MonkeyParking, the Italian startup that allows iPhone users to auction off public parking spaces via its smartphone app, announced that it is temporarily suspending operations in San Francisco.

The move comes just one day before the San Francisco City Attorney’s Office said it would sue the firm if it did not stop its activities in the city. Last month, the city sent the firm a cease-and-desist letter informing the company that what it was doing violated local law.

The company insisted that what it was doing was legal and that it would not shut down. But in a statement Thursday, MonkeyParking said it was altering course.

“We are currently reviewing our service to clarify our value proposition and avoid any future misunderstandings,” the MonkeyParking statement said. “Street parking is currently not a first-come-first-served process, but still a random-served one: you can go in circles for hours while a lucky driver can find a spot in a minute, right in front of you. It is an old and painful problem and we believe that drivers deserve a better solution.”

MonkeyParking, which also operates for motorists in Rome, claimed last month that it was not auctioning off public parking spaces. Rather, the company said it was auctioning information about the parking spaces.

“The real issue here is that a local ordinance is being misapplied to wrongfully target our service,” the company previously said. “This is happening with our company and other companies operating in the social sharing space. This is yet another example of a local ordinance that was drafted in a world pre-shared economy which local authorities are improperly applying to a shared economy service.”

Paolo Dobrowolny, the company’s chief executive, did not immediately respond to a request for comment.