Peloton Takes a Spin Through Court, Thanks to AI Privacy Lawsuit

Exercise-bike maker Peloton Interactive Inc. has been grappling with a class-action lawsuit alleging that marketing firm Drift, which operates using AI, processed chat data between Peloton users and company representatives without user permission.

Peloton has been accused of violating the anti-wiretapping California Invasion of Privacy Act (CIPA), according to Malwarebytes Labs. Though it's Drift that is accused in the lawsuit, the lawsuit itself is against Peloton.

The user chat data comes from the chat function on the Peloton website that allows current or potential customers to ask questions. According to the complaint, the users were not notified that Drift was recording and analyzing the chat content.

"The issue at hand is whether or not Peloton sought the affected users' permission before conveying their information to Drift," said Malwarebytes Labs. "Although Peloton has the right to go through the chat content as it is a part of the conversation, the real problem is the passing of this information to Drift."

Drift focuses on personalizing communication at every stage of the purchasing process, storing and analyzing customer chat data to further tailor its AI.

This is not the first AI legal case. In 2023, employees at Samsung Electronics leaked company information through ChatGPT, highlighting the risks of using machine learning and large language models in the workplace when the shared data ultimately becomes training data for these machines.

Though it's unclear which way the court will rule regarding Peloton and Drift, this lawsuit is likely to have a negative impact on the companies as pushback against user input for AI training purposes continues.