Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 1 of 47

No. 19-35308
________________________
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
________________________
Rentberry, Inc., and Delaney Wysingle,
Plaintiffs – Appellants,
v.
The City of Seattle,
Defendant – Appellee.
_______________________________
On Appeal from the United States District Court
for the Western District of Washington
Honorable Richard A. Jones, District Judge
_______________________________
Appellants’ Opening Brief
_______________________________
Ethan W. Blevins
Brian T. Hodges
Pacific Legal Foundation
255 South King Street, Suite 800
Seattle, Washington 98104
Telephone: (425) 576-0484
E-mail: EBlevins@pacificlegal.org
E-mail: BHodges@pacificlegal.org

Wencong Fa
James M. Manley
Pacific Legal Foundation
930 G Street
Sacramento, California 95814
Telephone: (916) 419-7111
Fax: (916) 419-7747
E-mail: WFa@pacificlegal.org
E-mail: JManley@pacificlegal.org

Attorneys for Plaintiffs – Appellants

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 2 of 47

CORPORATE DISCLOSURE STATEMENT
Pursuant to Federal Rule of Appellate Procedure 26.1, the undersigned
attorney for Appellant Rentberry, Inc., certifies that Rentberry has no parent
company and no publicly held company holds any stock in Rentberry.
DATE: August 16, 2019.

Respectfully submitted,

s/ ETHAN W. BLEVINS
Ethan W. Blevins
Brian T. Hodges
Pacific Legal Foundation
255 South King Street, Suite 800
Seattle, Washington 98104
Telephone: (425) 576-0484
E-mail: EBlevins@pacificlegal.org
E-mail: BHodges@pacificlegal.org

Wencong Fa
James M. Manley
Pacific Legal Foundation
930 G Street
Sacramento, California 95814
Telephone: (916) 419-7111
Fax: (916) 419-7747
E-mail: WFa@pacificlegal.org
E-mail: JManley@pacificlegal.org

Attorneys for Plaintiffs – Appellants

i

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 3 of 47

TABLE OF CONTENTS
CORPORATE DISCLOSURE STATEMENT ......................................................... i
TABLE OF AUTHORITIES ................................................................................... iv
INTRODUCTION .....................................................................................................1
STATEMENT OF JURISDICTION..........................................................................2
STATEMENT OF THE CASE ..................................................................................2
The Bidding Moratorium ........................................................................................2
Plaintiffs..................................................................................................................5
1. Rentberry .........................................................................................................5
2. Delaney Wysingle ...........................................................................................7
Trial Court Decision ...............................................................................................8
Rental Bidding Report ............................................................................................8
ARGUMENT .............................................................................................................9
I.

Wysingle has standing to press his First Amendment claims .........................9

II. The moratorium violates the First Amendment ............................................15
a.

The moratorium restricts speech by banning online bids ..........................15

b. The moratorium should face strict scrutiny because the moratorium
restricts both commercial and non-commercial speech.............................23
c.

The moratorium cannot satisfy intermediate scrutiny ...............................25
i.

The moratorium does not target misleading speech or speech
related to unlawful activity ....................................................................26

ii.

Suspending speech as a preemptive strike while the City investigates
whether the speech is harmful does not directly advance the
government’s interests ...........................................................................27
1. The City banned speech about pricing without evidence of harm ......28
2. The moratorium does not facilitate the government studies
mandated by the ordinance ..................................................................32
3. The moratorium is underinclusive.......................................................34

iii. The moratorium is more extensive than necessary ................................35
CONCLUSION ........................................................................................................37
ii

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 4 of 47

CERTIFICATE OF SERVICE ................................................................................38
STATEMENT OF RELATED CASES ...................................................................38
Certificate of Compliance for Briefs .......................................................................39

iii

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 5 of 47

TABLE OF AUTHORITIES
Page(s)
Cases
44 Liquormart v. Rhode Island,
517 U.S. 484 (1996) ..........................................................................16, 18, 19, 36
Airbnb, Inc. v. City and County of San Francisco,
217 F. Supp. 3d 1066 (9th Cir. 2016) ...........................................................21, 22
Arizona Right to Life Political Action Comm. v. Bayless,
320 F.3d 1002 (9th Cir. 2003) ......................................................................12, 13
Bill Salter Advertising, Inc. v. City of Brewton, Ala.,
486 F. Supp. 2d 1314 (S.D. Ala. 2007) .............................................................. 14
Brown v. Entertainment Merchants Ass’n,
564 U.S. 786 (2011) ............................................................................................ 34
Central Hudson Gas & Electric Corporation v. Public Service
Commission of New York,
447 U.S. 557 (1980) .....................................................................................passim
Clark v. City of Lakewood, 259 F.3d 996 (9th Cir. 2001) ....................................... 12
Coalition for Icann Transparency Inc. v. Verisign, Inc.,
464 F. Supp. 2d 948 (N.D. Cal. 2006) ................................................................ 29
Conant v. Walters, 309 F.3d 629 (9th Cir. 2002) .................................................... 10
Department of Professional Regulation, Board of Accountancy v.
Rampell, 621 So. 2d 426 (Fla. 1993) .................................................................. 18
Desert Outdoor Adver., Inc. v. City of Moreno Valley,
103 F.3d 814 (9th Cir. 1996) .............................................................................. 11
Edenfield v. Fane, 507 U.S. 761 (1993) ............................................................17, 29
Expressions Hair Design v. Schneiderman,
137 S. Ct. 1144 (2017) ..................................................................................16, 19
F.E.R.C. v. Electric Power Supply Ass’n, 136 S. Ct. 760 (2016) ............................ 20
iv

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 6 of 47

Fireman’s Fund Ins. Co. v. City of Lodi, California,
302 F.3d 928 (9th Cir. 2002) .............................................................................. 15
Florida Bar v. Went for It, Inc., 515 U.S. 618 (1995) ............................................. 32
Foti v. City of Menlo Park, 146 F.3d 629 (9th Cir. 1998) ...................................9, 10
Greater New Orleans Broadcasting Ass’n, Inc. v. United States,
527 U.S. 173 (1999) ............................................................................................ 28
Homeway.com, Inc. v. City of Santa Monica,
918 F.3d 676 (9th Cir. 2019) .............................................................................. 22
Hunt v. City of Los Angeles, 638 F.3d 703 (9th Cir. 2011) ....................................... 9
IMDb.com, Inc. v. Becerra, 257 F. Supp. 3d 1099 (N.D. Cal. 2017) ...................... 30
International Franchise Association, Inc. v. City of Seattle,
803 F.3d 389 (9th Cir. 2015) ........................................................................22, 23
Jim Gall Auctioneers, Inc. v. City of Coral Gables,
Case No. 97-cv-3186-CIV-SEITZ, Order on Cross-Motions for
Summary Judgment (S.D. Fla. 1999) ................................................................. 18
Langdon v. Google, 474 F. Supp. 2d 622 (D. Del. 2007) ........................................ 25
Lopez v. Candaele, 630 F.3d 775 (9th Cir. 2010)................................................9, 13
Lorillard Tobacco Co. v. Reilly, 533 U.S. 525 (2001) ......................................28, 35
Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992) ................................................ 9
Metro Lights, LLC v. City of Los Angeles,
551 F.3d 898 (9th Cir. 2009) .............................................................................. 32
Nat’l Ass’n of Tobacco Outlets, Inc. v. Providence, R.I.,
731 F.3d 71 (1st Cir. 2013) ................................................................................. 16
Nordyke v. Santa Clara Cty., 110 F.3d 707 (9th Cir. 1997) .................................... 19
Publius v. Boyer-Vine, 237 F. Supp. 3d 997 (E.D. Cal. 2017) ................................ 25
Reed v. Town of Gilbert, Ariz., 135 S. Ct. 2218 (2015) ........................................... 24
v

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 7 of 47

Retail Digital Network v. Prieto, 861 F.3d 839 (9th Cir. 2017) .............................. 24
Riley v. Nat’l Fed’n of the Blind, 487 U.S. 781 (1988) .....................................24, 33
Rubin v. Coors Brewing Co., 514 U.S. 476 (1995) ...............................28, 34, 35, 36
Santa Monica Food Not Bombs v. City of Santa Monica,
450 F.3d 1022 (9th Cir. 2006) ......................................................................10, 12
Sorrell v. IMS Health, Inc., 564 U.S. 552 (2011) ..............................................17, 24
Spirit Airlines, Inc. v. U.S. Dep’t of Transp.,
687 F.3d 403 (D.C. Cir. 2012) ............................................................................ 16
Taniguchi v. Schultz, 303 F.3d 950 (9th Cir. 2002) ................................................. 11
Thomas v. Anchorage Equal Rights Commission,
220 F.3d 1134 (9th Cir. 2000) ............................................................................ 14
Thompson v. Western States Medical Center,
535 U.S. 357 (2002) ................................................................................34, 36, 37
Turner Broadcasting System, Inc. v. FCC,
520 U.S. 180 (1997) ............................................................................................ 32
Turner Broadcasting System, Inc. v. FCC,
512 U.S. 622 (1994) ......................................................................................28, 32
Twitter, Inc. v. Sessions,
263 F. Supp. 3d 803 (N.D. Cal. 2017) ................................................................ 12
U.S. v. Playboy Entertainment Grp., Inc.,
529 U.S. 803 (2000) ............................................................................................ 28
United States v. Virginia, 518 U.S. 515 (1996) ....................................................... 31
Universal Studios v. Corley, 273 F.3d 429 (2d Cir. 2001) ...................................... 24
Valle Del Sol, Inc. v. Whiting, 709 F.3d 808 (9th Cir. 2013) ............................26, 34
Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer
Council, 425 U.S. 748 (1976) ......................................................................passim

vi

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 8 of 47

Williams-Yulee v. Florida Bar,
135 S. Ct. 1656 (2015) ........................................................................................ 34
World Wide Rush, LLC v. City of Los Angeles,
606 F.3d 676 (9th Cir. 2010) .............................................................................. 26
Statutes
28 U.S.C. § 1291 ........................................................................................................ 2
28 U.S.C. § 1331 ........................................................................................................ 2
Seattle Municipal Code § 1.04.020(A) ...................................................................... 5
SMC § 5.73 ..............................................................................................................37
SMC § 7.24.020 .............................................................................................3, 20, 21
SMC § 7.24.090(A)..............................................................................................2, 11
SMC § 7.24.090 (B) ...............................................................................................2, 3
SMC § 7.24.090(C) .................................................................................................. 14
Other Authorities
Wu, Felix T., Commercial Speech Protection as Consumer
Protection, 90 U. Colo. L. Rev. 631 (2019) ....................................................... 16
Zillow, About Us, https://www.zillow.com/corp/About.htm
(visited July 16, 2019) ........................................................................................ 13

vii

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 9 of 47

INTRODUCTION
A few startups in 2017 began offering an innovative feature on rental listing
platforms that allowed tenants to place bids on listings. The City of Seattle slapped
a moratorium on the use of these platforms without evidence of harm. The City’s
overzealous reaction to this new platform for speech does not satisfy First
Amendment scrutiny.
The district court held that Rentberry, a web platform that offers the forbidden
rental bidding services, and Delaney Wysingle, a landlord who wishes to use rental
bidding to advertise his property, do not have standing to challenge a law that
directly silences them. Wysingle made clear his intent to use rental bidding for
advertising his rental unit during the summer of 2018, a plan that he still cannot fulfil
thanks to Seattle’s moratorium. He is suffering a concrete injury worthy of federal
court resolution.
The court below also held that the moratorium on rental bidding restricts
conduct, not speech. But bidding is communication about price in anticipation of a
transaction. A ban on bidding thus regulates speech, not the business transaction
itself.
The moratorium cannot survive the intermediate scrutiny demanded of
commercial speech regulations. The City passed the moratorium based on
speculation and conjecture, the moratorium does not serve the government’s asserted
1

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 10 of 47

interests, and the moratorium is more extensive than necessary because there are
ways to address the availability of housing without limiting speech. Seattle’s strategy
of shutting down speech as a first resort does not comport with the First Amendment.
STATEMENT OF JURISDICTION
Pursuant to 28 U.S.C. § 1331, the federal district court had subject matter
jurisdiction over this dispute arising under the United States Constitution. On March
15, 2019, that court issued an order granting summary judgment to the City and
entered final judgment on March 18, 2019. Plaintiffs filed a timely notice of appeal
on April 16, 2019, within 30 days of the final judgment as required by Rule 4 of the
Federal Rules of Appellate Procedure. This Court has appellate jurisdiction under
28 U.S.C. § 1291.
STATEMENT OF THE CASE
The Bidding Moratorium
On March 19, 2018, the Seattle City Council enacted a “one-year prohibition
on use of rental housing bidding platforms.” ER 17; see also Seattle Municipal Code
(SMC) § 7.24.090(B). During that year, “[l]andlords and potential tenants are
prohibited from using rental housing bidding platforms for real property located in
Seattle city limits.” Id. § 7.24.090(A). This rental bidding moratorium defines a
“rental housing bidding platform” as “a person that connects potential tenants and
landlords via an application based or online platform to facilitate rental housing
auctions wherein potential tenants submit competing bids on certain lease provisions
2

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 11 of 47

including but not limited to housing costs and lease term, to landlords for approval
or denial.” Id. § 7.24.020. The ban went into effect on April 29, 2018.
The Ordinance calls upon city agencies to investigate whether bidding
platforms comply with fair housing laws and what impact such platforms might have
on “equitable access to Seattle’s rental housing market.” Excerpts of Record (ER)
19. The results of the study were to be submitted to the City Council before the ban
expired. Id. If, however, the city departments requested more time to complete the
study or the City Council needed more time to review it, the Council was allowed to
extend the one-year ban for another year. SMC § 7.24.090(C).
The original Ordinance expressly conceded that the City “has not … studied”
whether rental bidding platforms harm the rental housing market or defy local
regulations. ER 17. The Ordinance noted only that “it is unclear whether ... these
new services comply with the City’s code, including new regulations such as firstin-time.” Id. The City’s only specific reference to a regulation is the first-in-time
rule struck down as unconstitutional in King County Superior Court in March 2018.
Id.; see also Yim v. City of Seattle, Case No. 17-2-05595-6 (King Cty. Sup. Ct. 2018),
ER 23-32. 1 The City also confessed that “it is uncertain whether and how these

1

The Washington Supreme Court heard oral argument on direct review on June 11,
2019.
3

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 12 of 47

services impact Seattle’s rental housing market, as these services may have different
effects on markets depending on the scarcity of housing supply.” ER 17.
This absence of evidence did not dissuade the Council from taking drastic
action. The City banned the use of the platforms until it decides at its leisure whether
it will allow landlords and tenants to communicate on rental bidding platforms. The
Ordinance says, “[T]he Council wishes to understand new technologies and
innovation that may have impacts on communities throughout Seattle prior to these
new technologies and innovations becoming entrenched without regard to whether
their impacts are in line with Seattle’s values of equity and Seattle’s work toward
expanding access to rental housing.” ER 18. Thus, “the Council wishes to know
more about how these services function and the impact they may have on Seattle’s
rental housing market before allowing landlords and tenants to use them within the
City.” ER 18. A city staff memo to a committee of the Council says the moratorium
serves three purposes: “(1) to study whether these types of services are compliant
with the City’s current laws; (2) to give the City time to create a regulatory
framework if necessary before use of such services proliferates; and (3) to determine
current and potential impacts on Seattle’s Housing Market.” ER 34. The memo
identified two websites as targets of the ban: Rentberry and Biddwell. See id.
The initial moratorium expired at the end of April 2019, with no study
completed. Instead of opting to renew the moratorium as allowed by the Ordinance,
4

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 13 of 47

the City Council passed a substantially similar moratorium on June 10, 2019, which
took effect on July 17, 2019. See Supp. App. 001; SMC § 1.04.020(A) (establishing
effective dates of ordinances). The Council Bill passed by the City Council was
virtually identical to the prior Ordinance, including the findings regarding the City’s
uncertainty about rental bidding’s impact on housing or compliance with local law.
See Supp. App. 004. Differences are minimal: in the findings and whereas
provisions, the Bill noted this litigation and claimed that the “Office of Housing is
conducting the study on rental housing-bidding and estimates it will be completed
in June 2019.” 2 Id. Otherwise, the law itself is identical to the moratorium that was
the original object of this litigation. See id. at 006. Importantly, this means that the
law contains yet another one-year extension option, even though the study mandated
by the City was complete before the new moratorium took effect. See id. at 007.
Plaintiffs
1. Rentberry
Rentberry is a rental listing platform that facilitates communication about
housing and related services. ER 44. Rentberry’s technology is designed to simplify
and reduce the costs of the rental process. ER 44. Rentberry employs various
innovations designed to bring fresh technology to the rental industry. ER 44.

2

In fact, as discussed below, the Office of Housing issued its rental bidding report
on July 3, nearly one month after the renewed moratorium was enacted. Supp. App.
013.
5

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 14 of 47

One such innovation is Rentberry’s proprietary bidding technology. ER 45.
This helps landlords respond to changes in the rental market, while potential tenants
can easily communicate the price they are willing to pay and see competing offers.
ER 45. The bidding feature reduces delay, inefficiency, and uncertainty in the rental
process. ER 46.
The platform allows landlords to post asking prices for rent and security
deposit and solicit bids. ER 45. Applicants can communicate their bid above or
below the asking prices. ER 45. Rentberry utilizes an algorithm to communicate a
recommended bid to applicants, based on market conditions. ER 45. A user can see
details about the highest bid, as well as various characteristics about the high bidder,
such as their credit score, their monthly salary, whether they have pets, and the
number of roommates. ER 51-52. They can also see the average credit score of
individuals interested in that property, as well as an estimation of the overall demand
for that unit. ER 45. Landlords can view all bids submitted and application details,
including background check information provided by Rentberry. ER 52. The bidding
feature is an integral component of Rentberry and landlords listing property on
Rentberry cannot post a fixed price or refuse to allow bids. ER 45. Landlords retain
the right to select any bidder or no bidder. ER 45.
Rentberry’s website provides a search engine that allows registered users to
filter searches for housing by price range, housing type, number of bedrooms,
6

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 15 of 47

amenities, and so on. ER 46. Search results display customized advertisements
posted by landlords, which can include photographs, descriptions, and rental criteria.
ER 46. After finding a desirable listing, potential tenants submit their bids and
complete the application process on the Rentberry site. ER 49. Rentberry also
provides a forum for landlord-tenant communication, maintenance requests, and rent
payment. ER 46.
2. Delaney Wysingle
Delaney Wysingle owns and rents out a single-family home in Seattle. ER 41.
After inheriting the home in 2015, he rented it out to a single tenant from June 2015
to February 2018. ER 41. He then renovated the house from March through August
4, 2018, during which time the house was vacant. ER 42. If not for the moratorium,
Wysingle would have advertised his property and selected his next tenant through a
rental bidding platform. ER 42. Instead, he used Zillow to find a tenant who has
occupied the property from August 2018 to the present. ER 42. Wysingle renewed
the current lease in June 2019 rather than advertising the property, in part due to his
inability to make use of all available advertising platforms because of the
moratorium. Supp. App. 0046.
The current lease term on Wysingle’s property terminates on June 30, 2020,
several weeks before the moratorium’s expiration. See Supp. App. at 46. If the
current lease is not renewed, Wysingle wants to use Rentberry, including the bidding
7

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 16 of 47

feature, to advertise his property in advance of the June lease termination. Id. He
cannot do so, however, because the moratorium will be in effect at that time. See id.
at 46. Wysingle wants to experiment with rental bidding platforms because he
believes they help landlords and tenants to settle on rent based on fair market value.
ER 42. Wysingle would be willing to accept a bid below his asking price if the
applicant seemed qualified. ER 42.
Trial Court Decision
The parties filed cross-motions for summary judgment in late 2018. On March
15, 2019, the district court issued an order granting the City’s motion. The court held
that plaintiffs lacked standing to bring a First Amendment claim, and the First
Amendment was not implicated because the moratorium regulated conduct, not
speech.
Rental Bidding Report
On July 3, 2019, the Office of Housing issued the report on rental bidding
platforms mandated by the Ordinance. See Supp. App. 013-024. The eleven-and-ahalf page report draws no conclusions about either rental bidding platforms’
compliance with other laws or whether rental bidding platforms will inflate housing
costs. See id. Despite the report’s lack of conclusive evidence, the report
recommended that the City modify the moratorium “to be effective in perpetuity, or

8

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 17 of 47

until rental bidding platforms can affirmatively demonstrate compliance with all
federal, state and local laws, and fair and equitable operations.” Id. at 024.
ARGUMENT
I. Wysingle has standing to press his First Amendment claims
To establish standing, a plaintiff must show that he has (1) suffered a concrete
and particularized injury in fact that is actual or imminent, (2) that is fairly traceable
to the challenged conduct of the defendant, and (3) that is likely to be redressed by
a favorable judicial decision. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 56061 (1992). Plaintiffs may establish injury-in-fact before suffering direct injury from
the challenged restriction. See id.
This Court has held on many occasions that “First Amendment cases raise
‘unique standing considerations’ … that ‘tilt[] dramatically toward a finding of
standing.’” Lopez v. Candaele, 630 F.3d 775, 781 (9th Cir. 2010) (emphasis added,
citations omitted). In First Amendment cases, facial constitutional challenges come
in two varieties: First, a plaintiff seeking to vindicate his own constitutional rights
may argue that an ordinance is “unconstitutionally vague or . . . impermissibly
restricts a protected activity.” Foti v. City of Menlo Park, 146 F.3d 629, 635 (9th Cir.
1998). Second, “an individual whose own speech or expressive conduct may validly
be prohibited or sanctioned is permitted to challenge a statute on its face because it
also threatens others not before the court.” Hunt v. City of Los Angeles, 638 F.3d

9

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 18 of 47

703, 710 (9th Cir. 2011). The first type of challenge “may be paired with the more
common as-applied challenge, where a plaintiff argues that the law is
unconstitutional as applied to his own speech or expressive conduct.” Santa Monica
Food Not Bombs v. City of Santa Monica, 450 F.3d 1022, 1033-34 (9th Cir. 2006)
(citations omitted); see also Foti, 146 F.3d at 635.
Wysingle satisfies standing because he has concrete plans to use a platform
the moratorium prohibits. The moratorium prevents Wysingle from soliciting for
bids. Supreme Court caselaw recognizes that the First Amendment’s protection is
afforded “to the communication, to its source and to its recipients both.” Virginia
State Bd. of Pharmacy v. Virginia Citizens Consumer Council, 425 U.S. 748, 756
(1976). As this Court held in Conant v. Walters, 309 F.3d 629, 643 (9th Cir. 2002),
“[t]he right to hear and the right to speak are flip sides of the same coin.” The
moratorium impacts both sides of the coin.
Wysingle plainly expressed his “goal is to use the bidding platform.” ER 58.
He had a concrete plan to advertise his property in the summer of 2018, as soon as
renovations were completed August 4, but the moratorium barred him from doing
so on Rentberry, as he’d wished. ER 57. Confirming his clear intent, Wysingle made
multiple visits to Rentberry’s website and telephone calls to Rentberry staff, all in
an effort to understand how to use the platform so that he could “give the bidding
process a try.” ER 59-62. He also described multiple features that he wished to use,
10

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 19 of 47

including the bidding feature. ER 61. Also, despite understanding that it would be
fruitless, Wysingle created a Rentberry account and tested whether he could post his
property; he was rebuffed, as expected, because of the moratorium. Supp. Wysingle
Decl. ¶ 7-9, Supp. App. 047-48. All told, Wysingle plainly demonstrated a concrete
intent to use Rentberry but for the challenged Ordinance.
The district court erroneously concluded that Mr. Wysingle lacked standing
because he “was not a member of Rentberry and his rental house was under
renovations.” ER 6.
Yet Rentberry is not a “membership” organization; it is an online service
provider. Even so, Wysingle did not need to create login credentials to establish
standing. Seattle explicitly prohibits both “landlords and potential tenants” from
“using rental housing bidding platforms for real property located in Seattle city
limits.” SMC § 7.24.090(A). Thus, it would be an act of futility for Wysingle to
“join” or establish login credentials for Rentberry if neither he nor prospective
tenants can legally use its services. Indeed, Wysingle has confirmed the futility of
“joining” Rentberry. Supp. Wysingle Decl. ¶ 7-8, Supp. App. 047-48.
Plaintiffs need not engage in futile action to establish standing to sue in federal
court. Taniguchi v. Schultz, 303 F.3d 950, 957 (9th Cir. 2002) (“[S]tanding does not
require exercises in futility.”). Thus, in Desert Outdoor Adver., Inc. v. City of
Moreno Valley, 103 F.3d 814, 818 (9th Cir. 1996), this Court ruled that billboard
11

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 20 of 47

operators had “standing to challenge [a] permit requirement, even though they did
not apply for permits, because applying for a permit would have been futile. . . .
because . . . the ordinance flatly prohibited [their] signs.”
Similarly, in Clark v. City of Lakewood, 259 F.3d 996, 1006 (9th Cir. 2001),
the owner of closed adult businesses established his standing by submitting a
declaration stating that “if the Ordinance is declared unconstitutional, ‘it is my intent
to reopen my business.’” Id. at 1008. This sufficed for standing purposes even
though Clark’s business license had expired; the Court saw no point in forcing him
to go through the futile process of applying for a new license. See id. The court below
disregarded Clark because the plaintiff in that case had an operating business before
the challenged law closed him down. ER 7. The situation in this case is different:
Rentberry represents a new technology—Wysingle could not have used Rentberry
prior to the moratorium. The City’s decision to restrain Rentberry’s platform for
speech prior to Wysingle being able to use it only enhances his injury. See Twitter,
Inc. v. Sessions, 263 F. Supp. 3d 803, 809 (N.D. Cal. 2017) (“Prior restraints on
speech are ‘the most serious and the least tolerable infringement on First
Amendment rights.’ Nebraska Press Ass’n, 427 U.S. at 559.”).
Additionally, in Food Not Bombs, 450 F.3d at 1034, and Arizona Right to Life
Political Action Committee v. Bayless, 320 F.3d 1002, 1006 (9th Cir. 2003), this
Court held that standing in First Amendment cases exists where a pre-enforcement
12

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 21 of 47

plaintiff shows that he altered his expressive activities to comply with the statute at
issue and alleges apprehension that the statute would be enforced against him. See
also Lopez, 630 F.3d at 790. Wysingle explicitly stated that he wanted to
communicate with potential tenants via Rentberry’s rent-bidding platform but,
reasonably fearing prosecution under the Ordinance, he advertised on Zillow
instead. 3 ER 42. It would “turn respect for the law on its head” to hold that a plaintiff
lacks standing because he “chose to comply with the statute and challenge its
constitutionality.” Bayless, 320 F.3d at 1007.
Further, the district court’s observation that Wysingle “could not say exactly
when his rental home would be available” mischaracterizes the evidence and cannot
justify depriving him of his day in federal court. See ER 6. To be sure, Wysingle
testified that he was unsure of an exact date because he was at the mercy of the
contractors. ER 56. But he accurately predicted that his property would be available
at the end of July 2018, and the property was indeed available within a week of his
estimate. See id.; ER 42. Wysingle’s current tenant’s lease expires prior to June 30,
2020, before the Ordinance once again comes up for renewal and Wysingle would

3

Zillow does not have a bidding feature. See Zillow, About Us,
https://www.zillow.com/corp/About.htm (visited July 16, 2019).
13

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 22 of 47

use Rentberry to solicit bids from prospective tenants, if permitted. Section
7.24.090(C). 4 Supp. App. 046.
Wysingle’s plans to rent out his home were not “some day intentions,” as the
district court called them. ER 7. Indeed, Wysingle had concrete plans that differ
markedly from the plaintiffs’ plans in Thomas v. Anchorage Equal Rights
Commission, 220 F.3d 1134 (9th Cir. 2000), the case cited by the district court. Id.
In Thomas, landlords challenged a law forbidding discrimination based on marital
status, but the landlords failed to “specify when, to whom, and under what
circumstances” they might engage in the unlawful conduct. Thomas, 220 F.3d at
1139. Thomas only held that standing “requires something more than a hypothetical
intent to violate the law.” Id. In contrast to the landlords in Thomas, Wysingle had a
concrete plan to rent out his home after renovations were complete, and he predicted
accurately that the renovations would be complete toward the end of July 2018. And
indeed the property renovations were completed on August 4, 2018. He still has a

4

The Ordinance was renewed on July 17, 2019, and Section 7.24.090 provides for
additional renewal if the City Council “needs more time” to review the study or
“discuss potential action.” Given the ability of a city council to discuss matters
endlessly, the “temporary” moratorium appears quite lengthy, if not permanent, to
city landlords and potential tenants. See, e.g., Bill Salter Advertising, Inc. v. City of
Brewton, Ala., 486 F. Supp. 2d 1314, 1328-29 (S.D. Ala. 2007) (striking down, on
First Amendment grounds, an “ongoing, indefinite moratorium” of “22 months and
counting” on billboard construction to allow city to study safety issues after a
hurricane because the moratorium extended far longer than necessary to complete
the study). Indeed, the Office of Housing has recommended that the moratorium be
made permanent. Supp. App. 024.
14

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 23 of 47

concrete plan to use Rentberry during June 2020, just before the current lease comes
to a close. Supp. App. 046. His behavior and plans demonstrate far more than
“hypothetical intent” or “some day intentions.” 5
II. The moratorium violates the First Amendment
Regulations that govern prices or commercial transactions do not restrict speech,
but regulations that restrict communication about price or a transaction must face
intermediate scrutiny. The moratorium restricts such communication because it
forbids parties from communicating bids or otherwise expressing themselves on
rental bidding platforms. The City must therefore satisfy First Amendment scrutiny.
a.

The moratorium restricts speech by banning online bids

The trial court erred in holding that the moratorium does not restrict speech.
This error stems from eliding a fundamental distinction between regulations that
govern transactions and regulations that restrict communication in anticipation of
transactions. The moratorium restricts communications about price and therefore
falls into the latter category.

5

Developments that have arisen after the district court’s decision have not rendered
the case moot. Although the original moratorium challenged by plaintiffs expired,
the almost identical moratorium now in place ensures a continuing controversy. See
Fireman’s Fund Ins. Co. v. City of Lodi, California, 302 F.3d 928, 936 n.8 (9th Cir.
2002) (where a city repeals a challenged ordinance and enacts a new, substantially
similar ordinance, the challenge is not moot because “the core disputes between the
parties remain”).
15

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 24 of 47

Communication about prices enjoys specific First Amendment protection. In
Virginia State Board of Pharmacy, for example, the Supreme Court invalidated a
state rule that forbade pharmacists from advertising prices. 425 U.S. at 773. The
Court held that a state cannot suppress price advertising because of the
“information’s effect upon its disseminators and its recipients.” Id. Likewise, in 44
Liquormart v. Rhode Island, the Supreme Court held that a state law preventing
liquor stores from posting prices was a speech restriction. 517 U.S. 484, 495 (1996).
And recently, in Expressions Hair Design v. Schneiderman, the Supreme Court held
that regulations impose a burden on protected speech when they restrict the method
that businesses use to communicate about their prices. 137 S. Ct. 1144, 1150-51
(2017). 6
Speech about pricing merits First Amendment protection because it offers
“vital information about the market.” 44 Liquormart, 517 U.S. at 495. Information
“as to who is producing and selling what product, for what reason, and at what price”
is “indispensable” to wise economic decisions. Virginia State Bd. of Pharmacy, 425

6

See also Nat’l Ass’n of Tobacco Outlets, Inc. v. Providence, R.I., 731 F.3d 71, 7677 (1st Cir. 2013) (“Pricing information concerning lawful transactions has been
held to be protected speech by the Supreme Court.”); Spirit Airlines, Inc. v. U.S.
Dep’t of Transp., 687 F.3d 403, 412 (D.C. Cir. 2012) (price advertising is
“quintessentially” commercial speech); Felix T. Wu, Commercial Speech Protection
as Consumer Protection, 90 U. Colo. L. Rev. 631, 644 (2019) (“Pricing information
is quintessential commercial speech, because pricing is a key component of any
commercial transaction.”).
16

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 25 of 47

U.S. at 765 (emphasis added). Hence, a consumer’s interest in robust commercial
speech “often may be far keener than his concern for urgent political debate.” Sorrell
v. IMS Health, Inc., 564 U.S. 552, 566 (2011) (quoting Bates v. State Bar of Ariz.,
433 U.S. 350, 364 (1977)).
Speech restrictions that stifle reciprocal communication between buyer and
seller pose an even greater threat than regulation of a one-way advertisement. See
Va. State Bd., 425 U.S. at 756 (“[W]here a speaker exists, . . . the protection afforded
is to the communication, to its source and to its recipients both.”). For example, in
Edenfield v. Fane, the Supreme Court addressed a ban on direct solicitation by
certified public accountants. 507 U.S. 761, 763-64 (1993). The Court noted the
“considerable value” of solicitation because it allowed “direct and spontaneous
communication between buyer and seller.” Id. at 766. Two-way communication
between parties is superior to a one-way advertisement because buyer and seller can
better negotiate, assess market demand, and reach a fully informed arrangement
based on mutual communication. See id.
Just like an advertisement or a listed price, soliciting, placing, and receiving a
bid are forms of protected speech. As the Supreme Court has repeatedly held,
communicating about price is protected by the First Amendment, and that protection
does not distinguish between a seller’s speech and a buyer’s speech. Posting a bid
for a rental unit is just as much an act of communication as quoting a price for a
17

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 26 of 47

prescription drug in Virginia State Board of Pharmacy or advertising the price of
alcohol in 44 Liquormart. Virginia State Bd. of Pharmacy, 425 U.S. at 757; 44
Liquormart, 517 U.S. at 489. Posting a bid is not a business transaction but instead
provides valuable information that facilitates an anticipated transaction. This is the
very definition of speech that “propose[s] a commercial transaction.” Va. State Bd.
of Pharmacy, 425 U.S. at 776. In fact, because bidding involves reciprocal
communication, it has stronger communicative content than a unilateral price in
advertising. Accordingly, several courts have subjected bidding restrictions to First
Amendment analysis. In Department of Professional Regulation, Board of
Accountancy v. Rampell, the Florida Supreme Court held that a law prohibiting
accountants from bidding for work “restricts economic expression constituting
commercial speech.” 621 So. 2d 426, 428 (Fla. 1993). A federal district court in
Florida drew a similar conclusion, holding that an auction is commercial speech
rather than conduct because “the activity of ‘auctioneering’ by its very nature does
nothing more than ‘propose a commercial transaction.’” See Jim Gall Auctioneers,
Inc. v. City of Coral Gables, Case No. 97-cv-3186-CIV-SEITZ, Order on CrossMotions for Summary Judgment at 12 (S.D. Fla. 1999) (quoting Va. State Bd. of
Pharmacy, 425 U.S. at 762).
The district court below erred in holding that the moratorium “regulates
conduct, not speech.” ER 10. Bidding is speech. When a law regulates “the
18

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 27 of 47

communication of prices rather than prices themselves,” that law regulates speech.
Expressions Hair Design, 137 S. Ct. at 1151. Broad authority to regulate commercial
transactions does not include within it the power to directly regulate speech related
to those transactions. As the Supreme Court put it in 44 Liquormart, “[I]t is no
answer that commercial speech concerns products and services that the government
may freely regulate. . . . [A] State’s regulation of the sale of goods differs in kind
from a State’s regulation of accurate information about those goods.” 44 Liquormart,
517 U.S. at 512. The district court failed to recognize that key difference.
The Supreme Court addressed the difference between regulating a transaction
and regulating speech about a transaction in Expressions Hair Design. The court of
appeals had held that a state law restricting credit-card surcharges was a price
regulation and therefore did not regulate speech. Expressions Hair, 137 S. Ct. at
1148. The Supreme Court disagreed, noting that the law “tells merchants nothing
about the amount they are allowed to collect . . . . What the law does regulate is how
sellers may communicate their prices.” Id. at 1151 (emphasis added). In the context
of bidding, a law that imposed a cap on the highest bid might be an example of a
price regulation with an incidental effect on speech. A ban on communicating a bid,
however, is a speech regulation, not a regulation of the potential transaction. See
Nordyke v. Santa Clara Cty., 110 F.3d 707, 710 (9th Cir. 1997) (law prohibiting

19

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 28 of 47

offers to sell firearms at gun shows was a restriction on commercial speech, since
the law regulated an offer—which is speech—rather than the sale itself).
On rental bidding platforms, a landlord posts a threshold price and renters post
competing bids. These bids, which are visible to both the advertising landlords and
other tenant-users, are designed to communicate valuable information for market
participants by helping them assess demand for a unit and settle on a reasonable
price. Market information like this is vital in our free enterprise system, and bidding
is an effective way to convey such information. See F.E.R.C. v. Electric Power
Supply Ass’n, 136 S. Ct. 760, 774, 776 (2016) (describing market mechanism in
auction context). Bidding online, just as in an auction, involves many people
expressing their preferences. That expression is protected speech.
Additionally, the moratorium restricts speech beyond just bidding. The law
imposes a blanket ban on the use of an entire online platform for residential housing,
not just the bidding component. This is clear from the definition of “Rental housing
bidding platform,” which “means a person that connects potential tenants and
landlords via an application based or online platform to facilitate rental housing
auctions wherein potential tenants submit competing bids on certain lease
provisions.” SMC § 7.24.020. Thus, the moratorium extends to the “online platform”
“wherein” bidding occurs, not just bidding alone. An “online platform” refers to an
entire software or website, not simply one function of the site.
20

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 29 of 47

The Ordinance does clarify that “[m]erely publishing a rental housing
advertisement does not make a person a rental housing bidding platform.” Id. This
exception, however, does not reach advertisements published on an online platform
that otherwise qualifies as a rental housing bidding platform.
The moratorium thus covers an array of speech on these platforms beyond
bidding, such as advertising a unit through images and descriptions, use of search
engine functions for prospective tenants, communicating about maintenance
requests, providing references, and so forth. Moreover, landlords cannot post an
advertisement on Rentberry without using the bidding component. ER 45. Thus,
even if listing and bidding on a price did not constitute protected expression, the
moratorium nonetheless forbids other forms of speech.
The district court, however, only addressed bidding in its holding that the
moratorium only regulated conduct. The cases relied upon by the district court
merely underscore the essential difference between a law that regulates
communication in anticipation of a transaction and regulation of the transaction
itself. For example, the district court looked to Airbnb, Inc. v. City and County of
San Francisco, 217 F. Supp. 3d 1066 (N.D. Cal. 2016), where a federal district court
upheld a regulation that prohibited businesses from booking unregistered short-term
rentals. But the parties agreed in that case that the challenged regulation “[was] not,
on its face, directed to content or speech.” 217 F. Supp. 3d at 1073. The plaintiffs
21

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 30 of 47

had instead argued that preventing businesses from booking unregistered rentals had
an incidental impact on speech because it discouraged people from advertising
unregistered units on sites that couldn’t legally complete the booking. Id. at 107677. Hence, the district court held that the ordinance was “directed at commerce or
conduct,” not expression. Id. at 1078.
Likewise, the district court cited a similar short-term rental case,
Homeway.com, Inc. v. City of Santa Monica, 918 F.3d 676 (9th Cir. 2019). 7 As with
the Airbnb case, the ordinance at issue prevented hosting platforms from completing
a booking transaction for unlicensed properties and forbade collecting a fee for
facilitating unlicensed home-sharing. Id. at 680. As with Airbnb, the court held that
this ordinance regulated conduct in the form of booking transactions, not speech in
anticipation of a transaction. Id. at 685. In contrast to Airbnb and Homeaway, the
moratorium here does not restrict completion of a business transaction like booking
a rental or executing a lease—it instead restricts bidding if it occurs on an online
platform, which is a recognized form of expression.
The district court also cited a case involving a challenge to a minimum-wage
law, International Franchise Association, Inc. v. City of Seattle, 803 F.3d 389, 408
(9th Cir. 2015), a case once again addressing the conduct-speech distinction. There,

7

The district court cited to the district court decision, 2018 WL 1281772, but this
Court has since issued a decision on appeal affirming the district court.
22

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 31 of 47

Seattle’s minimum-wage ordinance differentiated between large and small
employers in its incremental compliance schedule, with large employers facing a
stricter schedule. Id. at 397-98. Franchisees with large networks were considered
“large employers” for this purpose. Id. The plaintiffs claimed that the definition of a
“franchise” subject to the stricter schedule violated the First Amendment because
part of the definition included expressive activity, namely that the “operation of the
business is substantially associated with a trademark, service mark, trade name,
advertising, or other commercial symbol.” Id. at 408. While noting that the ordinance
was “not wholly unrelated to a communicative component,” this Court held that the
ordinance did not directly regulate the speech component because it “applies to
businesses that have adopted a particular business model, not to any message the
businesses express.” Id. at 408-09. Again, the moratorium is notably different. It
does not regulate the business transaction of executing a lease agreement—it instead
only regulates speech between buyers and sellers in anticipation of a commercial
transaction. The moratorium must therefore face at least intermediate scrutiny under
the commercial speech doctrine.
b.

The moratorium should face strict scrutiny because the
moratorium restricts both commercial and non-commercial speech

Strict scrutiny is the proper standard for assessing the moratorium because the
law is a content-based restriction on a mixture of commercial and non-commercial

23

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 32 of 47

speech. 8 See Reed v. Town of Gilbert, Ariz., 135 S. Ct. 2218, 2228 (2015) (“A law
that is content based on its face is subject to strict scrutiny.”). Intermediate scrutiny
applies when speech “does no more than propose a commercial transaction.” Va.
State Bd. of Pharmacy, 425 U.S. at 776. However, strict scrutiny will apply if the
commercial speech is “inextricably intertwined with otherwise fully protected
speech.” Riley v. Nat’l Fed’n of the Blind, 487 U.S. 781, 795-96 (1988).
Rentberry facilitates a panoply of communications between landlords and
tenants. These include not just advertisements, but also direct communication about
rentals, maintenance service requests, housing references, and the like. See ER 46.
Even the algorithms that Rentberry uses to communicate information to users—such
as housing and pricing recommendations—enjoy full First Amendment protection.
See Universal Studios v. Corley, 273 F.3d 429, 445-48 (2d Cir. 2001) (computer
code is protected speech). Additionally, Rentberry compiles and disseminates
information through its search engine, a form of protected, noncommercial speech.
ER 46; see also Sorrell, 564 U.S. at 570 (“The creation and dissemination of

8

Plaintiffs maintain that, under Sorrell v. IMS Health, 564 U.S. 552 (2011), strict
scrutiny is appropriate also because the moratorium “imposes a burden based on the
content of speech and the identity of the speaker.” Sorrell, 564 U.S. at 567.
Nonetheless, this argument is currently foreclosed in this Court’s precedent. In
Retail Digital Network v. Prieto, over Chief Judge Thomas’s dissent, this Court held
that content-based restrictions on commercial speech need only satisfy intermediate
scrutiny. Retail Digital Network, 861 F.3d 839, 846 (9th Cir. 2017); id. at 851
(Thomas, C.J., dissenting). Wysingle and Rentberry therefore preserve their
argument over the proper reading of Sorrell for later proceedings.
24

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 33 of 47

information are speech within the meaning of the First Amendment.”); Langdon v.
Google, 474 F. Supp. 2d 622, 629-30 (D. Del. 2007) (search engine results are
compilations of information enjoying First Amendment protection); Publius v.
Boyer-Vine, 237 F. Supp. 3d 997, 1008 (E.D. Cal. 2017) (“As the owner of
Northeastshooters.com, Hoskins has a First Amendment right to distribute and
facilitate protected speech on the site.”). Wysingle wishes to engage in this array of
speech facilitated by Rentberry and prohibited by the moratorium. Thus, strict
scrutiny should apply.
c.

The moratorium cannot satisfy intermediate scrutiny

In any case, the moratorium cannot even survive the more forgiving test for
commercial speech restrictions. The City proffers three abstract rationales for the
moratorium, all based on giving the City time (1) to study whether rental bidding
platforms comply with local law; (2) to study the impact of rental bidding platforms
on the Seattle housing market; and (3) to give the City time to create a regulatory
framework if necessary before the use of these platforms proliferate. In essence, the
City’s approach is to ban first and gather evidence later. The First Amendment does
not allow that kind of preemptive strike against speech.
Courts employ the four-part Central Hudson test when analyzing commercial
speech restrictions. See Central Hudson Gas & Electric Corporation v. Public
Service Commission of New York, 447 U.S. 557, 566 (1980). The test asks (1)
25

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 34 of 47

whether the speech is related to lawful activity and is not deceptive; (2) whether the
government interest at stake is substantial; (3) whether the speech restriction
“directly and materially” serves that interest; and (4) whether the restriction is “no
more extensive than necessary.” Id.
i.

The moratorium does not target misleading speech or speech
related to unlawful activity

The first inquiry is a threshold question to determine whether the restricted
speech merits First Amendment protection. World Wide Rush, LLC v. City of Los
Angeles, 606 F.3d 676, 684 (9th Cir. 2010). If the restricted speech is non-deceptive
and does not propose an unlawful transaction, then the government bears the burden
of satisfying the other three steps. Valle Del Sol, Inc. v. Whiting, 709 F.3d 808, 816
(9th Cir. 2013).
Rental bidding is not deceptive and does not propose an unlawful transaction,
and the City did not argue otherwise below. ER 65. The Ordinance did raise a
concern that rental bidding might not comply with local laws, but the City Council
has made no finding to that effect. Instead, the City has insisted in the original
moratorium and the renewed one that “it is unclear whether the structure and
operation of these new services comply with the City’s code.” ER 36; Supp. App.
004. Indeed, a driving purpose behind the Ordinance is to study whether the speech
at issue is lawful. Yet the report issued in July does not draw any clear conclusion
as to whether the platforms violate the code either. See Supp. App. 013-024. These
26

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 35 of 47

speculative and inconclusive worries cannot strip the targeted speech of First
Amendment protection.
The only specific law cited by the Ordinance as possibly in tension with rental
bidding is the first-in-time rule, codified at Section 14.08 of the Seattle Municipal
Code. First-in-time requires landlords to rent to the first qualified applicant. That
rule, however, was struck down as unconstitutional by the King County Superior
Court in 2018, which held the first-in-time rule was an uncompensated taking for
private use and that it violated landlords’ due-process and free-speech rights. See ER
23-32. The Supreme Court of Washington accepted review of that decision and
heard oral argument in June 2019. Unless the Supreme Court reverses, the first-intime rule is not in effect and cannot support the moratorium. Even if it were in effect,
the City has made no conclusion as to whether first-in-time, or any other law for that
matter, forbids bidding—the City’s study instead seeks to flip the burden of proof
by recommending that the moratorium remain in effect until Rentberry proves that
its services comply with the law.
ii.

Suspending speech as a preemptive strike while the City
investigates whether the speech is harmful does not directly
advance the government’s interests

Commercial speech restrictions must “directly advance” the government’s
substantial interest. Central Hudson, 447 U.S. at 564. There are two primary reasons
the City cannot satisfy this step: (1) the City has no conclusive evidence that rental
27

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 36 of 47

bidding platforms are harmful or unlawful; and (2) the moratorium does not advance
the City’s interest in studying rental bidding platforms.
1.

The City banned speech about pricing without evidence of
harm

A speech restriction does not directly advance the government’s interests if it
swipes at speculative harms. 9 “The First Amendment requires a more careful
assessment and characterization of an evil” before imposing a speech restriction.
U.S. v. Playboy Entertainment Grp., Inc., 529 U.S. 803, 819 (2000). When
government restricts speech to “prevent anticipated harms, it must do more than
simply ‘posit the existence of the disease to be cured.’” Turner Broadcasting System,
Inc. v. FCC, 512 U.S. 622, 664 (1994) (quoting Quincy Cable TV, Inc. v. FCC, 768
F.2d 1434, 1455 (D.C. Cir. 1985)). Even under intermediate scrutiny, the City’s fear
must find substance in evidence that “the harms it recites are real” rather than “mere
speculation and conjecture.” Lorillard Tobacco Co. v. Reilly, 533 U.S. 525, 555
(2001) (quoting Greater New Orleans Broadcasting Ass’n, 527 U.S. at 188). This
demand for concrete evidence is not satisfied by “anecdotal evidence and educated
guesses.” Rubin v. Coors Brewing Co., 514 U.S. 476, 490 (1995).

9

The Supreme Court considers the speculative nature of an alleged harm under the
direct-advancement step of Central Hudson. See, e.g., Greater New Orleans
Broadcasting Ass’n, Inc. v. United States, 527 U.S. 173, 188 (1999).
28

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 37 of 47

Just as courts demand concrete evidence of harm, they also view prophylactic
speech restrictions with extreme skepticism. The Supreme Court has consistently
frowned upon “preventative rules in the First Amendment context.” Edenfield, 507
U.S at 777. In Edenfield, Florida tried to defend its solicitation ban as a prophylactic
rule that helped diminish risk of fraud. Id. at 768. The Court rejected this approach:
“Broad prophylactic rules in the area of free expression are suspect. Precision of
regulation must be the touchstone in an area so closely touching our most precious
freedoms.” Id. at 777 (quoting NAACP v. Button, 371 U.S. 415, 438 (1963)).
Here, the City candidly admitted in the text of both the initial and the new
moratorium that it did not know whether bidding would violate housing regulations
or inflate housing costs. The City stated that “it is unclear” whether the rental bidding
websites violate local ordinances and likewise “uncertain whether and how these
services impact Seattle’s rental housing market.” ER 36; Supp. App. 004. And it
remains unclear more than a year later, despite the City’s study of the issue. It is far
from obvious that bidding would inflate prices in Seattle’s housing market, given
that bidders can bid below a landlord’s asking price, and sellers at auction
customarily set the asking price below the expected sale price. See Coalition for
Icann Transparency Inc. v. Verisign, Inc., 464 F. Supp. 2d 948, 964 (N.D. Cal. 2006)
(rejecting notion that an auction system would have “predictable adverse price
effects”).
29

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 38 of 47

The City’s supposed interest in discovering whether a more lasting restriction
is necessary is akin to California’s speech restriction on the Internet Movie Database,
where California candidly admitted that it did not yet have evidence of the harm it
feared. IMDb.com, Inc. v. Becerra, 257 F. Supp. 3d 1099 (N.D. Cal. 2017). The
district court responded: “Restrict speech first and ask questions later, the
government seems to say. This ignores the First Amendment’s heavy presumptions
against restricting speech of this kind.” Id. at 1102 (emphasis in original). So it is
with the City here—it imposed a speech burden before discovering the information
that it admits it needs to justify regulating rental bidding platforms.
In fact, even after completing its study, the City has come up short of
evidence. The Office of Housing’s report contains nothing more than further
speculation and conjecture. The report declines to draw any conclusions about the
legality or impact of rental bidding platforms. The report concedes: “[A]ny effect
that rental bidding platforms have on weak or strong housing markets is difficult to
disaggregate and attribute directly to rental bidding platforms.” Supp. App. 0015.
The report’s speculation does not provide the evidence necessary to justify the
moratorium. For instance, the report’s section on fair housing compliance says that
Rentberry “mimics” other services that have been “criticized for allowing racial
discrimination,” Supp. App. 016, but this conclusory and vague statement offers
nothing more than conjecture. Likewise, the report raises a concern about “subsidy
30

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 39 of 47

discrimination” if auctioning raises rents, but it only speculates that bidding “may
be incompatible” with subsidy programs if it increases prices or “a rent auction could
cause a landlord to judge higher rent offers with more weight than other criteria,”
but the report offers no evidence on either point. Supp. App. 018.
With regard to impact on housing costs, the report notes “the lack of
information on the technology” and concludes that a study with a “rigorous
methodology” is needed “to draw significant and sound conclusions.” Supp. App.
019. The only “evidence” offered with regard to impact on housing costs is a single
anecdote from Melbourne, Australia. Supp. App. 020. But the report only notes that
rental bidding faced substantial criticism in Melbourne without citing any evidence
of the platforms’ actual impact. Id. This is just one more layer of speculation and
conjecture, which the report seems to recognize by refraining from drawing any
conclusions about the impact of the technology.
The City had the opportunity to produce all necessary facts at the summary
judgment stage, and it did not do so. The City also had a year to produce its study,
and it failed to do so. Only after this case was appealed did the City finally release a
study, yet that study still relies on speculation and guesswork. The City’s routine
failure to present even post-hoc evidence that the moratorium is justified cannot
possibly qualify as the substantial evidence required to satisfy First Amendment
scrutiny. See United States v. Virginia, 518 U.S. 515, 533 (1996) (“The justification
31

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 40 of 47

must be genuine, not hypothesized or invented post hoc in response to litigation.
And it must not rely on overbroad generalizations . . . .”).
The City’s study pales when compared to the kind of evidence considered
sufficient in other commercial speech cases. In Florida Bar v. Went for It, Inc., 515
U.S. 618 (1995), the Supreme Court upheld a rule barring personal injury attorneys
from using direct mail solicitation after the Florida Bar presented a 106-page
summary of a two-year study of lawyer advertising, which included statistical and
anecdotal evidence “noteworthy for its breadth and detail.” Id. at 626-27. And in
Turner Broadcasting, the Supreme Court upheld television must-carry rules because
Congress had passed the law “[a]fter hearing years of testimony, and reviewing
volumes of documentary evidence and studies offered by both sides.” Turner
Broadcasting, Inc. v. FCC, 520 U.S. 180, 199 (1997).
The care and thoroughness in these cases are a stark contrast to the meager
eleven-and-a-half pages offered by the City’s year-long study, which contains little
more than a single anecdote, with no statistical evidence, and no even-handed review
of the evidence on all sides.
2.

The moratorium does not facilitate the government studies
mandated by the ordinance

A commercial speech restriction must have a “logical connection” between
means and end. Metro Lights, LLC v. City of Los Angeles, 551 F.3d 898, 905 (9th
Cir. 2009). The moratorium lacks that connection. Its primary purpose was to study
32

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 41 of 47

the effects and legality of rental bidding platforms. Banning the use of the platforms
runs counter to that purpose. As the Office of Housing report recognized, “More
information about rental bidding platforms and their effect on the local housing
market, landlords, and tenants will not be available unless rental bidding platforms
are reinstated.” Supp. App. 019.
Moreover, now that the commissioned study is complete, the City’s core
purpose behind the moratorium no longer exists. Its only remaining interest is a
vague rationale mentioned in a city staff memo, namely “to give the City time to
create a regulatory framework if necessary before use of such services proliferates.”
ER 34. This is nothing more than a conclusory, speculative, and circular suggestion
that if the City does not regulate rental bidding before it grows, then the
consequences could be “significant.” ER 65-66. What these “significant”
consequences are, the City does not and cannot say (hence the call for a study), and
presuming harm to justify a regulatory framework is the kind of circular reasoning
that cannot satisfy First Amendment scrutiny.
The City’s worry that these platforms will “proliferate” is also overtly
speculative—the City does not know whether rental bidding will catch on or whether
its proliferation will make a regulatory structure more difficult to impose. Even if
the moratorium does make it easier to impose future regulation, “the First
Amendment does not permit the State to sacrifice speech for efficiency.” Riley v.
33

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 42 of 47

Nat’l Fed’n of Blind of N.C., Inc., 487 U.S. at 795. The City’s reflexive approach to
regulation clashes with the fundamental notion “that regulating speech must be a
last—not first—resort. Yet here it seems to have been the first strategy the
Government thought to try.” Thompson v. Western States Medical Center, 535 U.S.
357, 373 (2002).
3.

The moratorium is underinclusive

A speech regulation also runs afoul of Central Hudson’s advancement step if
it is underinclusive. Valle Del Sol, 709 F.3d at 824. An underinclusive reach “raises
serious doubts about whether the government is in fact pursuing the interest it
invokes, rather than disfavoring a particular speaker or viewpoint.” Brown v.
Entertainment Merchants Ass’n, 564 U.S. 786, 802 (2011).
This problem arises when a regulation reaches only a subset of the speech that
causes the alleged harm, such that the regulation fails to achieve its purported goal
or makes irrational distinctions between regulated and unregulated speech. See
Williams-Yulee v. Florida Bar, 135 S. Ct. 1656, 1670 (2015) (A law is
underinclusive if it “regulates one aspect of a problem while declining to regulate a
different aspect of the problem that affects its stated interest in a comparable way.”).
For example, in Rubin, a law prohibiting alcohol content on beer labels to discourage
strength wars was underinclusive because it did not prevent ads from displaying
alcohol content, did not apply to distilled spirits, and did not bar descriptive terms to
34

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 43 of 47

boast about alcohol strength. Rubin, 514 U.S. at 488-89. The resulting patchwork
scheme “makes no rational sense if the Government’s true aim is to suppress strength
wars.” Id. at 488.
The moratorium has a similar flaw: it targets only specific bidding forums. It
does not, for example, prohibit a landlord from posting an ad on Craigslist soliciting
bids. Nor would it prevent prospective tenants from offering a higher rent to gain a
competitive edge. These other bidding activities pose the same alleged concern of
impacting housing costs, yet they lack the benefits of transparency offered by
bidding sites like Rentberry. As in Rubin, the moratorium targets only one forum in
which the speech at issue occurs. This myopic focus “makes no rational sense if the
Government’s true aim” is to address rental bidding. Rubin, 514 U.S. at 488.
iii. The moratorium is more extensive than necessary
A commercial speech restriction must be “narrowly tailored to achieve the
desired objective.” Lorillard Tobacco, 533 U.S. at 556. While the commercial
speech test does not require the government to adopt the least restrictive means to
accomplish its interest, the availability of less restrictive alternatives suggests that a
law is more extensive than necessary. See Rubin, 514 U.S. at 491 (“We agree that
the availability of these options, all of which could advance the Government’s
asserted interest in a manner less intrusive to respondent’s First Amendment rights,
indicates that § 205(e)(2) is more extensive than necessary.”). To satisfy this prong
35

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 44 of 47

of Central Hudson, the government carries the burden of demonstrating that lessrestrictive alternatives would be insufficient to fulfil the government’s purpose. See
Thompson, 535 U.S. at 373 (“The Government has not offered any reason why these
possibilities, alone or in combination, would be insufficient to prevent compounding
from occurring on such a scale as to undermine the new drug approval process.
Indeed, there is no hint that the Government even considered these or any other
alternatives.”). For example, in 44 Liquormart, Inc., the state banned advertising
liquor prices in order to encourage temperance. 517 U.S. at 505. Rhode Island argued
that a price advertising ban promoted this goal because the ban would mitigate
competition and thereby maintain high prices. Id. at 506-7. The Supreme Court,
however, held that the ban was more extensive than necessary because less
restrictive means to inflate alcohol prices existed—namely increased taxes on
alcohol. Id. at 507.
Like in 44 Liquormart, Seattle wants to influence the cost of a product
(housing), but the City hopes to reduce rather than inflate that cost. As the Supreme
Court noted in 44 Liquormart, there are many ways to control price for a product
that do not involve restricting speech. For example, Seattle could influence housing
prices by offering subsidies or other incentives to developers to increase supply or
by subsidizing renters below a certain income level. Seattle is already engaged in
non-speech-restrictive efforts to lower the cost of housing, such as the Multifamily
36

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 45 of 47

Tax Exemption that creates incentives to provide low-income housing. See SMC §
5.73. Such alternatives do not restrict speech and offer a more direct route to
addressing housing costs. The City carries the burden to demonstrate that such
alternatives are insufficient. Yet “there is no hint that the government even
considered these or other alternatives.” Thompson, 535 U.S. at 373. Hence, the
moratorium is more extensive than necessary.
CONCLUSION
The moratorium strangles speech in the cradle without any evidence of harm
or any attempt to balance the speech interests at stake with the City’s interests. The
ban therefore fails both strict and intermediate scrutiny. The trial court should be
reversed.
DATE: August 16, 2019.

Respectfully submitted,

s/ ETHAN W. BLEVINS
Ethan W. Blevins
Brian T. Hodges
Pacific Legal Foundation
255 South King Street, Suite 800
Seattle, Washington 98104
Telephone: (425) 576-0484
E-mail: EBlevins@pacificlegal.org
E-mail: BHodges@pacificlegal.org

Wencong Fa
James M. Manley
Pacific Legal Foundation
930 G Street
Sacramento, California 95814
Telephone: (916) 419-7111
Fax: (916) 419-7747
E-mail: WFa@pacificlegal.org
E-mail: JManley@pacificlegal.org

Attorneys for Plaintiffs – Appellants

37

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 46 of 47

CERTIFICATE OF SERVICE
I hereby certify that on August 16, 2019, I electronically filed the foregoing
with the Clerk of the Court for the United States Court of Appeals for the Ninth
Circuit by using the appellate CM/ECF system.
I certify that all participants in the case are registered CM/ECF users and
that service will be accomplished by the appellate CM/ECF system.

s/ ETHAN W. BLEVINS
Ethan W. Blevins
STATEMENT OF RELATED CASES
Plaintiffs-Appellants are not aware of any related cases within the meaning
of Circuit Rule 28-2.6.
s/ ETHAN W. BLEVINS
Ethan W. Blevins

38

 Case: 19-35308, 08/16/2019, ID: 11400160, DktEntry: 8, Page 47 of 47

Certificate of Compliance for Briefs
9th Cir. Case Number: 19-35308
I am the attorney or self-represented party.
This brief contains 8,887 words, excluding the items exempted by Fed. R. App.
P. 32(f). The brief’s type size and typeface comply with Fed. R. App. P. 32(a)(5)
and (6).
I certify that this brief (select only one):
[x] complies with the word limit of Cir. R. 32-1.
[ ] is a cross-appeal brief and complies with the word limit of Cir. R. 28.1-1.
[ ] is an amicus brief and complies with the word limit of Fed. R. App. P.
29(a)(5), Cir. R. 29-2(c)(2), or Cir. R. 29-2(c)(3).
[ ] is for a death penalty case and complies with the word limit of Cir. R.
32-4.
[ ] complies with the longer length limit permitted by Cir. R. 32-2(b)
because (select only one):
[ ] it is a joint brief submitted by separately represented parties;
[ ] a party or parties are filing a single brief in response to multiple briefs; or
[ ] a party or parties are filing a single brief in response to a longer joint
brief.
[ ] complies with the length limit designated by court order dated _______.
[ ] is accompanied by a motion to file a longer brief pursuant to Cir. R. 322(a).
DATE: August 16, 2019.

s/ ETHAN W. BLEVINS
Ethan W. Blevins
Attorney for Plaintiffs – Appellants

39