A US district judge has squashed Peloton’s counter lawsuit today, against music publishers who claimed the fitness company violated rights to use select artists’ music in its workout videos. Peloton hosts live cycling and running classes that are performed to a curated playlist, but the National Music Publishers’ Association claimed that because Peloton classes can be streamed on bikes, treadmills, or mobile apps, it did not have sufficient licensing to broadcast the music over the air.
In a lawsuit filed last March, the NMPA’s complaint alleged Peloton needed the more expansive (and expensive) “sync license,” which allows music to be played to match its visual media output. Peloton classes are often conducted to the progression of each songs, such as standing up off the bike during the chorus, slowing down during an instrumental break, or turning up a treadmill speed each time a word is mentioned in the song lyrics, so songs can’t simply be replaced by other music playlists when streamed on-demand. The lawsuit originally sought damage charges of $150 million, but doubled to $300 million in September after the NMPA discovered more improperly licensed music.
As a result, Peloton customers have seen many classes removed from their library, and claim that the quality of music has deteriorated since the lawsuit.
In a countersuit, Peloton argued the NMPA’s lawsuit was itself violating federal antitrust laws by conspiring to “fix prices and to engage in a concerted refusal to deal with Peloton.” But while Peloton laid out the case at length, the company wasn’t able to convince US district judge Denise Cote, who dismissed the case yesterday.
In her decision, Cote says Peloton was unable to explain why it couldn’t substitute songs it did reach sync license agreements with. “It is true that every copyrighted work has at least some modicum of originality,” Cote says in the 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.”
The NMPA still hasn’t proven Peloton needs the more expensive licenses, and this ruling won’t necessarily have any bearing on the other case — but it’s a bad sign for Peloton’s ability to license music in the meantime. The lawsuits have already caused some music and classes to disappear from Peloton’s roster, although the company has continued marketing other themed classes that promote new music, including an Artist Series featuring Billie Eilish, Lizzo, and Lady Gaga.
“Today’s victory is a reminder that tech companies like Peloton cannot build businesses that are reliant on songwriters without asking their permission and paying them. Judge Cote has dismissed all of Peloton’s counterclaims which were only meant to distract from their failure to license 2,468 songs,” NMPA president David Israelite says in a statement. “We are pleased that Peloton’s attempts to divert attention from the heart of the issue — properly paying creators for the music on which its billion-dollar business was built — have been defeated.”
Peloton says it plans to continue challenging this decision. “We respectfully disagree with this ruling regarding our counterclaims and are assessing our options for appeal. We will continue to vigorously contest the plaintiff publishers’ infringement claims, which were not addressed in this decision,” a Peloton spokesperson tells The Verge in a statement.
You can read the full opinion below.