Peloton must face lawsuit claiming it misled over "ever-growing" classes, judge rules
Peloton must face a proposed class-action lawsuit filed on behalf of customers who were angered by the company's decision to cut its number of exercise classes while continuing to market its service as offering an "ever-growing" library of classes.
The lawsuit stems from another legal tussle for Peloton, when it was sued in 2019 by the National Music Publishers Association over its alleged failure to license music played during its exercise classes. It allegedly used songs by musicians including Rihanna and Lady Gaga without paying for the rights.
That music lawsuit was eventually settled, but Peloton in the meantime removed all classes that included the copyright-infringing songs, which represented about half of its library. That angered some customers who had bought their Pelotons on the company's marketing claims that its offering of classes was "ever-growing."
U.S. District Judge Lewis Liman wrote in his 40-page decision that Peloton's marketing language "indicated to the market that there would be value associated with the products that resulted in an increased price when that value was not actually there."
Peloton declined to comment, noting in an email to CBS MoneyWatch that it "cannot comment on active litigation."
Peloton has struggled with demand as pandemic measures have waned and people feel more comfortable going back to the gym and exercising indoors with others. The company's co-founder and former CEO John Foley stepped down in February, while the company announced it was axing 2,800 workers across its global operations.