Peloton (PTON) isn’t a big fan of copy-cats as the company came out hard against competitors, Echelon Fitness and iFit. The exercise bike maker that was in the press not so long ago for the injuries users were getting because of its treadmill product is now suing the two companies for copying its remote-workout technology.
Peloton claims that Echelon infringes one patent while iFit infringes five – all relating to features like exercise machines automatically adjusting workout based on performance and live leaderboards that rank users. Suing companies is costly, which makes it odd for why Peloton’s so dead-set on it despite it being cash-strapped. The company announced a few days ago that it’ll be releasing a $1b stock offering soon to, as it says, build up its acquisition pipeline and expand its manufacturing facilities. This is despite the CEO mentioning back in early November that it won’t be raising more cash.
why it matters
This isn’t Peloton’s first rodeo when it comes to legal disputes. Coupled with a stock issuance, the legal trouble isn’t doing Peloton any favours — the share price dropped by 7.5% yesterday.