Simpson v. Peloton Interactive, Inc.

Background

On September 17, 2020, Brody Simpson filed a petition asking the court to confirm an arbitration decision. Simpson also moved to seal nine words in the petition and to file the American Arbitration Association’s interim and final decisions completely under seal. The motion stated that Peloton agreed with the request.

The court then directed the parties to explain why the arbitration decisions were not judicial documents subject to the presumption of public access, or alternatively to propose narrower redactions for information that was legitimately confidential. Peloton responded with a motion seeking approval of redacted versions of the petition and the two arbitration decisions. Simpson did not consent to Peloton’s motion.

Court’s Analysis

The court denied Peloton’s motion as overbroad.

First, Peloton sought to redact references to copyright disputes and to the decrease in the size of its on-demand class library. The court acknowledged that these facts might be embarrassing to Peloton, but held that avoiding embarrassment was not a sufficient higher value to overcome the presumption of immediate public access. The court also noted that Peloton’s removal of classes because of copyright disputes had been discussed publicly. The request to redact those facts was denied.

Second, Peloton sought to redact the names of individuals associated with other cases against Peloton. The court noted that Peloton did not claim that the individuals were minors, that their cases had been filed under seal, or that they had a specific privacy interest sufficient to overcome the presumption of access. The court denied this proposed redaction.

Third, Peloton sought to redact an arbitrator’s acknowledgment that Peloton’s rejected interpretation of “ever-growing” coincided with the filing of litigation. The court recognized Peloton’s disagreement with the arbitrator’s characterization, but found that the interpretation did not provide valuable insight into current business practices that a competitor could exploit. The proposed redaction was denied.

Fourth, Peloton sought to redact the number of classes added or removed during particular periods, along with information and quotations from an internal document describing a communication strategy intended to retain members. The court found that the number of classes over time and member-retention strategies were sensitive business information that competitors could use to obtain marketing and product-development insights. Peloton was permitted to redact that information.

Disposition

Judge Valerie Caproni denied Peloton’s motion for approval of the redacted filings as overbroad. The court ordered the parties to refile the petition to confirm arbitration and its supporting exhibits consistently with the order by November 4, 2020. The court also directed the parties to follow Rule 5B of its Individual Practices, including highlighting proposed redactions in unredacted documents filed under seal. The Clerk was directed to terminate the motion at docket entry 15.