This week’s 5 head-spinning moments: Undead enforcers & other restaurant frights

Not all of the ghouls and evil spirits knocking on your door today are trick-or-treaters. A few flesh-eaters lurched back from the dead this week to rip a chunk from restaurants’ softer spots.  But the industry wasn’t without its own hockey mask and chainsaw, dispatching several traditions into warm graves in true Halloween style.

1. Music cops bare their fangs again

You can almost hear the chains clanking as adversaries thought to be resting in peace arise again to stagger restaurants’ way. Some 20 years after the industry took a serious bloodsucking from the groups that police music royalty payments, the dark spirits have returned, lawsuits in hand again. This week brought the head-spinning news that ASCAP sued nine restaurants in the New York City suburbs late this summer for each playing as many as five ASCAP-registered songs without buying the appropriate license.

It’s a flashback to the nightmarish days when representatives of ASCAP and BMI would sit in the bar of a restaurant that wasn’t paying the groups, noting what tunes were performed lived or played on the sound system. Sometimes the red flag was a song being aired as background on a TV show, or a tune played by the marching band at halftime of a broadcast football game.  In some instances, the establishment was paying the songwriter groups, but just not the right amount; the fee structures were more difficult to navigate than IRS deduction rules.

No matter: The places often found themselves being fined or sued.

Then the parties seemed to find a peaceful resolution, and the matter ceased being a chronic pain for the industry.

Turns out the haunting never stopped completely. An ASCAP representative told Newsday, a newspaper serving the recently targeted restaurants’ Long Island setting, that his group has consistently sued more than 100 music-playing establishments every year. But, he added, that number is likely to increase because ASCAP has to offset a decline in songwriter royalties from recorded-music sales, which have been plummeting.

2. R.I.P., standard restaurant orders

The frequency of customers asking for special orders has widened the eyes of even an avid accommodator like Panera Bread Co. CEO Ron Schaich was amazed to learn that “half our orders are now customized in some way,” as he recounted to investors this week.

One of the features noted widely in the coverage of Taco Bell’s new remote-ordering and payment app is the ability to customize orders.

The old notion of one size fits all, it appears, has been relegated to gallows nooses and high-end chefs who refuse to have their art compromised by personal preferences.

3. A stake in the heart of restaurant dignity

It was bound to happen. Sardar Biglari, the thirtysomething investor-turned-restaurant-chain-operator who recently bought the Maxim girlie magazine, combined his two interests at the opening this week of a Steak ‘n Shake family restaurant in Santa Monica, Calif.  What the chain called “Maxim girls” were on hand to have their photos taken with the unit’s first guests.

There were no reports that a Steak ‘n Shake would serve as the setting for a Maxim photo shoot.

4. Demonic possession

The big tech news in retailing this week was probably absorbed with interest by restaurant chains.  The Rite Aid and CVS drug store chains dropped Apple’s smartphone payment system because they intend to join one that’s under development, called CurrentC.  They point out that the anticipated merchants’ fees are likely to be lower, a point of distinction that will likely appeal to many restaurants, too.

Then CurrentC was visited by a very evil spirit. Parties that e-mailed the upstart with requests for regular updates and a timeline for a launch were informed that the company’s computer systems had been hacked. Even before the service processed payments on a wide scale, thieves had cracked the database and possibly swiped e-mail addresses, according to an alert that was sent to the interested parties.

A devilish PR challenge also befell the new landlord of Red Lobster this week. American Realty Capital Properties revealed that it had botched past financial statements and warned investors and that the information was no longer reliable. ARCP bought the real estate under Red Lobster units for $1.5 billion after the chain was sold to Golden Gate Capital Partners shortly beforehand for $2.1 billion.

5. Restaurant death lists

It’s routine for local media to delight the dressed-in-black set with lists of upcoming restaurant openings. This week, the fashion shifted to running rosters of the dead or near-dead. Foodie favorites like Zagat, The Daily Beast and Boston’s BostInno web site published rosters of once-packed places that had folded their last napkin in recent months. Washington, D.C.’s DCist website took the tack of looking at restaurants that have been converted into parking garages.

The various casualty lists included such onetime landmarks as Sans Souci in D.C., Mesa Grill and Union Square Café in New York City, and Hamersley’s Bistro in Boston.

The common death factor: Soaring costs, and rent in particular. Many of the establishments had 15 or 20-year leases that came up for renewal, and the increases demanded by their landlords were just too big to cover. Instead, many of the operators decided to search for new sites and let the old ones R.I.P.

May a landlord not be among the parties that visit your establishment tonight, asking for trick or treat. 


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