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Publishers deny collusion in copyright battle with fitness firm

By | Published on Thursday 27 June 2019

National Music Publishers Association

A group of music publishers in America have bit back at allegations that they colluded in an anti-competitive way in a dispute with fitness company Peloton.

More than a dozen independent publishers sued Peloton earlier this year accusing it of making use of their songs without licence. Peloton makes fitness machines that come with screens via which users can access workout videos. The lawsuit alleged that some of those videos contained unlicensed music controlled by the plaintiffs.

Peloton then countersued in April, 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 trade body, it reckoned, had its own agenda, because it wanted Peloton to pay blanket licensing fees to cover a much larger repertoire of songs than it actually needed access to.

The NMPA was disparaging of Peloton’s allegations from the off, and the publishers behind the original lawsuit presented various arguments against the collusion and antitrust claims in a new legal filing this week.

Seeking to have the countersuit dismissed, the publishers argue that Peloton has resorted to making arguments involving competition law because it can’t defend itself under copyright law in relation to the core allegations of infringement.

Or, in the words of this week’s legal filing, “having no defence to its copyright infringement, Peloton resorts to the timeworn tactic of asserting a baseless antitrust counterclaim”.

Peloton’s countersuit pointed to the fact that many of the publishers involved in the litigation had called off their licensing talks with the fitness company at more or less that same time, suggesting that the NMPA had orchestrated the cancellations.

However, the publishers argue that the original lawsuit itself was the motivating factor for them ending ongoing negotiations. It stands to reason that any publisher that had decided to participate in the legal action would stand down from licensing talks once it knew that the lawsuit was about to be filed with the courts.

This week’s legal filing goes on: “The timing of the alleged discontinuation of the negotiations – shortly before or at the time the copyright lawsuit was filed – presents an obvious explanation. Each of the publishers that reached a decision to sue Peloton for copyright infringement would have an obvious reason to discontinue further negotiations”.

The publishers also argue that – other than noting how they all cut off negotiations at around the same time – Peloton hasn’t presented any actual evidence of collusion. Yes, all the plaintiffs are members of the NMPA, but participation in a trade organisation does not raise competition law concerns. Plus Peloton itself has confirmed that it has licensing deals in place with other publishers that are also NMPA members.

The publishers have requested a court hearing to consider their motion to have Peloton’s countersuit dismissed. The fitness outfit is yet to comment on the latest legal filing.