How to Respond to a False Cease and Desist Letter

What legal force does a false cease and desist letter have in Minnesota?

A cease and desist letter from a private party is that party’s demand, not a court order. Its arrival can still have legal effects. Under Miller v. Lankow, 801 N.W.2d 120 (Minn. 2011), the duty to preserve evidence can arise before any lawsuit is filed, “whenever a party knows or should know that litigation is reasonably foreseeable.” For a patent claim, 35 U.S.C. § 287(a) provides: “In the event of failure so to mark, no damages shall be recovered by the patentee in any action for infringement, except on proof that the infringer was notified of the infringement and continued to infringe thereafter, in which event damages may be recovered only for infringement occurring after such notice.”

A state agency’s cease and desist order is a different document. One example is Minn. Stat. § 45.027, subd. 5a.

The truthfulness checks Minnesota places on a party’s claims also begin in court. Under Minn. Stat. § 549.211, subd. 2, the certification that “the allegations and other factual contentions have evidentiary support” is made “By presenting to the court, whether by signing, filing, submitting, or later advocating, a pleading, written motion, or other paper.” Minn. R. Civ. P. 11.02 uses the same trigger: “By presenting to the court.” A letter mailed to you is not a paper presented to a court, so neither the statute nor the rule reaches it.

The letter also creates a dated record that the sender has stated its claim and has considered suing. If the letter may be right, the question is a different one: whether you have to obey a cease and desist letter.

How do you test whether the letter’s claims hold up?

You test a cease and desist letter one claim at a time, separating the facts it says happened, the contract term or law it says those facts violate, and the right the sender says it holds. A claim fails if the facts did not happen, if the conduct is lawful, or if the sender does not hold the right it asserts.

1. The facts. I suggest comparing each factual statement against your records (dates, emails, invoices, posts, delivery confirmations), because each wrong statement paired with the document that disproves it becomes a line in your reply.
2. The legal theory. The contract term or statute the letter names should be read word by word, because a letter that paraphrases a contract can describe a duty the actual term does not impose. The usual defenses to a breach of contract claim apply to a letter’s theory as much as to a lawsuit’s.
3. The sender’s right. The sender must be a party to the contract, own the trademark or copyright, or hold whatever right it claims. A trademark letter can rest on federal law, which has its own rules for trademark cease and desist letters.

Minnesota law answers one false demand directly: a letter telling a former employee to honor a noncompete. Under Minn. Stat. § 181.988, subd. 2, “Any covenant not to compete contained in a contract or agreement is void and unenforceable.” The 2023 law that enacted the ban states: “This section is effective July 1, 2023, and applies to contracts and agreements entered into on or after that date.” Two exceptions remain, for a covenant “agreed upon during the sale of a business” and one “agreed upon in anticipation of the dissolution of a business.” The statute defines “Employee” to include “independent contractors.”

The ban has limits that a letter can exploit, so I suggest reading the whole agreement. Under subd. 1, “A covenant not to compete does not include a nondisclosure agreement, or agreement designed to protect trade secrets or confidential information,” and it “does not include a nonsolicitation agreement, or agreement restricting the ability to use client or contact lists, or solicit customers of the employer.” Subd. 2 adds that it does not “render void or unenforceable any other provisions in a contract or agreement containing a void or unenforceable covenant not to compete.” A letter citing a 2024 noncompete may demand something void while its nonsolicitation, nondisclosure, or trade-secret demands under the same agreement can still be enforceable. More on Minnesota’s noncompete rules is on a separate page.

What should you preserve once a cease and desist letter arrives?

I suggest preserving every email, text, file, post, and record that bears on the letter’s claims as soon as it arrives, and stopping any routine deletion that would reach them. The reason is that Minnesota courts can sanction the loss of evidence that happens before a lawsuit is filed. In Miller v. Lankow, 801 N.W.2d 120 (Minn. 2011), the Minnesota Supreme Court said the duty to preserve evidence arises “whenever a party knows or should know that litigation is reasonably foreseeable.”

Miller was a homeowner’s mold case. The court there also held that a party with a legitimate need to destroy evidence may do so after giving the other side sufficient notice and a full and fair opportunity to inspect it. I suggest treating the letter’s arrival as the start of the duty, because a letter that threatens a lawsuit is written proof that you knew one was possible.

Loss does not have to be deliberate to cost you. In Patton v. Newmar Corp., 538 N.W.2d 116 (Minn. 1995), a product-defect case in which the motor home at issue was lost before suit, the court adopted “the prejudice to the opposing party” as the standard for testing the loss. It upheld excluding the plaintiffs’ expert evidence, and summary judgment for the manufacturer followed. For electronic data, Minn. R. Civ. P. 37.05 applies when data “that should have been preserved in the anticipation or conduct of litigation is lost because a party failed to take reasonable steps to preserve it, and it cannot be restored or replaced through additional discovery.” On a finding of prejudice, the court may order measures “no greater than necessary to cure the prejudice.” The rule reserves the harshest measures, including an adverse presumption, dismissal, or default, for a finding that the party acted “with the intent to deprive another party of the information’s use in the litigation.”

A practical hold for a small business has four parts:

• Automatic deletion turned off for the email accounts, chat channels, and phones of the people involved.
• A written note to those people asking them to keep everything related to the dispute.
• Saved copies of any web page, post, or listing the letter mentions, as it stood when the letter arrived.
• The letter itself, with its envelope or email headers, which show when it reached you.

The records that prove the letter false are the same ones a court would ask for, and that includes internal emails as evidence.

How should a written response to a false cease and desist letter be built?

A response to a false letter should answer it specifically: name each claim, say why it is wrong, and point to the fact or document that shows it. The general practice I follow is to respond and explain either that you did not do what the letter describes or that what you did is lawful. I suggest that approach because a specific answer gives the sender’s lawyer something concrete to weigh, and a general denial gives them nothing.

The letter itself can be short, with five parts:

1. A line identifying the sender’s letter by date and author and stating that you dispute its claims.
2. An answer to each claim in turn: the correct fact for a wrong fact, and the actual words of the term for a misread contract or statute.
3. Only the documents that prove a point. Sending your whole file shows the sender your case before any lawsuit exists.
4. A statement of what you will not do (stop lawful conduct, pay a sum you do not owe), with reservation of rights language so the reply is not read as giving up any claim or defense.
5. No threats, insults, or concessions. The letter may become an exhibit, and its tone will be read along with its content.

If you want to offer a compromise, I suggest sending it as a separate communication, so the offer is plainly part of compromise negotiations and the denial reads as your position on the facts. Under Minn. R. Evid. 408, an offer to compromise “a claim which was disputed as to either validity or amount” “is not admissible to prove liability for or invalidity of the claim or its amount. Evidence of conduct or statements made in compromise negotiations is likewise not admissible.” The rule “does not require the exclusion of any evidence otherwise discoverable merely because it is presented in the course of compromise negotiations.” More on making a settlement offer without admitting liability is on a separate page.

When does silence make sense instead of a written response?

Silence is a reasonable choice when the sender has little reason to spend money suing over the claim and the conduct it complains about has ended. A neighbor’s letter over a single incident is one example: a lawsuit would cost the sender far more than it could recover.

In other disputes, I suggest a reply, because an unanswered letter can leave the other side with a lawsuit as its only announced next step. A reply also opens room to resolve a real disagreement. Once, a former employee and a business settled a dispute over a noncompete signed before the 2023 ban by the employee paying to be released, which cost both sides less than a lawsuit would have.

The factors worth weighing before choosing silence:

• What the sender could realistically recover if it sued and won.
• What a lawsuit would cost the sender, and whether it has sued over similar claims before.
• Whether the conduct the letter complains about is continuing or finished.
• Whether the sender copied your customers, vendors, or a platform, which raises the stakes for you.

How can you ask a Minnesota court to decide the dispute first?

If the sender will not drop a claim that hangs over your business, you can ask a court to decide it. Under Minn. Stat. § 555.01, “Courts of record within their respective jurisdictions shall have power to declare rights, status, and other legal relations whether or not further relief is or could be claimed,” and “The declaration may be either affirmative or negative in form and effect.” Under Minn. Stat. § 555.02, “Any person interested under a deed, will, written contract, or other writings constituting a contract” “may have determined any question of construction or validity arising under the instrument, statute, ordinance, contract, or franchise and obtain a declaration of rights, status, or other legal relations thereunder.”

The court needs a real dispute. In McCaughtry v. City of Red Wing, 808 N.W.2d 331 (Minn. 2011), a challenge by landlords and tenants to a city rental-inspection ordinance, the court held their claim justiciable. It stated that a justiciable controversy exists if the claim “(1) involves definite and concrete assertions of right that emanate from a legal source, (2) involves a genuine conflict in tangible interests between parties with adverse interests, and (3) is capable of specific resolution by judgment rather than presenting hypothetical facts that would form an advisory opinion.” Whether a particular letter is concrete enough turns on what it claims and what it demands.

Federal courts have their own declaratory judgment statute, 28 U.S.C. § 2201. “In a case of actual controversy within its jurisdiction,” outside a list of exceptions that includes federal taxes, a federal court “may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought.” For a patent or copyright demand, 28 U.S.C. § 1338(a) provides: “No State court shall have jurisdiction over any claim for relief arising under any Act of Congress relating to patents, plant variety protection, or copyrights.”

Filing first costs money. In Dunn v. National Beverage Corp., 745 N.W.2d 549 (Minn. 2008), a franchise dispute, the court restated the general rule that “attorney fees are not recoverable in litigation unless there is a specific contract permitting or a statute authorizing such recovery.” I suggest weighing that cost against what the unresolved claim costs your business, a tradeoff covered in more depth under filing a declaratory judgment action in Minnesota.

What protection applies if the sender sues over your speech?

Suppose the letter accuses you of defamation or another wrong based on what you said, and the sender then sues. Minnesota’s Uniform Public Expression Protection Act can end a weak claim early, and the court must award “court costs, reasonable attorney fees, and reasonable litigation expenses related to the motion” “to the moving party if the moving party prevails on the motion.” The act is sections 554.07 to 554.19 of Minnesota Statutes, named in Minn. Stat. § 554.07. It does nothing about the letter itself. Its motion window runs from the day “a party is served with a complaint.”

Under Minn. Stat. § 554.08, paragraph (b), the act reaches a claim based on communications in government proceedings and on a person’s “exercise of the right of freedom of speech or of the press, the right to assemble or petition, or the right of association, guaranteed by the United States Constitution or the Minnesota Constitution on a matter of public concern.” When it applies, the steps are these:

• Early motion. Under Minn. Stat. § 554.09, “the party may file a special motion for expedited relief to dismiss the cause of action or part of the cause of action.” The statute sets a short filing deadline measured from service of the complaint, so I suggest reading its current text the day you are served.
• Pause on discovery. Under Minn. Stat. § 554.10, paragraph (a), on filing the motion, “all other proceedings between the moving party and responding party, including discovery and a pending hearing or motion, are stayed,” subject to listed exceptions, including limited discovery the court may allow under paragraph (d).
• Dismissal. Under Minn. Stat. § 554.13, paragraph (a), “the court shall dismiss with prejudice” if “the moving party establishes under section 554.08, paragraph (b), that sections 554.07 to 554.19 apply,” no exclusion is shown, and, among other grounds, “the responding party fails to establish a prima facie case as to each essential element of the cause of action.”
• Fees. Under Minn. Stat. § 554.16, “the court shall award court costs, reasonable attorney fees, and reasonable litigation expenses related to the motion” “to the moving party if the moving party prevails on the motion.”

The exclusions matter for a business. Under § 554.08, paragraph (c), the act does not apply to a claim “against a person primarily engaged in the business of selling or leasing goods or services if the cause of action arises out of a communication related to the person’s sale or lease of the goods or services,” and it does not apply “for any claim brought under federal law,” such as a federal trademark claim. Under paragraph (d), the act does apply “to a cause of action asserted under paragraph (c), clause (3), (8), or (11),” when the cause of action is, among other things, “a legal action against a person related to the communication, gathering, receiving, posting, or processing of consumer opinions or commentary, evaluations of consumer complaints, or reviews or ratings of businesses.” Paragraph (b)’s public-concern requirement still applies to those claims, as § 554.13 requires. For the review-side questions, see fake or defamatory online reviews.

What can happen to a sender who pursues a false claim?

The sender of a false letter faces no sanction under Minnesota’s sanctions statute or Rule 11 for the letter alone, because both apply to papers presented to a court. Once the sender files a lawsuit, the statute applies to its complaint.

Under Minn. Stat. § 549.211, subd. 3, “If, after notice and a reasonable opportunity to respond, the court determines that subdivision 2 has been violated, the court may, subject to the conditions in this section, impose an appropriate sanction.” The statute sets conditions on how that happens:

• Under subd. 4, “A motion for sanctions under this section must be made separately from other motions or requests and describe the specific conduct alleged to violate subdivision 2.” It is served first, and it “may not be filed with or presented to the court unless, within 21 days after service of the motion, or another period as the court may prescribe, the challenged paper, claim, defense, contention, allegation, or denial is not withdrawn or appropriately corrected.”
• Under subd. 4, “If warranted, the court may award to the party prevailing on the motion the reasonable expenses and attorney fees incurred in presenting or opposing the motion.”
• Under subd. 5, “A sanction imposed for violation of this section must be limited to what is sufficient to deter repetition of the conduct or comparable conduct by others similarly situated.” And “Monetary sanctions may not be awarded against a represented party for a violation of subdivision 2, clause (2),” which is the clause about legal contentions. Subject to those limits, the sanction may include, “if imposed on motion and warranted for effective deterrence, an order directing payment to the movant of some or all of the reasonable attorney fees and other expenses incurred as a direct result of the violation.”

Minn. R. Civ. P. 11.03 provides a parallel sanctions procedure. I suggest keeping a copy of your denial and every document you sent with it, because subd. 2 asks whether the sender’s contentions were “formed after an inquiry reasonable under the circumstances,” and your letter shows what the sender had in hand before it filed.

A sender that repeats its false accusation to your customers, vendors, or a platform raises separate questions. The claims a recipient can bring against the sender are covered on their own page.

Responding to a False Cease and Desist Letter

A false cease and desist letter from a private party is a demand, not a court order. The response I suggest is to test each claim against your records and the governing text, preserve everything the dispute touches, and answer in writing with a specific denial, keeping any settlement offer separate. Under Minn. Stat. § 555.01, Minnesota courts “within their respective jurisdictions” have power to declare your rights on a real dispute before the sender sues. If the sender does sue, Minnesota offers sanctions procedures once a complaint is filed and, when the claim targets protected speech, an early dismissal motion with costs and fees related to the motion awarded to a moving party who prevails. For a patent or copyright dispute, 28 U.S.C. § 1338(a) provides: “No State court shall have jurisdiction over any claim for relief arising under any Act of Congress relating to patents, plant variety protection, or copyrights.” More on Minnesota contract disputes is on my practice page.

If you have received a cease and desist letter you believe is false, email [email protected] with a brief description of the dispute. I start with a conflict check before you send the letter or any documents, and I can then tell you which of its claims your records answer and what response fits the facts.