Is Your Cease and Desist Merely a Bluff?
Declaratory Judgements in Trademark Cases: How Your Cease and Desist Letters May Turn A Case
The use of cease and desist letters are common tools for intellectual property counsel to use to ward off potential infringers as well as to assert rights in particular trademarks. Some court holdings, however, have put cease and desist letters and their authors on notice by analyzing whether the language in the letters create a true justiciable controversy that allows for declaratory judgments in trademark cases.
Requesting Declaratory Judgments
Declaratory judgments are often requested by parties that receive the cease and desist letters so that they may continue to use their mark without fear of infringement and not have to worry about rebranding or registering and protecting an entirely new mark.
Recent decisions in trademark cases have raised issues about declaratory judgments as the latest holdings contrast with previous precedent set by other courts and also bring new focus to the specific wording of cease and desist letters. This is important, because companies and legal counsel must now be more careful about the exact content of the cease and desist letters in anticipation of the potential for declaratory judgement.
How A Cease & Desist Letter Language Can Affect Declaratory Judgement in TM Cases
In Winestore Holdings LLC v. Justin Vineyards & Winery LLC, the court recently held that sending a cease and desist letter to an adverse party was not enough to create a justiciable case or controversy if the letter does not contain specific language and firm demands even if it is followed up with a filing of a Notice of Opposition with the United States Trademark Office.
This recent ruling flies in the face of past rulings where courts have ruled that the mere sending of a cease and desist was enough to create a case or controversy even if the original party that sent the letter clarifies later that they have no intention to sue, see Classic Liquor Importers, Ltd. v. Spirits International, B.V.
Key Takeaways for Drafting C&D Letters Leading to Trademark Infringement Litigation
With the recent holding in Winestore v. Justin Vineyards, counsel must now consider whether courts will analyze how cease and desist letters are written in order to determine whether or not parties may ask for declaratory judgments. Thus, when writing a cease and desist letter, it is important to consider:
whether the letter includes firm demands;
whether the letter actually threatens litigation;
whether the letter includes references to other filings such as Notices of Opposition; and
whether the trademark owner is willing to negotiate or committed to litigation.
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