Imagine owning a building in which you are renting out living space at your set prices and then coming across an advertisement that those same living spaces are available for a nightly, weekly, monthly or even annual fee. The scenario is actually playing out right now for many landlords.
There has been an explosion of online marketplaces listing homes, condos, apartments, rooms and even garages for rent as alternatives to hotels. Many of these listings are posted by individuals (who we will refer to in this hypothetical as “ABBers”) who are renting out their spaces, otherwise referred to as subleasing. Some ABBers have even created sophisticated business models around the online sublease marketplace – forming limited liability companies to engage with subleasers, hiring professional photographers and marketers and even using SEO or search engine optimization to ensure their listing ranks high on customers’ searches. However, quite often, the ABBer has a lease that prohibits such subleases.
What are the legal remedies that they can take to prevent and stop the practice? First, property managers can invoke the breach of the sublease prohibition to begin eviction proceedings. But, ABBers who are profiting from this model can be motivated to resist.
In this scenario, property managers can look to trademark law for a solution. Believe it or not, trademark law – specifically false advertising - has relevance here.