Peloton Interactive Inc.’s attempt to fire back at music publishers who sued the exercise bike maker for copyright infringement was quashed by a federal judge.
U.S. District Judge Denise Cote on Wednesday dismissed Peloton’s countersuit, which alleged that a trade group had sabotaged its negotiations for the rights to music for its workout videos.
More than a dozen music publishers sued Peloton last March after it incorporated music into its videos through a subscription service, claiming it hadn’t obtained the appropriate licenses. In April, Peloton filed counterclaims that the group of publishers had demanded “supracompetitive” licensing prices and then sabotaged negotiations with its individual publishers and orchestrated the lawsuit in violation of antitrust law.
Cote dismissed the counterclaims, saying that while Peloton had adequately alleged that the association and the publishers conspired to deny licenses to it, it didn’t explain why it can’t substitute songs owned by others, since it admitted it had reached agreements with all the major publishers and many independent ones.
“It is true that every copyrighted work has at least some modicum of originality,” she wrote in her ruling. “But recognition of that fundamental tenet of copyright law does not explain why songs not controlled by the music publishers cannot substitute in exercise programming for songs they do control.”
Peloton’s bikes and treadmills come with screens that let users watch classes and select music. The company relies heavily on its patents, trademarks and copyrighted material to charge a premium and separate itself from competitors.
“We respectfully disagree with this ruling regarding our counterclaims and are assessing our options for appeal,” Peloton said. “We will continue to vigorously contest the plaintiff publishers’ infringement claims, which were not addressed in this decision.”
The case is Downtown Music Publishing LLC v. Peloton Interactive Inc., 19-cv-2426, U.S. District Court, Southern District of New York (Manhattan).
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