Bizarre Combo Rulings From EU Court Of Justice: Dentists Don't Have To Pay Music Royalties, But Hotels Do

from the see-if-you-can-figure-it-out dept

Over the last few years, collection societies have become ridiculously aggressive in trying to get just about anyone to pay up for playing music. The results have been rather crazy, with auto garages being told that they have to pay up because the mechanics out in the garage had the radio on loud enough that customers in the waiting room could hear it. Ditto for a police station where some officers had a radio on in the back, but which some of the public could hear in the front. Then there was the demand that a grocery story pay up because a shop assistant sang while stacking cans. And the craziest of all: the time when the owner of a horse stable was told to pay up because her horses liked listening to music.

A lot of this comes from the simple fact that these collection societies are really just trying to squeeze as much excess revenue as they can out of any location they can find. It's gotten to the point where the "copyright investigators" are really sales people, and are given incentives just like a sales person. They have revenue targets with bonuses for extra revenue they bring in. This gives them incentives to do all sorts of crazy things... like randomly calling up small businesses and if they hear any music in the background, demanding a license.

Thankfully, it appears that the EU Court of Justice is pushing back on some of that. It recently issued two rulings about royalty collections -- but unfortunately it seems like the two rulings conflict with each other in some ways. In one, it is determined that a dentist's office does not need to pay a royalty because patients don't go to the dentist for the music:

Finally, it cannot be disputed that, in a situation such as that in the main proceedings, a dentist who broadcasts phonograms, by way of background music, in the presence of his patients cannot reasonably either expect a rise in the number of patients because of that broadcast alone or increase the price of the treatment he provides. Therefore, such a broadcast is not liable, in itself, to have an impact on the income of that dentist.

The patients of a dentist visit a dental practice with the sole objective of receiving treatment, as the broadcasting of phonograms is in no way a part of dental treatment. They have access to certain phonograms by chance and without any active choice on their part, according to the time of their arrival at the practice and the length of time they wait and the nature of the treatment they undergo. Accordingly, it cannot be presumed that the usual customers of a dentist are receptive as regards the broadcast in question.

Consequently such a broadcast is not of a profit-making nature...

Of course, you could make the identical argument about music playing in all sorts of places. But, at the very least, it certainly suggests that the music playing at an auto mechanic's garage or a police station are not subject to royalty collections under EU law.

But then there's the other ruling. The exact same court. The exact same panel of judges. The exact same day. Very different ruling. This one involved a hotel, and the question of whether or not music playing in the hotel rooms is subject to collections. And here, the court comes to the opposite conclusion, and says that the hotel must pay.

In a press statement, the Court said that since music in hotels is broadcast to an "indeterminate number of potential listeners" and is "of a profit-making nature" hoteliers are liable for royalty payments. It added that broadcasting music constitutes an "additional service which has an influence on the hotel's standing and, therefore, on the price of rooms."

I'm having difficulty figuring out the difference here. The article linked above notes that these rulings hinge on "the concept of public" which is based on "'an indeterminate number of potential listeners and a fairly large number of persons,' alongside the question of a profit motive." However, it seems like a total judgment call in either case as to whether or not there is a "fairly large number of persons" and just where "the profit motive" comes into play. Both dentists and hotels have a profit motive, and both play music in part because of that reason. But it's arguable as to whether or not the music has a direct impact on actual profits in either case. In the end, the pair of rulings just seems to leave everything a lot more confused, rather than clarified in any way.

Filed Under: collection societies, dentist offices, eu, hotels, music, pros, royalties