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Peloton sued for allegedly stealing artists' music

  • A lawsuit seeking damages of more than $150 million charges Peloton with using unlicensed music in its video workouts
  • The suit says the fitness company is using more than 1,000 unlicensed songs
  • Artists whose work is involved include Rihanna, Justin Timberlake, Lady Gaga, Bruno Mars and Ed Sheeran
  • Peloton says "We have partnered with each of the major music publishers, record labels and performing rights organization"

Peloton, a fitness technology company known for its heart-pumping, music-driven cycling workouts, is being sued for allegedly using more than a thousand unlicensed songs in its popular workout videos. Nine music publishers, all members of the National Music Publishers' Association (NMPA), filed a lawsuit seeking more than $150 million in damages. 

They allege Peloton knowingly and willfully infringed, using plaintiffs' songs in workout videos without obtaining synchronization, or "sync," licenses. These licenses give a music user permission to release a song in video format. 

"There is no doubt that Peloton's infringement was and continues to be knowing and reckless. Peloton fully understood what the copyright law required, having entered into sync licenses with certain other copyright holders, while trampling the rights of Plaintiffs by using their musical works for free and without permission," the suit states. 

Artists whose work was used without permission include Rihanna, Justin Timberlake, Lady Gaga, Bruno Mars, Ed Sheeran and others. The plaintiffs -- music publishers -- collect income from licenses and pay a portion of it to songwriters, who rely on license fees.

Integral part of the experience

Peloton is best known for its stationary exercise bikes and treadmills with touchscreens that stream videos of live and on-demand indoor classes led by instructors. Music is an integral part of the Peloton experience. 

"Indeed, Peloton has publicly acknowledged that its consumers 'embrace music as central to the Peloton experience and consistently rank it as one of the top aspects of the brand,'" the lawsuit states. "There is no question as to the deliberate and willful nature of Peloton's infringement of Plaintiffs' copyrighted musical works."

NMPA President and CEO David Israelite agrees music is largely responsible for the brand's success. "Unfortunately, instead of recognizing the integral role of songwriters to its company, Peloton has built its business by using their work without their permission of fair compensation for years," he said in a statement. "It's frankly unimaginable that a company of this size and sophistication would think it could exploit music in this way without the proper licenses for this long, and we look forward to getting music creators what they deserve."

Peloton launched its at-home streaming classes in 2014 and was recently valued at $4 billion. The company said it's evaluating the complaint, filed Tuesday. 

"Peloton has great respect for songwriters and artists," a Peloton spokesperson said in a statement to CBS MoneyWatch. "In fact, we have partnered with each of the major music publishers, record labels and performing rights organizations, and many leading independents. We have also invested heavily to build a best-in-breed reporting and licensing system to support our partners and provide our members with a world-class fitness experience."

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