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Flywheel admits its streaming bikes copied Peloton’s technology

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In a settlement, Flywheel will pull its leaderboard functionalities

Peloton and Flywheel have agreed to settle their legal disputes over claims that Flywheel copied Peloton’s patented technology, according to a Texas court filing dated February 3rd.

The case launched back in September 2018 when Peloton argued that Flywheel’s version of the at-home stationary bike that streams on-demand classes infringes on its patented technology, down to the way workout metrics are displayed and can be used to compete against other live riders in the class. (This format is known as a leaderboard on Peloton’s version.)

In the case, Peloton also claimed a Flywheel investor had misrepresented himself to Peloton CEO John Foley at a private conference by posing as a potential investor who was curious about the company’s business plans. Three months after that meeting, Flywheel launched its Fly Anywhere bike. At the time, Flywheel denied the accusation, claiming it had been working on a leaderboard-style competitive class structure years before Peloton’s signature exercise bike launched.

In this week’s settlement, however, Flywheel now admits its bike did indeed infringe on Peloton’s intellectual property, and it will stop using the leaderboard system in the next 60 days. In exchange, Peloton will drop its case, though financial terms of the settlement were not disclosed.

The win for Peloton comes just before the company is expected to share its second earnings report since going public last year. Shares temporarily rose to a 30-day high after news of the settlement broke.