstance, let's just say one day, You're, you're discussing something and going against Airbnb.

[00:10:14] And then the next day you could be working alongside them. How, how does that work from a professional scale for you, for yourself? How, how do you even get around that

[00:10:21] Enrico: mentally? Yeah, it's, it's a great question. And the answer I think goes back to something I say to arbitrators all the time, which is.

[00:10:29] We love Airbnb. We built Airbnb. Did Airbnb go and buy a home and take on a mortgage for its platform to be successful? Did they do the cleaning? Did they do the maintenance? Do they do all of that white glove five-star service to make the guests happy? No. Post to all of that work Airbnb benefits and takes a cut as a result, but the partnership that Airbnb that Brian Chesky always promised to host.

[00:11:00] has been an illusion, but that doesn't mean that hosts aren't still pursuing that partnership. That is to say, uh, how much better off would Airbnb be if they treated hosts with respect if they performed the obligations that they contractually agreed to perform, or that they marked it on their home page, Like, is it surprising to people to know that air cover is just a big consumer fraud, that air cover is, if there's any sort of significant claim, it's just fraud, they won't, they won't protect you at all.

[00:11:33] They'll do nothing for you. Um, if someone burns your house down. So, like, why, you know, our big question, why, why are we not on the same team? And so, one of the mantras that I've had since the beginning has been individual hosts are powerless against Airbnb collectively we're bigger than Airbnb, and we're just asking for a seat.

[00:12:03] At our kitchen table. So that's my attitude is like where we can align we align where, where we have to bludgeon the child into submission, so that they aren't being stupid, then that's what we do right and so arbitration is a primary. Tool for people who have properties in the US or are US residents.

[00:12:26] Arbitration is the dispute resolution route, and Airbnb put that in place knowing the vast majority of hosts would never file for arbitration. We, our law firm have filed more arbitrations than all other arbitrations ever filed against Airbnb by hosts, individually, ever. And there's almost no one else out there doing this, but us.

[00:12:50] Um, in terms of representing us, but you don't need us. You can file your arbitration. And that to me is the part of this equation of how we restore balance. To the force. Right. So,

[00:13:03] Mark: um, the best place for people to go. You sent me two links. Um, can you just spell Traverse, legal for everybody, please? Yeah, because my, yeah, it's like pronunciation.

[00:13:13] Enrico: It's like Tra, it's like Traverse, right? T-R-A-V-E-R-S-E legal, L-E-G-A-L, Traverse, Um, but you could also Google like Enrico and Traverse, or Enrico and Airbnb lawyer and I, I've got. You know, probably over 100, 000 pages of content that come back on search. So I'm pretty easy to find folks on the word Enrico.

[00:13:39] Mark: If there's anybody in the U. S. who is just Um, at that point where they need help and guidance, is there any particular, uh, docket you're looking to take on at the moment, any type of client, or are you just saying, listen, reach out, we'll have a chat and if you think it's worthwhile, we'll, we'll take it from there.

[00:13:55] Enrico: Yeah, that's, that's pretty much it. We've got a, uh, since I know what all of the issues are, like, I know, I know what you're going to say, right? I know as long as you tell me the general category. I'm ready to help you right now. I don't need to spend a whole lot of time, you know, trying to figure out what's going on.

[00:14:11] So we've got a, um, a 550 project that a lot of hosts sign up for, which is just You know, I've got this question about, you know, I've been suspended. I need someone to take a look and improve my response. Um, I've gotten, uh, a bad review from a guest that tried to extort me. What are some of my options?

[00:14:36] Right? Um, the, uh, the vacation rental company management company is screwing me over, right? What? So for 550, we'll take a look at background documents that represent you and provide you with legal advice on specific issues. And we can get you a tremendous amount of value at that level. And then sometimes that spins into a bigger representation.

[00:15:02] Uh, sometimes that's all you need to get, you know, from here to there, to understand your issue well enough to know how to navigate it yourself. So I think that that, that, you know, that's probably what I do more than anything is have these one-hour conversations with hosts on specific issues and then send them on their way.

[00:15:18] And, uh, hopefully that's all it takes.

[00:15:20] Mark: Amazing. We appreciate it. You are truly the guy that Airbnb doesn't want to know about and we thank you for your time having a blast. Gonna get it

[00:15:28] Enrico: on the Bruce Lee podcast. Bruce Lee. Let Bruce Lee 'cause it's so hard on the tee's, loosely making up those rhymes.

[00:15:34] Don't write it, just do it loosely.