Written by William Miles | June 3, 2020
As intellectual property experts, we spend much of our time sending or responding to cease and desist letters. These letters are the first step in intellectual property (IP) claims and they set out the aggrieved party’s rights along with the various “remedies” they seek.
If you’re the recipient of a cease and desist letter in the UK and you’re wondering how to respond, or if you want to issue a letter, this post is for you. Read on to discover everything you need to consider.
A cease and desist letter is a document sent from one party to another. In the document, the sender requests that the recipient stop a particular activity, usually because the sender believes that it infringes upon their rights. Cease and desist letters effectively serve as a warning that the sender intends to launch further legal proceedings if the activity does not stop, as a result, a letter such as this can be referred to as a ‘letter of claim’ or a ‘letter before action’.
Typically, in the context of intellectual property, the scenario is as follows:
A legal, pre-action conduct Protocol provides specific guidance on what the court expects a cease and desist letter to include. The letter should state the exact legal rights that Party A claims to own along with sufficient evidence of those rights. Registered intellectual property rights like trade marks and patents are easy to prove – they come with certificates and are accessible on public registries. However, unregistered claims like copyright infringement or passing off require more work. For example, Party A might need to explain who authored the work, who the current owner is (if different from the author) and why the IP rights subsist. This typically requires supporting evidence, even at this early stage.
The letter should also set out the remedies that Party A is seeking. Usually, there is a demand to stop infringing activities (the main aim), destroy any remaining stock or infringing materials, provide written undertakings preventing any future infringement, pay financial damages, and pay legal costs.
Yes, you will most likely need to respond to a cease and desist letter. Assuming the letter covers the above, there is a case to answer. In fact, the same Protocol that defines what a letter should include also notes that the recipient should respond in a reasonable time.
The response must confirm which parts of the claim are accepted or denied – the aim being that the parties can then work to narrow the issues and get a resolution underway (in one shape or another). The Protocol also warns that parties can be subject to sanctions from the court for a failure to comply, so you must not ignore the letter.
However, if you are unlucky enough to receive a cease and desist letter, don’t panic. Businesses and individuals send letters like this every day. Just because one party thinks their rights are infringed, doesn’t necessarily mean they’re correct.
There may well be scope to defend the claim, so you should seek expert legal advice before responding. A defence to an intellectual property infringement claim can involve two parts, although only one is actually needed in order to be successful:
You can probably guess what we’re going to say here but yes, taking legal advice is absolutely essential when defending a claim.
Legal issues and, in particular, intellectual property issues are complex and not something that most people deal with on a regular basis. As a result, it’s easy to misunderstand the relevant legal arguments, overlook key points or inadvertently give away critical information.
However, the legal advice you take needs to be proportionate to the claim being made so you should be careful not to overspend in this area. This is why it’s particularly useful to instruct a law firm, like Briffa, which can provide advice on a fixed fee basis.
For more information on how Briffa can help, please have a look at our Intellectual Property Disputes page.
In our social media-savvy world it is now more common than ever before for IP disputes to enter a public forum. A small business may consider this an effective strategy to gain sympathy or engage customers in discussion. You may believe that going public may pressure your opponent into dropping the matter. While social media has a place, it should be used wisely. Publishing your dispute does not necessarily make achieving a commercial solution easier. It can depend on the strength of your case. If you are not on good ground it can make things a lot worse.
If you go down the social media route then how and what you publish is also important. There is a big difference between simply publishing what you have received and saying you are doing all you can to fight it, to publishing your opinion on the big brand, its business and all it stands for.
The most important thing before you go down the publicity route is to decide what you want to achieve. Your response to the claimant and your use of publicity must be geared to achieving your desired business result. Remember, your customers are not necessarily as interested in your disputes as you are. Going public has no guarantee of being a positive move for your business, so be careful to ensure your good work and reputation don’t get bogged down in prolonged and complex public fight with another business.
When defending IP action, the first step is to work out precisely what the allegations are. More specifically, the intellectual property rights in dispute and how they are being infringed.
It’s vital to view the claimant’s rights with a critical eye. For example, a registered trade mark could be cancelled if it has been registered for more than five years and is not in use. Or a registered design can be removed from the register altogether if it isn’t sufficiently novel.
When it comes to unregistered rights like copyright, it’s crucial to ensure that the person or entity who instructed the letter actually owns the rights in the first place. Frequently the author of a particular work is not the party claiming infringement, and sometimes parties fail to put in place correct legal assignments to transfer the rights. So don’t be afraid to ask for more information, particularly if your opponent seems reluctant to provide it.
If the rights in question are valid, the next issue to assess is the infringement itself. Intellectual property rights each have tests for infringement, and the correct test must be applied appropriately. For example, the infringement of unregistered designs requires an act of copying, whereas the infringement of a registered design does not. Also, trade marks can prevent confusingly similar marks from being used in relation to similar goods/services, however, are the marks in issue sufficiently similar and are considerations such as the relevant consumer and their level of attention taken into account? Conversely, copyright can only stop the reproduction of the whole or a substantial part of an original work and so it’s vital to draw a distinction between copying and inspiration.
Once you know how much weight the allegations against you carry, and have sought some legal advice on the same, then it’s time to talk strategy.
Strategy plays a big part in intellectual property infringement issues and can make or break resolutions. The next step is to consider any specific defences, such as prior use for patent infringement or fair dealing for copyright infringement.
And, of course, there are broader considerations beyond the law. For example, what is the commercial reality of the infringement? Have large numbers of goods been sold or is this a small product line? How much stock remains? Who is currently selling it? What are the potential PR impacts of a dispute? And what is Party A asking for, damages, costs or just a removal of certain goods from sale?
Finally, consideration toward settlement should be given. It could be that there is a simple fix that doesn’t need the court’s time to adjudicate or that a party is willing to concede parts of their position to resolve the issue.
All of this should form your defence strategy, which will determine how you respond and the next steps.
Last but not least, we need to consider timing. Cease and desist letters often have short response deadlines. It’s essential to ensure that your legal advisors have enough time to take your instructions and prepare a robust response. So, act swiftly if you receive a letter – failing to reply could lead to court proceedings and, potentially, an adverse judgment.
If you think you need to send a cease and desist letter to protect your intellectual property rights, then the first thing to do is establish what unlawful acts have taken place.
Intellectual property consists of several different rights, so it’s important to clarify which particular rights the potential defendant is infringing. For example, someone copying a company’s logo may infringe on a trademark (if it’s registered) and a copyright work. Therefore, the logo itself could be under the protection of two different IP rights, each with different tests for infringement. A copyright, design right, or trademark cease and desist letter must explain which rights are relied on and how they have been infringed.
Once an unlawful act has been established, the letter then needs to address the remedies. In short, what do you want?
The main priority is to end the sale or supply of the infringing items and remove any relevant listings. But although this is important, it doesn’t fully address the issue. Instead, you should address the damage caused. The sales may have been going on for some time, so you should ask for disclosure from the infringer about their activities. The infringer should provide this disclosure along with supporting evidence. It’s a good idea to have the disclosure set out as part of a witness statement, signed with a statement of truth. It would be naïve to suggest that this guarantees complete honesty, but it’s a good place to start.
Once the extent of the damage is known, you can assess the size of your financial compensation either by way of damages (i.e. the impact on, or devaluation of, your reputation) or an account of profits (i.e. a sum equivalent to the profits made by the infringer).
It’s also common to ask the infringer to pay your legal costs and sign a set of “undertakings” preventing them from infringing your rights in the future (although this tends to be a point of contention).
Whilst anyone can write a cease and desist letter if they wish, given the legal complexity and importance of presenting your case well, it’s vital to engage the services of a solicitor. Although simple enough in principle, it still requires careful legal drafting. At the very least, you should first seek legal advice to understand if another party is infringing your rights and if you have grounds for a complaint.
The cost of a cease and desist letter varies between law firms, but the price is typically between £500 and £1,000. Some firms charge per hour whilst others, like ourselves, offer fixed fee quotes.
Learn more about sending a cease and desist letter in our next post: Considerations for Crafting A Cease and Desist Letter
So there you go, a whistle-stop tour through the primary considerations of a cease and desist letter. However, the take-home point is that should you receive such a letter, seek legal advice. Investing in the right advice from the outset can often shorten the length of any dispute and significantly reduce your exposure. We aim to always find the most cost-effective solution for you without damaging your business or sacrificing what you’ve built.
Our team is on hand to help you through this process, so please get in touch to arrange a free consultation if you need help.
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