Peloton told it can't countersue music publishers over high workout music prices
The lawsuit was filed after music publishers sued the company for using unlicensed songs.
Peloton has failed to convince the court that the National Music Publishers Association violated federal antitrust laws. If you'll recall, the NMPA sued Peloton in early 2019, accusing it of using songs in its workout videos without obtaining the proper licenses for them. Peloton's workout subscription members, who pay $468 a year, had to deal with a limited selection and "terrible tunes" as a result.
The company then fired back with a countersuit, which accused the NMPA of seeking supracompetitive licensing prices -- in other words, prices much higher than usual -- that violate antitrust laws, as well as of sabotaging its negotiations with individual publishers. US District judge Denise Cote has just dismissed the case.
Cote explained that Peloton "plausibly alleged" that the NMPA and its publishers conspired to deny the company the right to use their songs. However, the company failed to sub in songs owned by others, especially since it previously said that it had reached agreements with all major publishers and with many independent outfits. The judge wrote in her ruling: "It is true that every copyrighted work has at least some modicum of originality. 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."
A Peloton spokesperson said the company "respectfully disagree[s] with this ruling regarding [its] counterclaims and [is] assessing [its] options for appeal." He added "We will continue to vigorously contest the plaintiff publishers' infringement claims, which were not addressed in this decision."
Meanwhile, NMPA president David Israelite told The Hollywood Reporter in a statement:
"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. 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."
