All Shook Down

It started with letters in the mail. Then there were the spies. Then one day at an unglamorous neighborhood coffee shop in South Minneapolis, the phone rang. “I’ve been to your café. I know you have a CD player,” said the voice on the phone. Paul knew he was in trouble. It was true; there was a CD player in his café. And if he didn’t do something about it, it could cost him $150,000.

Like most café owners, Paul (last name withheld) doesn’t have $150,000 to throw away. But the caller, a licensing representative with the American Society of Composers, Authors and Publishers (ASCAP), has the legal muscle of a half-a-billion-dollar corporation behind him. And Paul’s CD player, though innocent-looking enough, is really a delivery system for the unlicensed performance of copyrighted works that might be registered with ASCAP. Copyright law provides for fines of up to $30,000 per infringement—$150,000 for willful infringement.

Welcome to the world of intellectual property. Pop a CD you paid for into a stereo you paid for in the business you are in hock for. Push play, and check your bed for severed horse heads in the morning.

One might think, for example, that royalties had already been paid when the CD was purchased. True, but that’s called a mechanical royalty, and it’s collected and distributed by the publisher. So why not just play the radio? The stations have already paid the royalties for that, right? Well, get out your tape measure; if your establishment has more than 3,750 square feet (not including parking lot), you need to pay for radio. Got a jukebox? That means you need a “JLO”—a royalty agreement specifically for jukeboxes. What about the bearded, sincere folk guitarist who plays for tips on Saturday nights? Well, he might play a cover of a song copyrighted by someone else, and then you are on the hook, not him.

“Performance rights” are a whole and separate animal from other copyrights, and they are held by only three Performing Rights Organizations (PROs): ASCAP, Broadcast Music Incorporated (BMI), and the Society of European Stage Authors and Composers (SESAC). They have lately come calling to local coffee shops and bars to get their piece of the action. Ask nearly any coffee-shop owner or operator in the metro area about license fees, and terms like “Cosa Nostra” or “protection racket” are bound to come up.

“Somewhere between the Mafia and the Inquisition,” said Paul, describing ASCAP, the day I visited his café. A St. Paul coffee-shop owner, who requested anonymity, echoed, “They really are the music mafia.” Kate Hepp of Gigi’s in South Minneapolis, who has paid BMI for “protection,” told The Rake, “It’s very intimidating, the letters you get.”