Yesterday, I noted a news story about a bar that stopped hosting live music when it was hit with a lawsuit by BMI because it had not paid royalties for its use of music. The issue of music in bars and restaurants also came up in a continuing legal education seminar on music licensing that I moderated the week before last. Given that I have not written on this topic in some time, I thought that it was worth a reminder that retail outlets, including bars and restaurants, have to pay music royalties to ASCAP, BMI, SESAC and perhaps GMR for the performance of music in their venues, except if they fit within very detailed exceptions that allow for certain businesses to avoid those payments.
We wrote an article here that goes into detail on the exceptions. Basically, for very small businesses, their employees can use a single device of the type used in a home to play music. This exception was designed to allow businesses to allow their employees to have personal audio devices to entertain themselves. So that portable radio on the counter of the dry cleaner or at the secretary’s desk can play music without paying royalties. For larger businesses there is a different exception that allows them to avoid liability but only if they meet very specific rules.