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Responding to an Intellectual Property Cease-and-Desist Letter

May 4, 2021 | Firm News

When you’re running a business, legal issues are the last thing you want to deal with. Unfortunately, sometimes they are unavoidable. Imagine getting a letter from an intellectual property owner (IP owner) that says your product infringes a patent, your trademark is too similar to a registered mark, or an image you thought you could use on your website is actually copyrighted by someone else. The letter demands that you pay a large sum to the IP owner and stop using the product, mark, or image immediately. What do you do? Here are three steps you can follow to protect your business when dealing with intellectual property cease-and-desist letters.

#1 Don’t Panic

This is key. The letter’s official letterhead, hostile tone, and harsh demands can undoubtedly be overwhelming, especially if you haven’t dealt with this before and it seems like your business hangs in the balance. You might have no idea what to do or even be tempted to fire back right away with your own defensive response. But do not panic. Take a breath. Realize that anything you might want to say to in response could actually harm your ability to defend your business in negotiations or a lawsuit. See step 3.

#2 Don’t Ignore It

Ignoring the letter or putting it off won’t make it go away. In fact, it is one of the worst things you can do. Doing so will likely signal to the IP owner that a lawsuit is the only way to resolve the matter and, once the lawsuit is initiated, it can be much more difficult and costly to resolve than it otherwise would have been. Doing nothing is not the answer, and it may make things worse. Realize that ignoring the letter puts you at greater risk for a lawsuit and possibly enhanced damages. See step 3.

#3 Call Your Lawyer

Calling your legal counsel should be the very first thing you do when you receive a cease-and-desist letter. Your counsel will be able to go over the letter’s accusations with you, thoroughly evaluate your options, develop a strategy, and work with you to respond in a way that best serves your business. But developing a plan doesn’t end with just calling your legal counsel. It is important to be open with your counsel about business information that may inform a response strategy, including when you started selling the product or using the mark or image; any associated revenues or related agreements; past dealings or communications with the IP owner; and any intellectual property you own that might give you some leverage in negotiations or a lawsuit. Any details like this you provide will only help your counsel formulate an appropriate response strategy, so you can focus on running your business again.

Adam Szymanski is a patent attorney and litigator whose practice focuses on intellectual property disputes, including patent and trademark infringement, trade dress enforcement, false advertising cases, and contract disputes. He helps entrepreneurs and companies of all sizes overcome legal challenges with strategies that fit their business objectives.

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