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Peloton’s $4000 Treadmills Bricked Unless Owners Pay $39/mo Fee

Tread+Imagine buying a $4,000 treadmill and then being told unless you buy an online membership program for $39 a month, the company will disable the machine, making it a very expensive doorstop.

That is exactly what Peloton, the maker of high-end exercise devices, including the recently recalled $4000 Tread+ treadmill, is doing to its customers who own this model.

The company had to come up with a fix to keep young children from turning on the machine and accidentally getting sucked under its moving belt. So, they now require entering a password on the treadmill’s screen to operate it. And the unit will also stop functioning after 45 seconds of inactivity. To start it up again, the user has to re-enter the passcode.

But there’s just one problem.

*MOUSE PRINT:

Apparently, to implement the operation of the new locking and password mechanism, a recent software update removed the “Just Run” option from users’ screens. That mode lets users operate the treadmill without the online interactive features and classes that have made the brand so popular.

So, how do users get to use the machine on their own AND have the safety features enabled? They have to buy a $39 a month membership.

Peloton membershipEmail sent to Business Insider from unhappy owner

Customers have taken to the Internet to complain that in essence Peloton is bricking their exercise equipment if they refuse to sign up for a membership.

A spokesperson for Peloton has said in published reports since the controversy erupted that it is working on updates to its software to remedy the problem. Upset users are considering suing the company if a fix is not forthcoming.

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Amazon Quietly Changes Terms of Service Dropping Mandatory Arbitration

In a move consumer advocates never thought they would ever see, a major company, Amazon, has dropped from its terms of service the mandatory arbitration clause to settle disputes. This now allows Amazon customers to sue them in court and be part of class action lawsuits.

The change occurred on May 3, 2021, with no announcement or fanfare, as first reported last week by the Wall Street Journal.

The new language in Amazon’s “conditions of use” is short and sweet.

*MOUSE PRINT:

DISPUTES
Any dispute or claim relating in any way to your use of any Amazon Service will be adjudicated in the state or Federal courts in King County, Washington, and you consent to exclusive jurisdiction and venue in these courts. We each waive any right to a jury trial.

The change came about because some brilliant consumer lawyers used Amazon’s old mandatory arbitration rules to their own advantage. Those rules provided that Amazon would cover consumers’ arbitration filing fees. So what did these lawyers do? They filed 75,000 arbitration cases on behalf of Amazon Echo owners complaining that the smart speakers recorded users without their permission. That move triggered a bill for tens of millions dollars in filing fees that Amazon was asked to pay.

For reference, here is Amazon’s old rule mandating arbitration of claims:

*MOUSE PRINT:

DISPUTES
Any dispute or claim relating in any way to your use of any Amazon Service, or to any products or services sold or distributed by Amazon or through Amazon.com will be resolved by binding arbitration, rather than in court, except that you may assert claims in small claims court if your claims qualify. The Federal Arbitration Act and federal arbitration law apply to this agreement.
…
Payment of all filing, administration and arbitrator fees will be governed by the AAA’s rules. We will reimburse those fees for claims totaling less than $10,000 unless the arbitrator determines the claims are frivolous. [Emphasis added]
…
We each agree that any dispute resolution proceedings will be conducted only on an individual basis and not in a class, consolidated or representative action. If for any reason a claim proceeds in court rather than in arbitration we each waive any right to a jury trial.

What doesn’t quite make sense is that Amazon’s old rule only promised to reimburse consumers’ filing fees and not that they would pay them upfront. So we asked the consumer lawyer who filed these tens of thousands of arbitration cases and then billed Amazon for millions in filing fees to explain if he really laid out all that money from his own pocket to file these cases. He did not respond.

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Old Navy Deceptive Pricing Case Settled

In 2019, we reported that a Washington state consumer was suing Old Navy for advertising phony discounts from artificially high regular or original prices. [See complaint.] Now, lawyers announced they have reached a tentative settlement subject to court approval. No details of the settlement were released, but some type of payment to affected shoppers is likely, along with some guidelines on future advertising of discounts.

Lawyers for the consumer really prepared for this case by tracking millions of prices on the Old Navy website for two years, and found that those items virtually never sold for the stated full, regular price. Since most merchandise at Old Navy is their own brand, the company sets its own inflated list/regular/original price on their goods thus making their current sale prices seem like bigger bargains than they really are.

*MOUSE PRINT:

Old Navy Pants

As an example from Old Navy’s website earlier this year, the crossed-out price of $34.99 allegedly was rarely if ever charged, so shoppers are being misled into believing that they will save over $22 on this item if purchased now.

We’ll post information in Consumer World on how to file a claim in the Old Navy when the settlement is finalized.