What should you do if you receive a letter of demand?
What I’m talking about today is what you should do if you receive a letter of demand. If your letter of demand relates to infringing Getty Images copyright, I’ve done a whole course on that, a free course with an eight-step process and strategy, so jump on to that course. If you don’t know where it is or how to find it, message me and I will send you the details of that. Other types of letters of demand, of course depend on what the situation is. If somebody says you haven’t paid and you’ve got an agreement to pay, the easiest thing to do, is just pay them.
If there’s a dispute about quality or that you didn’t get what you thought you were getting, the basic thing to do is to try and discuss it with the provider, talk to them, negotiate, maybe negotiate a lower payment. If you’ve got a letter of demand relating to intellectual property, that could be a little bit more serious and in that situation, you may need to decide whether or not you want to keep using the disputed intellectual property or stop using it. If you decide you want to stop using it, and just get out of the situation, never ever apologize.
Once you apologize, then that could be taken as an admission that you’ve infringed. So my mom recently got involved in a fender bender. Somebody questioned her, she got such a fright, she got out and she said, “I’m sorry, Is everybody okay?” That could be used against her, “I’m sorry,” could be taken that she’s admitting that she caused the accident. It’s human nature to apologize, but don’t. What you want to do is focus on the solution, the solution is if you agree not to sue me, I will agree not to use this piece of intellectual property. I’m not agreeing that I wasn’t allowed to use it and I’m not agreeing that it was an infringement.
Now if you’re dealing with Getty Images, they will still expect you to make some kind of payment for the image that you used, and probably in the hundreds of dollars. So sometimes, even if you agree to stop the alleged infringing action, you don’t always escape a financial consequence. But other than the Getty Image example, in most situations if you agree to stop, you will be able to not have to pay any money. So for example if somebody says you’re infringing their trademark, very often all they want is for you to stop infringing and they will let it go. But understand that the longer a case drags on, the more likely you are to be liable.
I recently settled a case for a client of mine, her trademark had been infringed by a multinational company, an American company, and in the end they agreed, we didn’t take it to court, we negotiated but they agreed to pay $65,000 in a settlement. So you can’t always get away with not paying anything, talk about it and see if you can settle. The second thing is never ever ignore a letter of demand.
I had a client recently who was away overseas, she received a letter of demand, then she received court documents, then she was sick, then she went on holiday again. The result was she ended up with a judgment against her. So if somebody sends you a letter of demand, they are pretty serious and they can go to court. If you don’t respond, they can get an automatic judgment against you, even if you’re in the right, and to get the judgment overturned is very difficult. So the second point is don’t ignore it, and then the third point is if it looks like it’s not going to go away quite quickly, I recommend that you get a lawyer involved as soon as possible.
Get a lawyer involved who is a specialist in whatever you’ve got the letter of demand for. For example if it’s something to do with tax with the ATO, go to a tax lawyer or a tax accountant, somebody who’s dealt with ATO disputes before. Find out how many disputes they’ve dealt with and how many they’ve won, they might have a special technique that you can use to get out of the problem, or they might be able to negotiate a payment plan for you. For intellectual property if you get an IP letter of demand, you’re welcome to contact me and I can help you with that.
If it’s something else, a completely different topic, speak to somebody in that field. Don’t go to a divorce lawyer for an IP letter of demand. Receiving a letter of demand can be quite scary, don’t ignore it, don’t admit anything, don’t say too much, and get professional help if it looks like it’s not going away very quickly. Sometimes spending a couple of thousand dollars right at the beginning of a case can really save you tens of thousands of dollars in the long run. So that’s how you need to deal with a letter of demand if you are unlucky enough to receive one.
