Peloton is facing scrutiny from the US Department of Justice and the Department of Homeland Security over how the company handled the product recall for the Tread+.
In a Friday securities filing, Peloton revealed both federal agencies have subpoenaed the company “for documents and other information related to our reporting of the injuries associated with our products.”
The filing adds that the US Securities and Exchange Commission is also investigating Peloton over its “public disclosures” on the matter. The company declined to comment on the federal inquiries, but in the filing, Peloton said: “We intend to cooperate fully with each of these investigations, and at this time, we are unable to predict the eventual scope, duration or outcome of the investigations.”
Peloton recalled the Tread+ treadmill in May after the US Consumer Product Safety Commission (CPSC) concluded the product could easily pull a nearby child underneath the treads.
However, Peloton initially resisted a recall. In March, CEO John Foley urged product owners to keep children away from the Tread+ amid reports that it caused the death of one child and injured dozens of others, but said the death was among a “small handful” of incidents the company was aware of involving the Tread+.
In April, Peloton framed the findings from the CPSC as “inaccurate and misleading.” But a month later, Foley acknowledged that he made a mistake with the company’s initial response to a CPSC request to recall the Tread+. “We should have engaged more productively with them from the outset,” he said at the time.
Why DHS is involved in scrutinizing Peloton remains unclear. The federal agency didn’t respond to a request for comment. In the meantime, the company has pulled sales for the Tread+. However, the company is relaunching sales for a less expensive model, simply dubbed Tread, after adding new safety features.
