NEW YORK (Legal Newsline) - A federal judge won't certify a class of Peloton customers in a lawsuit filed after the company's digital content library was slashed in half.
New York judge Lewis Liman on May 2 denied the plaintiffs' motion to proceed as a class action on behalf of all New York purchasers of Peloton hardware or memberships from April 2018 to March 2019.
Attorneys at DiCello Levitt Gutzler in New York and Keller Lenkler in Chicago filed their motion for certification Oct. 17, 2022. Liman had previously rejected their effort to certify a nationwide class.
Peloton was forced to slash a library it boasted as "ever-growing" after the National Music Publishers Association sent it a cease-and-desist order regarding unlicensed music. It resulted in a $150 million lawsuit by several of the group's members.
Hooking customers with its promise of a growing library while cutting half of it violated consumer protection laws, the suit says.
A survey by J. Michael Dennis showed 49% of respondents would be extremely or moderately concerned if Peloton were forced to remove 50% of its classes as plaintiffs tried to show subscribers wouldn't have paid as much for their memberships if they'd known the library would be halved.
"However, this survey, which was designed to measure materiality, says little about whether a price premium existed..." Liman wrote.
"If a consumer is 'concerned' by the removal of the on-demand classes from Peloton's library, it does not necessarily follow that these concerns would have caused consumers not to purchase Peloton products, resulting in a price premium."
The only data shown to Liman regarding a price premium contradicted the plaintiffs' claims, Liman wrote.
"(T)he price of Peloton products stayed the same for nearly 18 months after the class period and, according to Defendant's designated witness on the issue of the consumers to the removal of the classes, there were only 'a single-digit number of subscription cancellations that were directly attributable to... the on-demand classes removed from [Peloton's] library in March 2019."