Peloton Fined $19 Million for Dangerous Product Safety Violations Involving Tread+ Treadmills

The company initially failed to report injuries, and distributed potentially hazardous treadmills after the Tread+ had been recalled

Kevin Loria, Consumer Reports Senior Health & Food Reporter.

By Kevin Loria
Senior Health & Food Reporter

January 5, 2023

Peloton Interactive has agreed to pay a $19,065,000 fine to settle charges that the company failed to report to the Consumer Product Safety Commission that its Peloton Tread+ treadmill was defective and posed an unreasonable risk of serious injury, the CPSC announced Thursday.

As part of the settlement, Peloton has also agreed to maintain an enhanced compliance program and system of internal controls to ensure compliance with federal law. The company will file five years of annual reports detailing this compliance program, the CPSC said.

The agreement also settles charges that the company knowingly distributed recalled treadmills, in violation of the Consumer Product Safety Act.

The fine is one of the highest the agency has imposed in recent years. It is actually higher than the current maximum amount permitted for a series of related violations ($17.15 million) because it includes a further penalty for the company’s conduct after the Tread+ recall. (CR has called for Congress to remove the cap on such penalties.)

The Tread+ design created a unique hazard, with the treadmill pulling people and objects and trapping them under the rear of the machine, leading to a number of serious injuries and one child’s death.

“Peloton failed to put safety first, and children paid the price,” William Wallace, CR’s associate director of safety policy, said in a statement. “Today the CPSC is holding Peloton accountable with multimillion-dollar penalties and a supervised compliance program. These actions should help ensure Peloton improves its safety culture going forward.”

In a statement provided via email, Peloton said: “Peloton remains deeply committed to the safety and well-being of our Members and to the continuous improvement of our products. We are pleased to have reached this settlement agreement with the U.S. Consumer Product Safety Commission (CPSC) and look forward to working cooperatively with the CPSC to further enhance Member safety. As such, Peloton continues to pursue the CPSC’s approval of a Tread+ rear guard that would further augment its safety features.”

The Tread+ is currently not on the market.

According to the CPSC’s announcement, in December 2018, Peloton started to receive reports of incidents in which people, pets, or objects were pulled and trapped under the rear of the Tread+ treadmill. By the time the company notified the CPSC, the company had received more than 150 reports of such incidents, including the death of one child and 13 injuries including broken bones, lacerations, abrasions, and friction burns.

“Despite becoming aware of more than 150 reported incidents of persons, pets and/or objects being pulled under the rear of the Tread+ treadmill, it was not until after receiving notice that a six-year-old child had died after being entrapped under the rear of the treadmill that Peloton reported these incidents to the CPSC,” Alexander Hoehn-Saric, the CPSC chair, said in a statement. “By failing to report these incidents to the Commission immediately, Peloton not only violated the Consumer Product Safety Act, but also consumers’ trust.”

In April 2021, the CPSC issued an urgent safety warning, telling consumers with small children or pets “to stop using the product immediately.”

Peloton initially refused to recall the product, but on May 5, Peloton issued a recall of the Tread+, telling consumers to stop using the machines and to contact the company for a full refund.

The company recalled its Tread treadmill on the same day, for a different hazard regarding the touchscreen falling. That hazard for the Tread has been fixed, and the Tread currently on the market is an updated model, with the touchscreen console securely attached.

After the 2021 recall, Peloton knowingly distributed 38 Tread+ treadmills using Peloton personnel and through third-party delivery firms, according to the CPSC.

“Every company should take heed of these penalties,” CR’s Wallace said. “It’s much better for safety, public relations, and your bottom line to be proactive and make sure you’re following the law.”