A recent UK case has again illustrated the importance of ensuring that ‘cease and desist’ letters (C & D letters) are carefully drafted. These letters have long been an effective weapon against trade mark infringement and can often prove to be a quick and effective method of protecting a trade mark.

Legislation in Ireland and the UK protects individuals and businesses against groundless threats of infringement proceedings by the owners of registered trade marks. For example, a groundless threat will occur where a person has been threatened with trade mark infringement proceedings even though, for whatever reason, there has been no such infringement. The courts can grant a number of reliefs to someone who has been the victim of a groundless threat, including:

• A declaration that the threats are unjustified
• An injunction against the continuance of threats
• Damages in respect if any loss sustained by the threats

Although it has rarely been invoked by the courts, the potential award of damages could be extremely significant, especially in situations where the threats have been made public and the victim suffers a drop in sales due to the negative publicity.

The UK High Court in Best Buy Co Inc v Worldwide Sales recently examined a letter sent by the Spanish defendant to the US based plaintiff stating that their trade mark application infringed on the defendant’s existing registered trade marks and that if the application was not withdrawn they would be “entitled to take the appropriate legal action to defend their interests”

The High Court held that, in these circumstances, the letter was merely a negotiating response to the plaintiff’s earlier proposal of a co-existence agreement and, as such, attracted the protection of ‘without prejudice’ status, even though this did not appear in the letter. However, it is implied in the judgment that had this threat been sent in the form of a C & D letter as opposed to during the course of negotiations between the parties then the result of the decision may have been entirely different.

There has been very little discussion of this issue by the Irish courts, however it has been consistently held in the UK that a pragmatic view as to what constitutes a threat should be taken. Therefore, veiled or implied threats will also fall under this legislation and it is vital to ensure that specialist advice is obtained prior to making any communication whether orally or in writing.

For further information or if you have any queries please contact  David Cullen or Leo Moore of our IP department