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Peloton settles with indie music publishers ending copyright litigation
By Chris Cooke | Published on Friday 28 February 2020
Fitness firm Peloton has reached a deal with the American music publishers that sued the company last year over the unlicensed use of music in its videos.
Peloton makes fitness machines that come with screens via which users can access workout videos. In the lawsuit filed by more than a dozen music publishers, it was alleged that some of those videos contained unlicensed music controlled by the plaintiffs.
Following the music publisher lawsuit, Peloton then countersued mainly on competition law grounds. It alleged that it had previously had good relationships with most of the publishers involved in the legal dispute and was negotiating licensing deals with many of them.
Those relationships only fell apart, it then claimed, because of interference by America’s National Music Publishers Association. The NMPA hit back, arguing that Peloton knew that it had no grounds to defend the copyright infringement claims, so was desperately trying to conjure up a bogus competition law complaint instead.
Last month a judge dismissed the competition lawsuit, mainly on the basis that – while fourteen publishers may have been involved in the Peloton litigation – in the wider scheme of things those companies only controlled a relatively small songs catalogue. The fitness firm, therefore, had plenty more songs to choose from, so the plaintiffs allying around their litigation didn’t create any competition law concerns.
At the time, NMPA boss David Israelite declared: “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”.
Meanwhile, Peloton itself said that it “respectively disagreed” with the ruling, adding that it was now considering its options. One option, of course, was to try to settle. And given that last September the court allowed the publishers to expand their case, boosting any potential damages pay out to $300 million, that presumably seemed like quite an attractive option.
That is possibly why yesterday the two sides announced that they had “fully settled the litigation brought last year by fourteen NMPA members. In addition, Peloton and the trade association have entered into a joint collaboration agreement and will work together to further optimise Peloton’s music licensing systems and processes”.
Despite having been pretty forthright in their criticism of each
other over the last year while both sides’ lawsuits went through the
motion, yesterday – with the settlement deal done – both the publishers
and the fitness fanatics were much more chummy.
“We are pleased the music publishers and their songwriter partners in
this case have reached a settlement with Peloton that compensates
creators properly and sets forth the environment for a positive
relationship going forward”, said Israelite.
“Peloton is an innovative company”, he added, “and we are impressed with its investment in technology and commitment to delivering a powerful, authentic music experience. We look forward to our ongoing collaboration to find solutions that will benefit all songwriters”.
Meanwhile Paul DeGooyer, Head Of Music over at Peloton, chipped in: “Music is an important part of the Peloton experience and we are very proud to have pioneered a new revenue stream for recording artists and songwriters”.
“We’re equally proud to partner with David and the NMPA to ensure that songwriters are, and continue to be, fairly compensated”, he went on. “With the NMPA’s input, we are confident our proprietary, state-of-the-art music system will provide an even more dynamic fitness experience for our millions of members worldwide”.
The Association Of Independent Music Publishers also welcomed the settlement deal. Its National Chair – Reel Muzik Werks CEO Teri Nelson-Carpenter – said: “The AIMP applauds the settlement between the NMPA and Peloton, and looks forward to seeing the results of their joint collaboration agreement. Going forward, it is imperative that all publishers and songwriters be compensated for the use of their works, and we will be monitoring the situation closely to ensure that independents are treated fairly and equitably”.
