Peloton has filed a Federal Maritime Commission complaint against Flexport, alleging that Flexport’s practices cost the fitness company millions of dollars in unreasonable charges.
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.
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“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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RC
They did the same to us, unfortunately it was before the latest law change so we weren’t able to fight them properly.
Abdullaah Hussain
“Failed to perform it’s Inland Transportation duties.” Lol Rookies
beentheredonethat
container drayage is completely done at the owner operator level. inland drayage is not at all digital, so if a driver told you he picked up a container off the rail or port and can’t produce an out gate ticket with a date and time (as well as a chassis receipt for out-gate), it probably wasn’t done at the “digital time recorded” The final delivery is very driver intensive and a lot of parties touch the product (receiving dock, driver, ocean carrier, chassis provider, CY, owner of goods and customs), etc. ask for receipts and signatures.
Ops
No surprise. We used Flexport for a short period in 2022 and had the same result. Constant problems, high demurrage and detention so we cut them off. We disputed and their answer was to pay us pennies back per shipment if we commit our volume to them. They came back a year later asking for our business again. EFW and CH Robinson have been rock solid handling port to door for us.
Shrek
If you want consistent reliable container deliveries take the time to select your own drayage providers. Ocean carriers are really good at moving containers to the port or inland rail CY, but the final mile drayage piece is a struggle. Ocean carriers have a set drayage rate, often below market, and dispatch loads to the cut rate providers. When ships are full they may not find a drayage provider willing to take the deliveries. Taking the time to coordinate your own deliveries is time and money well spent.
Damon Anderson
This is why we use MYEXPRESSFREIGHT.COM for everything. They are the best and they know everyone and get the job done! My sales rep drove 2 hours to the port to settle an issue with documentation and they never billed me additional for it! NOW THATS SERVICE!
averhu mcoaxunt
I listened to the flexport sales pitch several years ago and was basically like ok you actually have nothing to offer but smoke and mirrors.
Dangly
Not surprised, Ryan Petersen and Flexport are a bunch of crooks. Layoff 20% of your work force then several weeks later turn around and buy out the carcass formally known as Convoy. They will keep crawling back to Wall Street for shot in the arm “investment packages” but really are just using that to keep the poorly set up blackhole of a “logistics solution” known as Flexport.