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Peloton to Phase Out ‘Certain Designs’ After Legal Fracas With Lululemon

A New York judge has dismissed Peloton’s lawsuit against Lululemon Athletica, leading the way for the parties to resolve a separate legal dispute in California over alleged patent infringement claims that the exercise equipment manufacturer copied several of the athleticwear seller’s product designs.

“The parties have negotiated a mutually agreeable settlement, and are pleased the matters could be resolved amicably, resulting in dismissal of the pending litigation between them,” the companies said in a joint statement Friday. “Without admissions of any kind, in an effort to resolve the dispute, Peloton has agreed to phase out certain designs identified in the complaint by Lululemon.”

Peloton has not indicated which, or exactly how many, of these products will be phased out after the settlement.

The disagreement began when Lululemon sent a cease-and-desist letter to the now-Amazon and Dick’s Sporting Goods partner on Nov. 11, 2021, asking Peloton to stop selling the alleged copycat products. Lululemon and Peloton had been partners from 2016 to 2021, when Peloton sold co-branded Lululemon apparel. Peloton ended the partnership when it launched its own private-label apparel brand.

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On Nov. 24, Peloton filed a lawsuit in response to the letter, asking the court to preemptively declare that it had not infringed on Lululemon patents. Additionally, the company sought for the court to reject Lululemon’s “baseless” copyright infringement claims, saying they lack any merit because of clear differences that distinguish the sets of products, including the brand logos.

Shortly after Peloton’s filing, Lululemon filed a complaint of its own on Nov. 29 in a California district court, which accused Peloton of trade dress infringement, false designation of origin and unfair competition.

In the case, the athleisure seller alleged that Peloton infringed six design patents, calling out five “copycat” bra and legging products: Strappy Bra, High Neck Bra, Cadent Peak Bra, Cadent Laser Dot Bra and Cadent Laser Dot Leggings. Lululemon also called Peloton’s One Lux Tight a knockoff of its popular Align pants.

“Peloton used the delay to secretly prepare its own complaint and preempt the lawsuit that Lululemon had so clearly threatened in its letter,” the Vancouver, British Columbia-based company wrote in its complaint.

Lululemon also said in its claim that Peloton did not spend the time, effort and expense to create an original product line.

“Instead, Peloton imitated several of Lululemon’s innovative designs and sold knockoffs of Lululemon’s products, claiming them as its own,” the complaint said.

In response, Peloton argued Lululemon’s allegations lacked merit.

“Even a quick comparison of the Lululemon patented designs with the allegedly infringing Peloton products reveals numerous clear and obvious differences that allow the products to be easily distinguished,” Peloton said in court documents at the time.

Lululemon launches Studio service for Mirror users

Lululemon’s victory comes as the yoga pants purveyor preps its debut of the Lululemon Studio, a new home digital fitness service for owners of the Mirror platform. The $39-per-month service will launch alongside a new Lululemon membership program on Oct. 5.

The play finally brings to light where the Mirror fitness technology will fit in the go-forward plans for Lululemon, which acquired the at-home digital workout platform for $500 million in 2020.

The Studio builds upon more than 10,000 on demand and live-streamed classes that have been available with a Mirror subscription, and offers content from the company’s fitness and wellness partners across North America.

Studio members will have access to weekly online classes, either at home or through the mobile app, via fitness partners like Aarmy, Y7 Studio, Dogpound, Forward_Space, Pure Barre, Rumble, AKT and YogaSix. Members will also be able sign up for in-person discounted classes at the studios’ brick-and-mortar locations, in addition to receiving 10 percent discounts on product and early access to Luluemon events.

“Our guests’ fitness needs have evolved and Lululemon Studio is solving for them by providing members with access to fitness content from our world-class trainers and studio partners at home, on the go and live in studios around North America,” said Nikki Neuburger, chief brand officer, Lululemon, in a statement. “Lululemon Studio unlocks the versatility our community has told us they are looking for now. No longer will you have to choose between going to your favorite studio or streaming a class at home—you can have both.”

A Mirror typically costs $1,495, but Lululemon will temporarily cut the price to $795 and deliver the system for free as of Oct. 5 to generate more accessibility. The workout platform, which includes a five-megapixel front-facing camera, is designed to let users take streamable, virtual classes that include cardio, yoga or even boxing.

“Mirror has always been one of the most flexible platforms that can adapt to changing fitness trends. With Lululemon Studio, we’re expanding our offering to solve for our guests’ needs, extending our relationships with new studio partners and our ambassadors to add hundreds of hours of content in one place, while providing access to in-person studio classes for the ultimate hybrid experience,” said Michael Aragon, CEO, Lululemon Digital Fitness. “We see Lululemon Studio as being the daily go-to destination for experiencing the most dynamic content from the industry’s top trainers and studios, covering a range of fitness genres for all levels.”

Lululemon says all North American guests can sign up for its “essential” membership plan for free. Although the essential membership is not tied directly to Mirror, members can still get access to select Lululemon Studio classes at no cost, as well as early access to product drops and receipt-free returns in store.

Mirror appears to be a major part of the Lululemon branding going forward, but the technology has also put the company in the legal crosshairs of another athletic apparel giant. Nike filed suit against Lululemon in January over patent infringement claims, saying that Mirror and its apps violate six patents issued to the Swoosh between 2013 and 2021. That case is still ongoing.