Icon Says Peloton Theft Claim Is Retaliation for Patent Dispute

Icon Health & Fitness Inc., maker of NordicTrack exercise equipment, said a new lawsuit by rivalPeloton Interactive Inc. was “baseless” retaliation for a patent-infringement claim Icon made against Peloton last month.

Peloton, which makes indoor bikes and treadmills, alleged Icon tried to steal its advertising plans from a contractor, according to a request Monday for permission to file the complaint under seal in federal court in Wilmington, Delaware. Peloton asked the court to block Icon from using its trade-secret advertising materials “for any purpose.” Peloton has seven days to file a redacted public version of the complaint it filed under seal.

The legal fight between the companies has expanded as demand surged for exercise equipment during the pandemic, which forced more people into workouts at home. In alawsuit filed last month, Icon said it obtained “hundreds of patents on these systems before Peloton was founded.” In May, Pelotonclaimed Icon copied its interactive fitness programs and lied in advertising to undercut its rival.

Peloton’s theft claim is “an unabashed attempt to distract people” from its “ongoing and brazen misappropriation of Icon’s intellectual property,” Icon lawyer Sterling Brennan said.

In public court filings, Peloton said the confidential information Icon allegedly tried to steal included its “planned advertising and marketing strategy, descriptions of the advertisements and strategic discussions, and future confidential, unannounced features and plans.” The information also included excerpts of contracts between Peloton and its advertising and production companies, court documents show.

The stakes are high for both companies. Peloton’s leveraging of its patents and trademarks to block low-cost rivals from undercutting it on hardware and offering similar interactive exercise classes is “a risky strategy,” Bloomberg Intelligence analyst Tamlin Bason wrote Nov. 10 in anote. “Peloton has relatively few patents, meaning any patent invalidations could deal a harsh blow,” she wrote.

The case is Peloton Interactive Inc. v. ICON Health & Fitness Inc., 20-cv-1535, U.S. District Court, District of Delaware (Wilmington).

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