Lawyers love and hate cease-and-desist letters. Startup owners cower when they receive one. A cease-and-desist letter is one in which a very official-looking letterhead demands that you stop selling a product, using a name or logo, or to cease operations entirely. There are ways to avoid getting crushed by these letters; the first way is to recognize that, as official as they sound, they have no actual legal effect in and of themselves. The letters are just an easy and relatively cost-free way to scare people, and they do!
When it comes to demand letters, an ounce of prevention is a pound of cure. An hour-long consultation with an attorney prior to launching your business can guide you towards building armor against what is too often a legal shakedown. In the meantime, here are some things you can do before establishing your business:
- Do a search of the Patent and Trademark Office's database of registrations of established trademarks and trade dress and be honest with yourself as to the similarity of your proposed name, logo, or product design.
- Do a Whois search of similar domain names to the one you want. While a domain name's similarity to yours isn't necessarily cause for concern, your search and subsequent Internet exploration may lead you to identify potential causes of conflict.
- Register every trademark, name, and unique element related to your business as soon as you are ready to enter the marketplace.
- Register every original work with US Copyright Office.
However, sometimes you are well underway with your business, and you receive that C&D letter that you just didn't anticipate. First, take a deep breath. This is an opening salvo, and your potential adversary may not be after everything that is demanded. Second, do not immediately respond. It would be wise to discuss all of the possible issues with an attorney, and a response letter from an attorney is usually a much more powerful way to try to innoculate yourself. In fact, you may find that you have potential causes of action against the very people who are trying to intimidate you, and you may find a reason to demand compensation!
For your entertainment, here are a couple of outstanding responses to cease-and-desist Letters, published by the AboveTheLaw website, to show you how lawyers like to fight fire with fire: