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Vasil Kisil & Partners and McDonald’s Win the Case over Public Performance of Phonograms in Chain’s Restaurants

22/ 07/ 2020
  Vasil Kisil & Partners’ team has successfully represented McDonalds Ukraine in the case against Ukrainian League of Copyright and Related Rights (ULCRR). ULCRR filed a lawsuit against McDonalds, seeking remuneration for public performance of phonograms in the chain’s restaurants. ULCRR is the only accredited collective management organization (CMO) authorized to collect remuneration for this type of use of phonograms in Ukraine. The plaintiff contended that McDonalds was obliged to enter into an agreement with the plaintiff, regardless of the actual circumstances of use. However, McDonalds entered into remuneration agreements directly with the holders of related rights to phonograms and performances. The rights holders withdrew their rights from management of ULCRR, which is why the latter had no right to collect remuneration for their phonograms. The courts of two instances dismissed the ULCRR’s lawsuit, and the Supreme Court refused to commence cassation proceeding. The courts found that ULCRR had no right to file such lawsuit. The law stipulates that in order to apply to a court for the protection of property rights ULCRR must obtain a power of attorney from the rights holders. The assessment of the right to file a lawsuit is essential for this category of disputes, and there are currently several dozens of them.  The project was handled by the Intellectual Property team composed of Ilarion Tomarov, Counsel, and Daria Romashchenko, Associate. “The uniqueness of this dispute lies in that it can set a precedent for dozens of others. The holders of rights to phonograms and performances have two alternatives in addition to the CMO: to manage their rights either independently or through a representative. The courts of two instances have confirmed that the holders of rights to phonograms and performances may withdraw their rights from management of ULCRR. They may enter into an agreement directly with the users and receive a remuneration. By applying the new provision of the Commercial Procedural Code of Ukraine regarding the probability of evidence, the court has found that the fact of withdrawal of rights is proved as more probable than not,” said Ilarion Tomarov.  ### For more details please contact Olga Shevchenko, PR Manager Tel.: +380 67 358 47 82 E-mail: shevchenko@vkp.ua About the Firm Established in 1992, Vasil Kisil & Partners is a Ukrainian law firm that delivers integrated legal advice in banking & finance, mergers & acquisitions, capital markets, antitrust, competition and trade, dispute resolution, tax law, energy and natural resources law, intellectual property law, labor and employment law, real estate and construction law, as well as PPP, concessions and infrastructure law. Vasil Kisil & Partners is a member and exclusively represents Ukraine in such international professional associations as TerraLex (160 law firms in 100 countries), Cathay Associates (40 high-profile law firms with over 500 headcount worldwide in 43 major cities and countries across Europe and Asia) and Ius Laboris (1700 labor and employment lawyers in 50 countries). Andriy Stelmashchukis a managing partner of Vasil Kisil & Partners law firm.

Vasil Kisil & Partners’ team has successfully represented McDonald’s Ukraine in the case against Ukrainian League of Copyright and Related Rights (ULCRR).

ULCRR filed a lawsuit against McDonald’s, seeking remuneration for public performance of phonograms in the chain’s restaurants. ULCRR is the only accredited collective management organization (CMO) authorized to collect remuneration for this type of use of phonograms in Ukraine. The plaintiff contended that McDonald’s was obliged to enter into an agreement with the plaintiff, regardless of the actual circumstances of use. However, McDonald’s entered into remuneration agreements directly with the holders of related rights to phonograms and performances. The rights holders withdrew their rights from management of ULCRR, which is why the latter had no right to collect remuneration for their phonograms.

The courts of two instances dismissed the ULCRR’s lawsuit, and the Supreme Court refused to commence cassation proceeding. The courts found that ULCRR had no right to file such lawsuit. The law stipulates that in order to apply to a court for the protection of property rights ULCRR must obtain a power of attorney from the rights holders. The assessment of the right to file a lawsuit is essential for this category of disputes, and there are currently several dozens of them. 

The project was handled by the Intellectual Property team composed of Ilarion Tomarov, Counsel, and Daria Romashchenko, Associate.

“The uniqueness of this dispute lies in that it can set a precedent for dozens of others. The holders of rights to phonograms and performances have two alternatives in addition to the CMO: to manage their rights either independently or through a representative. The courts of two instances have confirmed that the holders of rights to phonograms and performances may withdraw their rights from management of ULCRR. They may enter into an agreement directly with the users and receive a remuneration. By applying the new provision of the Commercial Procedural Code of Ukraine regarding the probability of evidence, the court has found that the fact of withdrawal of rights is proved as more probable than not,” said Ilarion Tomarov

###

For more details please contact Olga Shevchenko, PR Manager
Tel.: +380 67 358 47 82

E-mail: shevchenko@vkp.ua

About the Firm

Established in 1992, Vasil Kisil & Partners is a Ukrainian law firm that delivers integrated legal advice in banking & finance, mergers & acquisitions, capital markets, antitrust, competition and trade, dispute resolution, tax law, energy and natural resources law, intellectual property law, labor and employment law, real estate and construction law, as well as PPP, concessions and infrastructure law. Vasil Kisil & Partners is a member and exclusively represents Ukraine in such international professional associations as TerraLex (160 law firms in 100 countries), Cathay Associates (40 high-profile law firms with over 500 headcount worldwide in 43 major cities and countries across Europe and Asia) and Ius Laboris (1700 labor and employment lawyers in 50 countries). Andriy Stelmashchukis a managing partner of Vasil Kisil & Partners law firm.

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