Peloton: Flexport Wrongly Charged Millions in Detention, Demurrage Fees

The complaint, filed this month, accuses digital freight forwarder Flexport of "wrongfully and unreasonably requiring Peloton to pay millions of dollars in unreasonable demurrage and detention charges." Peloton used the company to handle its global logistics.

San Francisco-based Flexport transported Peloton containers between foreign and U.S. ports and to locations across the country. With the "store door shipments" also referred to as "carrier haulage" Flexport was responsible for arranging and paying for all aspects of the inland movement of the Peloton cargo, the complaint says.

The complaint accuses Flexport of improperly invoicing Peloton from 2020 through 2023, violating the Shipping Act. Flexport "repeatedly and chronically" failed to perform its inland transportation obligations, including not removing Peloton containers from ports, not delivering containers to their destinations in a timely manner and not returning empty containers on time, the complaint says.

This led New York City-based Peloton to eventually use a 3PL to manage the inland intermodal transportation of some containers.

Flexport improperly charged Peloton on the carriage of goods arranged by Flexport despite the terms and Flexport's responsibility to manage inland transportation, the complaint says. Flexport charged Peloton without first evaluating if the logistics company was responsible for the charges.

"Flexport strictly complies with the Ocean Shipping Reform Act and all other rules and regulations within the Shipping Act. We go above and beyond to help all our customers ensure on-time delivery and minimize detention and demurrage charges, especially in times of stress like the supply chain crisis that many businesses faced during the pandemic" Flexport said in a statement to FreightWaves. 

The complaint accuses Flexport of not providing Peloton with detailed invoices related to the demurrage and detention charges, which didn't give the fitness company the ability to understand or dispute the charges.

Peloton says it held numerous discussions with Flexport about its claims but wasn't able to resolve the dispute. The fitness company is asking the FMC to order Flexport to cease and desist alleged unlawful conduct and to pay unspecified reparations.

Peloton didn't immediately respond to an inquiry about the complaint.

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