The McDonald’s office in Ukraine won litigation with the Ukrainian League of Copyright and Related Rights (ULCRR) in a dispute over payment for the public use of phonograms.

ULCRR, as the only accredited collective management organization (CMO), which is authorized to collect remuneration for the public reproduction of phonograms in Ukraine, filed a lawsuit against McDonald’s Ukraine in order to collect payment for the reproduction of phonograms in the restaurants of the chain.

ULCRR insisted that McDonald’s Ukraine was obliged to conclude an agreement with it and to deduct a fee for the use of music.

However, McDonald’s entered into agreements for the payment of remuneration directly with the right holders of related rights to phonograms and performances. The copyright holders withdrew the rights to manage ULCRR, so the plaintiff had no right to collect rewards for their phonograms.

The courts of first and appellate instances rejected ULCRR ‘s claim, and the Supreme Court refused to open cassation proceedings. The courts found that the League has no right to file such a claim, since, in order to go to court for the protection of property rights, ULCRR must obtain a power of attorney from the copyright holders.

Thus, it was established that the user can conclude an agreement on the use of copyright and related rights both with the CMO and directly with the copyright holder. And rights holders can, at their own choice, dispose of their rights both independently and through the CMO, or withdraw rights from the management of the CMO.