You are the receiving party to a cease and desist. The letter demands you refrain from certain actions now or in the future by a specific deadline. What do you do? On the other hand, you might be the party whose rights have been infringed upon and are seeking compensation. You send a cease and desist to the other party, but have not received a response. What can you do?
If you are the receiving party to a cease and desist you will likely feel overwhelmed and intimidated, especially if you had no idea that you infringed upon someone else’s rights or if they are well-known. You might be the “little fish in a big pond” and want to resolve the situation, but are unsure where to begin.
In contrast, you might be a luxury brand in which another party is using your intellectual property without your permission for its sole benefit. They might even be an IP troll. They have infringed upon your intellectual property, stolen trade secrets, passed off your goods as their own, or manufactured counterfeit products. As a reputable brand that has built goodwill with its customers over many years, your reputation has now been tarnished by this other party.
Assistance of Counsel
Having been on both ends of the spectrum, I understand each clients’ concerns. The first step in either of these scenarios is to seek the assistance of counsel. If you are the receiving party to a cease and desist, or if you are the owner seeking to protect your rights, a lawyer will be able to advise on strategies to enforce your rights or defenses. The worst thing you can do is to ignore these letters. Regardless of how frivolous or vexatious a cease and desist might be, a party should always respond.
Oftentimes, I have come across cease and desist letters that were either too aggressive or lax in their approaches. The issue is that some lawyers may not truly grasp their clients’ businesses. They have a general understanding but do not have the overall picture or goals in mind. When drafting cease and desists, they require a certain balance.
The first step in any lawyer-client relationship is to develop a level of open communication. The lawyer should always ask early on for details regarding the client’s business and what they wish to achieve. This includes inquiring about the client’s business model, relationships with third parties, budgets and finances, marketing strategies, and plans to expand. The lawyer should act as if they were in-house counsel for that client. Lawyers must have an understanding of the business as if it were their own.
Protection & Enforcement
Once the business needs and goals have been established, a lawyer can proceed to protecting and enforcing their client’s rights. A cease and desist is the first step any party can take to enforce those rights. Cease and desists are warning letters informing other parties that they have infringed upon certain rights and demanding they stop their actions immediately. If the other party does not comply with the demands contained in the letter, the rights owner may proceed with further legal action.
Best Practices in Drafting
Cease and desists vary with each client and should be drafted carefully. Sometimes it might be in the client’s interests to be vigilant and other times a lawyer might err on the side of a “friendly reminder” when the client has a good business relationship with that other party. There is a delicate balance between aggressive and lax approaches when it comes to drafting the appropriate cease and desist. This not only affects the client’s reputation but also affects the lawyer’s as well. A lawyer should assume that each letter they write will be read by a judge or published by the recipient via the Internet.
On the one hand, a client wants to enforce its rights and ensure they have control over their intellectual property and how it is being used. Yet, clients also want to maintain good business relationships. This typically comes into play if you license your intellectual property to third parties. You have established reputable business relationships with those third parties but want to “remind” them of their obligations under the contract.
On the other hand, a client may have prior rights or a stronger argument than the party claiming to be the rights owner. This is where the law becomes grey and each situation is determined by the facts of the case. One must not automatically assume that the rights owner is entitled to certain rights or protections, or rely upon unfounded or baseless claims.
When it comes to blatant infringement and IP trolls, it might be in the rights owners’ best interests to tailor their cease and desists to be more vigilant by including specific demands to be met by a particular deadline. This includes anything from monetary compensation, destroying the infringing or counterfeit goods, demanding an accounting or returning such goods to the rightful owner.
Each situation is unique and determined on a case-by-case basis. Drafting and preparing cease and desists are not without risk and should take into consideration its audiences. For more information on cease and desist letters, or in enforcing or defending your rights, Ranieri Law provides complimentary initial consultations to better assess your needs.
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