Red Bull Dispute Exemplifies The Risks Associated With Sending Cease and Desist Letters

Cease and desist letters are a lot trickier than they seem – just ask Red Bull.  An internet post went viral this week in which the owner of Old Ox Brewery – a small, family-run brewery in Virginia – took the energy drink giant to task over a cease and desist letter Red Bull sent to the brewery in which Red Bull purportedly alleged Old Ox is infringing Red Bull’s trademark.  In the post, the owner of Old Ox accused Red Bull of holding the brewery “hostage” by insisting that the brewery comply with a host of demands, including that the brewery “never use the color red, silver, or blue” and  “never use red with any bovine term or image.”  As news of the Old Ox owner’s post spread, Red Bull was condemned across the internet as a bully that is out to crush the little guy.  Some commenters even called for boycotts.

Red Bull’s predicament aptly illustrates the risks associated with sending cease and desist letters.  In Red Bull’s case, the fallout so far has been poor public relations.  In other instances, consequences can be much worse.  Usually the biggest risk of sending a cease and desist letter is that the letter may open up the sender to declaratory judgment lawsuit.  In this type of lawsuit the recipient of a cease and desist letter asks a judge to declare that the recipient is not violating the law in whatever way the letter claims.  Declaratory judgment lawsuits can be extremely harmful, such as declaratory judgment lawsuits which ask judges to declare that patents are void or that contracts are unenforceable.

Cease and desist letters can also start the clock ticking on the time period in which the sender must commence a lawsuit or risk forfeiting its rights due to an applicable statute of limitations.

Cease and desist letters should never be sent lightly.  Due deliberation is necessary to determine if the benefits of sending such a letter outweigh the risks.  When cease and desist letters are sent without due deliberation, poor public relations like the type Red Bull suffered may be the least of the sender’s problems.

Article written by Michael Keenan, Esq., associate attorney at Hinman, Howard & Kattell, LLP.  To contact Mr. Keenan directly please email him at mkeenan@hhk.com or call (607) 723-5341.

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