CEASE AND DESIST NOTICE ON IP INFRINGEMENTS
By Vaibhav Luthra July 26, 2016
A Cease and Desist letter, also known as infringement letter or demand letter is a document sent to an individual or a business to stop (halt) purportedly unlawful activity (“cease”) and not take it up again later(“desist”). The letter may warn that if the recipient by deadlines set in the letter does not cease and desist the specified conduct, or take actions, that party may be sued.
Sending of a cease and desist letter is regarded as an ancillary to the enforcement strategy to settle a dispute without resorting to litigation.
The intellectual property right holder such as a copyrighted work, a trademark, or a patent, may send the cease and desist letter to inform the third party of the rights, identity, and intentions to enforce the rights of the right holder or owner.
A trademark is a word, symbol or phrase, used to identify a particular manufacturer or seller’s products or services and to distinguish those products or services from other entities. For example, the Trademark “Nike”, along with the Nike “Swoosh,” identify the shoes make by Nike and distinguish them from shoes made by others.
A Patent prevents the unauthorized use by others of an inventor’s patented discovery. While “mere ideas” are not patentable. The patent is an exclusive right granted by a sovereign state to an inventor for a limited period of time in exchange of an invention.
It is a legal right created by the law of the country that grants the creator of original work exclusive rights for its use and distribution. This is usually only for a limited time. The exclusive rights are not absolute but limited by limitations and exceptions to copyright law, including fair use.
Cease and Desist letters components:
Misrepresentation and misuse of trademarks without lawful authorization from the IP owner is common in the trade. In view of this rising menace and timely prevention, trademark owner resorts to means of sending cease and desist letter to potential infringers, prior to approaching the court of law. Sending a cease and desist letter is ancillary enforcement strategy to settle a dispute without resorting to litigation.
The Cease and Desist letter outline the following:
- The business and trade mark portfolios of the IP holder;
- Information about the repute of the IP holder, he enjoys in its trademarks;
- The detail of impugned trade mark;
- The extent of misuse of the impugned trade mark by the infringer;
- Requisitions as required to be complied with by the infringer.
Prior to sending a cease and desist letter, it is recommended that the IP holder becomes fully aware of the extent of the misuse of its trademark by the infringer, and the details of such misuse keeping in mind the very important factor or the number of years of the use by the IP holder.
Benefits of sending a Cease & Desist Notice:
- The letter conveys to the infringer the notice of infringement.
- Beneficial in proving willful infringement and associated damages at the trial.
- It can encourage the infringer to cease the infringing business and eliminate improper competition in the market.
- It may also initiate licensing negotiations. If the license is negotiated the patent owner can benefit from royalty stream from the infringer.
The patent owner will decide whether to file a suit for infringement or not and he will also determine – “where the litigation will take place?”
Disadvantages of sending a Cease & Desist Notice:
If Cease and desist letter is not so carefully drafted, the infringer may file its own action for a declaratory judgement (DJ) for non-infringement.
Here, the infringer decides the place of litigation. There must be a definite and concrete dispute between the parties in order to file declaratory judgements.
The Patent Owner in order to avoid the Declaratory Judgement in response can send a very non – threatening letter.
An example of Cease & Desist Notice by a leading Case:
Mozilla issued a Cease and Desist notice to Gamma International for maliciously using its brand and reputation; the commercial spyware manufacturer Gamma International was engaged in unethical behavior by disguising and using its malware as Mozilla Firefox software. Mozilla sent a Cease and Desist letter demanding Gamma International to stop these illegal practices immediately. In the letter, it had written that Gamma International cannot abide a software company using its name to disguise online surveillance tools that are used by the Gamma customers to violate citizen’s Human Rights and online privacy. Gamma’s software is entirely separate, and only uses Mozilla’s brand and Trademarks to lie and mislead as one of its methods for avoiding detection and deletion.
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A comparison between the Indian Patents Act 1970 and U.K. Patent Act 1977.
In India Section 3 and section 4 defines the Inventions which are not patentable.
In UK’s act, the same is mentioned under the first chapter Patentable Invention from Subsections 2-5.