You have received a cease and desist letter, now what should you do?
A cease and desist letter is a communication that has two purposes:
- It demands you cease or stop doing something that the author claims only he, she, or it has the right to do. You may also be asked to make reparation.
- It is the first warning shot in a potential lawsuit.
The letter looks extremely intimidating, what with all the legal language about laws and court opinions that are supposed to uphold the author’s claim. It is meant to scare you into compliance rather than risk litigation.
However, a cease and desist letter is not legally binding. It is merely the opinion of one attorney who is representing a person or company that feels harmed by your actions. While attorneys are sworn to tell the truth and refrain from making false claims, there is nothing stopping them from having a bad or wrong opinion.
The letter does not guarantee a lawsuit, either. It may say a suit is imminent, and the author may have plans for a suit, but it doesn't mean it will happen.
So what should you do?
Keep Calm and Consider Compliance
First, do no harm to yourself by taking rash actions. In particular, do not respond to the letter yourself and do not publish it or mention it on social media. Anything you post and any response you make is admissible if the case does go to court.
Take time to understand fully what the letter says. Is it possible to comply with the cease and desist demand without damaging your business operations? If so, that may be your best course of action. At the least, if the problem is a potential trademark or copyright infringement, refrain from using the property in marketing and online until the issue is resolved.
Preserve all the evidence. This is not the time to delete files or email. Print everything out and gather the evidence into a file in case you are sued. Absolutely do not ignore or throw away the letter.
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Consult an Attorney
The reason you should not respond directly to the cease and desist letter yourself is that it can be brought into court. Even if your decision is to comply with the demand, a lawyer can help you with your response. You must respond in order to keep the situation from escalating but if your attorney drafts and sends the letter it can be considered “settlement negotiations,” which are not admissible in court.
A letter directly from you, on the other hand, can be considered "party-opponent admission" and is excluded from the hearsay rules under the federal rule of evidence. Therefore, it can be used against you in court.
An attorney can also help you follow any special procedures detailed in the letter. For example, it may be a copyright violation notice for something on your website or your social media account. You will need to remove the offending material.
A lawyer experienced in business and patent law may give you a better chance of avoiding litigation and reducing the cost of a settlement.
Check Your Patents
Just because you receive a cease and desist letter doesn’t mean you are doing anything wrong. Sometimes an individual will accuse you of legal harm when there is none, either mistakenly or with intent.
Once you and your attorney have looked over the letter, check your own patents to make sure the problem isn’t on the side of the letter’s author. If you have a patent to protect the piece of intellectual property or physical property brought into question, you may be entitled to a claim of your own.
Still, do not rush off and try to handle this yourself. Work through your lawyer to effect client-attorney privilege and to work toward a positive outcome.
Respond to the Cease and Desist Letter
As mentioned above, you must respond to the cease and desist letter; you cannot ignore it or throw it away. Whether or not you think the claim is correct, you and your attorney must make the next move quickly to keep the issue from becoming a nightmare.
In the event you determine you are infringing on another person’s rights, you may need legal advice on proceeding with compliance. You may need to negotiate a delay in compliance because you have a lot of money tied up in merchandise with the offending trademark on it. You need time to dispose of it or to alter it for sale.
If the trademark is for a service, you will need time to rebrand and start marketing your new name. A lawyer can help you strike a balance, so you don't go bankrupt.
Receiving a cease and desist letter is no fun, but an emotional response is counter-indicated. You must respond but do not do so without the counsel of an attorney. Comply if appropriate, check your patents to ensure the claim is correct, and send all communication through your attorney until you have resolved the case.