Peloton fires back at music publishers with a countersuit

One month after a group of music publishers sued it for copyright infringement, Peloton is firing back with a countersuit claiming anticompetitive conduct. On Tuesday, the New York-based fitness startup filed an answer to a complaint by members of the National Music Publishers’ Association and other publishers in U.S. District Court of the Southern District of New York.

“Peloton is not the bad actor that Plaintiffs portray it to be,” the 46-page counterclaim reads. “Peloton values the musical element of its service offering and respects — and pays — the music rightsholders associated with that offering.”

The legal move is a response to a March filing in which several members of the National Music Publishers Association, such as The Royalty Network, sued 7-year-old Peloton, seeking damages in excess of $150 million for allegedly using unlicensed recordings from high-profile musicians including Bruno Mars and Lady Gaga. Many in the music business were surprised that a company of Peloton’s size could be in violation of licensing rights.

But Peloton Interactive disputes the claim, saying it has licenses from all major and many independent record labels, publishers and performing rights organizations representing the songwriters it uses. The brand says it has invested heavily in creating a licensing structure for its unique business model, which allows users to stream music from home as they cycle on its bikes. In the claim, Peloton alleges the NMPA and its publishers have engaged in anticompetitive conduct to “fix prices and to engage in a concerted refusal to deal with Peloton.” The fitness brand is seeking financial relief for the damages it says it sustained from the lawsuit and for the expense of litigation.

Peloton's suit continues, “Through these actions, NMPA has exceeded the bounds of legitimate conduct for a trade association and become the ringleader of concerted activity among would-be competitor music publishers, all in violation of the antitrust laws.”

Also on Tuesday, the NMPA responded to Peloton’s new filing with a statement alleging that the claim has no merit and that it will continue its fight for payment for musicians.

“The NMPA routinely defends the interests of its members’ copyrights in order to protect their value, prevent future infringement and to seek damages to which they are entitled under the law when their property has been stolen,” NMPA EVP and general counsel Danielle Aguirre said in a statement. “Peloton’s countersuit is further evidence that it does not value its relationship with the music industry but is instead hostile to the people without which it could not have built its thriving business.”