Flywheel initially denied the allegations and a spokesperson told The Wall Street Journal that the case was “a classic example of a big business trying to intimidate a competitor out of the marketplace.”
Flywheel settled out of court in February, 2020, admitted to using elements of Peloton’s patented technology and promised to cease infringement. According to Bicycling, Flywheel also informed its customers they will no longer be offering in-home classes and customers would be eligible to trade in their Flywheel bike for a refurbished Peloton bike. Customers would still need to pay the Peloton subscription fee for access to classes.
Challenging patents
Peloton innovated in the market and then they patented those innovations, which give them certain rights, including the right to exclude others from manufacturing, distributing, or selling an invention. This means that companies who hold patents on valuable technology can prevent competitors from profiting from that technology.
Peloton relies on their patents to protect the value of their product. Bloomberg reported on statements from Peloton’s IPO document which suggested that challenges to intellectual property and patents could decrease the value of their brand.
