An entrepreneur or business leader may send a competitor a cease and desist letter for a number of reasons. The goal of these letters is generally two-fold: to get another business to stop an action and to gather information. The author of the letter will likely attempt to achieve these goals by including a demand and a request information.
Step 1: Make sure it is a cease and desist letter, not an order.
What’s the difference? A government agency or court puts together a cease and desist order. This action would require the recipient stop the activity addressed within the order and respond to the agency or court as directed within the correspondence. In contrast, anyone can write a cease and desist letter. A businessowner or entrepreneur, for example.
Cease and desist letters are a request, not an official order. However, it is still important to take the communication seriously as it can serve as a warning of future legal action.
Step 2: Determine the best response
It is wise not to ignore the letter. The person who sent it likely intended it to serve either as a warning of the potential for future legal action or it is truly an official order. Either can signal the potential for negative ramifications for your business. As such, it is wise to discuss with business leadership the best response.
If a cease and desist letter threatens further legal action, it must generally include specific allegations that are sufficient to constitute a violation. These letters are most often used to deter the continued use of intellectual property, actions that are deemed harassing, defamation of character and libelous actions. Review this information to help guide your response. It is also helpful to have an attorney review the letter to help determine if the author has any standing to support their allegations.