Coping with a Cease and Desist Letter

April 2013
by Steve Gillen

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It comes in a FedEx envelope, or by U.S. Mail, marked certified, return receipt, or by Express Mail in a blue-and-white cardboard mailer, as much for impact as for evidence of receipt. The return address is clearly that of a law firm. Maybe it’s a letter about your surprise inheritance from some long-forgotten relative. But more likely, it starts out . . .

Dear [Your Name]:

This firm and I represent XXX. Our client advises us that it has reason to believe that your company . . .

And it’s all downhill from there, as you can see from the hypothetical sample letter below.

Steps to Take

Reach out to your publishing/media lawyer quickly if you already have one. The demand letter will probably instruct you to respond by a specified date, anywhere from a few days to a few weeks from the date of the letter. Don’t wait until the deadline to contact your lawyer. Call or email as soon as you reasonably can, and be prepared to start by telling your lawyer who the opposing party is.

The lawyer needs to know this before hearing about the claim or reviewing the letter and advising you, to be sure that the opposing party is not also a client. Of course, if your lawyer is in a solo practice, a client conflict may be unlikely, but some firms have hundreds of lawyers and multiple offices, and a conflict check at one of them can take a day or several days to complete.

Only after the conflict check is completed will your lawyer be able to review the demand letter and advise you.

If you don’t already have a lawyer experienced in copyright, trademark, libel, privacy, publicity, and/or advertising claims, and you want to take a shot at resolving the issue without engaging such a lawyer, there are certain steps you should take, and you should take them in a certain order.

1. Contact your insurance carrier. Put the carrier on notice of the demand, whether or not you think there is anything to it. Sometimes it takes a while for the facts to be fully developed. Your first instinct may not be right, and you don’t want to risk compromising your insurance coverage by failing to report the demand in a timely manner.

For some claims the “advertising injury” provision of your Comprehensive General Liability (CGL) policy may provide coverage or entail an obligation to defend. Don’t be dismayed by the description of this provision; the coverage it provides is much broader than it sounds.

Other claims may require a more specialized policy, which may be called “media perils,” “errors and omissions,” “cyber-risk,” “cyber-liability,” or “professional liability” policy.

2. If the claim relates to content supplied by an author, a freelancer, or some other content provider, notify that person of the claim as well.

Your contract with the person or vendor who contributed the content complained of should contain a section of representations and warranties coupled with a commitment to indemnify you for any claim resulting from a breach of those promises. And the contract probably requires you to provide that person or vendor with notice of any claim as a condition to their indemnification obligation.

But you should notify them even if the contract doesn’t expressly require notification. You will need the person’s or vendor’s assistance in responding to, defending against, or settling the claim, and they can’t help you if they don’t know about it.

3. Write a short letter or email acknowledging receipt of the cease and desist letter saying that you are undertaking a preliminary investigation and evaluation of the allegations and claims asserted in the letter and will respond substantively as soon as you have completed your investigation.

Comedian Ron White says about his first arrest that he had the right to remain silent . . . but not the ability. Do not follow his lead. The less said in this initial letter or email, the better. See the hypothetical sample response below, and send your response by courier or by some other means that provides you with a record of its receipt.

The Questions Worth Asking

Even though your first response should be brief, it might ask for additional information about the asserted claims if the information in the demand letter is incomplete.

For example:

● If the allegation is that some content in one of your books or on your Web site infringes somebody’s copyrighted work, ask for a copy of the copyright registration certificate for the allegedly copied work; and, if that work is not a readily identifiable, published work, ask also to see a copy of the identifying material that was deposited with the Copyright Office and the original application for registration.

A work does not have to have been registered to get copyright protection, but whether it was timely registered and how and in what form it was registered will have an important impact on the strength of your accuser’s claims and the remedies available to a successful accuser.

● If the allegation is infringement of another party’s trademark or trade dress, ask to see a copy of any trademark registration for the mark alleged to have been infringed. Again, a mark does not have to have been registered to have protection as a trademark, but whether it is the subject of a valid and subsisting registration will have an impact on your accuser’s case.

● If the claim alleges libel and the demand letter does not specifically identify and quote all statements alleged to be libelous, ask the lawyer to provide that information and to specify exactly what about each statement is alleged to be false.

In each case, the additional information will help you investigate and evaluate the claim and facilitate a speedier resolution.

Don’t Bite on the Bait

No matter how overreaching or rude the tone of the demand, resist the temptation to be anything other than perfectly polite and respectful. If you respond defiantly or sarcastically, you can bet that your response will be promptly posted on a Website or in a blog for all to see, and the digital attention you are likely to attract will probably be unwelcome. A viral public reaction can be every bit as devastating as a final judgment on the merits, and your insurance policy may not cover the consequences of adverse publicity.

(For a vivid example of the dangers, read about what happened to the publisher of Cooks Source magazine in “Fair Use and Other Aspects of Coping with Copyright Law” in the June 2011 issue of the Independent.)

Ignore Most of the Demands Most of the Time, at Least Initially

The demand letter will probably ask you to do a series of things by a certain specified date: to freeze inventory, suspend sales, or remove content from your Website; to provide an accounting of all sales or distribution; to provide a list and contact information for all customers who bought or received a copy of the accused work; to post an apology and a link to the accuser’s site; and so on.

In the unlikely event that liability is clear and potential damages are substantial, immediate compliance is the best path to resolution. But in most cases, it is better not to comply with or respond to those demands until after you have completed your investigation and, as necessary, secured the advice of competent counsel.

If the demand concerns an allegation of libel, the letter may insist upon a retraction. Your First Amendment rights allow you to disregard this demand, but you may want to consider complying with the retraction demand even though you don’t have to, because state law in the applicable jurisdiction may provide some immunity from certain kinds of damages if the retraction statute applies to your particular publication, if the demand was made in the proper form, and if the retraction you publish conforms to the statutory requirements, which will likely include the time and manner in which it must be published. All this can be complex and nuanced, so you would be wise to get legal advice before deciding how to proceed.

Be Careful Out There

If you can make the claim (whatever it might be) go away without the active involvement of your insurance carrier and your lawyer, more power to you. If, despite your initial efforts, it won’t go away early and a substantive response is required, it is probably best to involve a lawyer. Certainly, if a cash settlement is involved, you would be courting disaster to pay for a release without advice of counsel.

At this point, should you get to it, it is likely that your insurance coverage will provide some support. Just be careful what you say, be more careful about what you write, and when in doubt, be silent.

A Sample Cease and Desist Letter

(based on invented facts and parties and provided only for illustration)

Cain, Abel & Associates, LLP
2200 PNC Center
84 Fifth Avenue
New York, NY 10110

March __, 2013

Via Certified Mail, Return Receipt Requested

Mary Miller, Publisher

Valiant Publishing, LLC

13925 61st Avenue N.

Bloomington, IL 61701

Re: Copyright Infringement of Half Dome Photograph

Dear Ms. Miller:

This firm and the undersigned represent the Ansel Trust, repository of the intellectual property rights of the late Adam Ansel (“Ansel Trust”), in the enforcement of its intellectual property rights and in particular the enforcement of those rights associated with the photographs of Adam Ansel. In that connection, our client has advised us that in June of 2010 it entered a license agreement with Valiant Publishing for the reproduction of Ansel’s copyrighted photograph of Half Dome as a half-page internal illustration in the printed edition only of a book published by Valiant under the title Fiscal Cliff, From Above and Below, by John Public.

As you know from the terms of the license agreement, the photograph at issue is the copyrighted property of the Ansel Estate.

Our client has informed us that, notwithstanding the limited rights granted under the license agreement, Valiant has used the subject photograph on the cover of its book, on an e-book edition of same, and in advertising for the book on the Valiant Website at www.valiantpublishing.com and on the Amazon Website. Valiant’s use of the photograph in this manner is outside the scope of the license agreement and constitutes infringement of our client’s copyrights. The remedies for copyright infringement include: i) an order from a U S District Court instructing you to cease your infringing conduct and seizing for destruction all infringing copies and associated reproductive materials; ii) recovery of our client’s attorney fees and costs incurred in connection with the enforcement of its rights; iii) recovery of our client’s damages together with any profits made by you from the infringing conduct; or, at our client’s election, statutory damages of up to $150,000. 17 U.S.C.§§ 502, 503, 504, 505.

Of course, if there is an innocent explanation, we are most interested and anxious to hear it, and we ask that you provide it promptly. If not, we hereby demand on behalf of our client that you:

● immediately cease and desist distribution of the infringing book and that you further provide verification in writing within ten days of the date of this letter that such activity has ceased;

● provide us, within fourteen days of the date of this letter, with an accounting for all sales of copies of the subject book, in printed and e-book form;

● provide, within fourteen days of the date of this letter, a written inventory showing the count and location of all copies and associated reproductive materials (digital and print) and set those materials aside for inspection and eventual destruction;

● disclose, within fourteen days of the date of this letter, any other uses, electronic or print, you have made of our client’s work (and if there have been none, provide a written certification to that effect);

● provide, within fourteen days of the date of this letter, an accounting of the date the infringing work was first incorporated in your Website together with an accounting of any revenues (from advertising or other sources) or other benefits derived from the operation of your Website (other than direct book sales), together with an explanation of how those fees or benefits are set or determined;

● provide, within fourteen days of the date of this letter, a list of any known links to the Web page on which the infringing book appears; and,

● agree to cooperate in an independent audit of your books and records for the period in question (destruction of relevant evidence is a separately punishable offense).

We ask that you acknowledge receipt of this letter promptly and that you ask your counsel to contact us within ten days of its date so that we may be apprised of your intentions and avoid an unnecessary escalation. If we do not have your prompt cooperation with the foregoing demand, we have been authorized to serve a takedown demand on your firm’s Internet service provider. (Courtesy copy enclosed.)

Sincerely,

Abel, Cain & Associates, LLP

Samuel Abel

SA/plg

Enclosure

cc: Mr. Don Ansel, Trustee, Ansel Trust

A Sample Response

(based on invented facts and parties and provided only for illustration)

Valiant Publishing, LLC
13925 61st Avenue N.
Bloomington, IL 61701

March __, 2013

Via Certified Mail, Return Receipt Requested

Samuel Abel, Esq.

Abel, Cain & Associates, LLP

84 Fifth Avenue

New York, NY 10110

Re: Adam Ansel Half Dome Photograph and Your Letter of March __, 2013

Dear Mr. Abel:

We are in receipt of your letter, referenced above.

Valiant Publishing is a respected publisher of books on social and political topics of public interest. We are vigilant about our own intellectual property rights and mindful of our obligation to respect the rights of others.

We have initiated an investigation and evaluation of the claims asserted in your letter and will respond substantively as soon as we are able to complete that process. In the interim, it would assist us in our evaluation of your claims if you would provide us with a copy of the certificate of copyright registration covering the photograph at issue together with a copy of the identifying material deposited with the application if the registration is for an unpublished work.

Sincerely,

Mary Miller, Publisher


Steve Gillen is a lawyer and partner in the intellectual property firm of Wood Herron & Evans and has focused his practice on publishing and media matters for 30 years. He is a member of IBPA and a frequent contributor to the Independent.

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