Supreme Court dismisses the claims of two copyright collecting societies against a major retailer

The Supreme Court of Justice of Moldova (SCJ) had recently pronounced its judgment in a case in which two copyright collecting societies claimed royalties and penalties from METRO Cash & Carry, a major foreign retailer present in the Moldovan market, for playing music in its stores without licence.

The case was initiated in 2014 when two separate claims were launched by the aforementioned societies against METRO. One of the societies (AsDaC) claimed that it signed several licence agreements with the retailer, but after 2012 METRO did not honour its contractual obligation relating to royalties. However, the SCJ found that for the period for which the claim was brought by the collecting society for non-payment of royalties, this society was not authorized by the national intellectual property agency (AGEPI) to collect such payments on behalf of copyright owners.

In fact, several collective management organisations (or collecting societies) exist in Moldova to represent rights holders and often compete with each other. To avoid the conflicts between various societies, the intellectual property agency establishes the types of rights which are managed by particular organizations. In case if several societies pretend to manage similar rights, the Agency can establish the order in which each society is given the management rights and the periods for which the respective society is granted with that privilege.

Another situation considered in this case was parallel representation by different societies. Two societies claimed royalties from the retailer for the same period of time. While only one of them was assigned as the collecting society for the period of August-December 2012 (National Association for the Protection of Intellectual Works), the payments were by METRO to the other society (AsDAC) on the basis of the agreements signed with the latter. As a result, the claims for royalty payments brought by the first society were dismissed given the fact the retailer paid royalties to another society (which in its turn made subsequent payments to the partner societies from other countries representing right owners).

Therefore, the Court dismissed the claims by the society which was authorized to collect royalties on the basis that the licensee had already paid royalties to another society.

Another important aspect of the case involved the evidence of unauthorized use that collecting societies had to submit to support their claims. The defendant claimed that for a certain period of time (for which the collecting society claimed royalties) there was no music played in the stores. Respectively, no right to royalty could arise. The fact that there were agreements signed with one of the societies for that period of time did not automatically produce the obligation to pay royalties, if no music was effectively used. Therefore, the collecting societies claiming royalties have to produce evidence of unauthorized use of works, and provide details as to which works were used. In this case such evidence was not provided by the claimant.

* If you want to learn more about the rules of collective management of copyright and other related rights or generally about intellectual property protection in Moldova, do not hesitate to contact us.

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