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Jumping The Gun: How Copyright and Trade Mark Threats Can Backfire

When you believe someone has infringed your copyright or trade mark, one natural first response is anger.

“Who do they think they are?” or “How dare they?”

It’s a small step from there to take steps to try and stop them. Some business owners are quick to pull the trigger and threaten legal action, or send cease and desist letters. A common example is requesting material to be taken down from a website – or else.

But acting impulsively can be a big mistake in this situation, and it can turn around and bite you.

What’s the risk?

There are provisions under both the Copyright Act and the Trade Marks Act that deal with groundless threats of legal action.

When threatened with a copyright infringement lawsuit, a person may bring their own legal action to force the person threatening to show justification.

Simply notifying someone about the existence of copyright isn’t a threat – but anything more than that could be interpreted by a court as being one.

The risks are significant. In one case, Queensland artist Richard Bell won $147,000 in damages following a groundless threat. Bell had made a film in New York with the help of an American assistant. The assistant claimed copyright and had the trailer for the film taken down from the Internet, and an exhibition and catalogue were postponed.

Bell brought a legal action, and since the threats were not backed up, he won damages for likely lost sales.

There is a similar power under the Trade Marks Act.

But wait, there’s more

It’s important to realise that it’s not just the copyright holder or the registered owner or user of a trade mark who can take legal action.

Anyone who is aggrieved by a groundless threat can bring a lawsuit too. For example, suppliers, advertisers or other associated businesses could be affected by the threat as well.

On top of all that, there is your reputation to think about. The risk of a lawsuit aside, making threats to protect your copyright or trade mark without a proper legal basis is a risk to your brand as well. Unlike the payment of damages (money can be replaced), brand damage can be permanent.

What should you do?

Given the consequences, this situation should be approached carefully. In many cases you may have a valid complaint – and of course you want to act to protect your interests.

If you feel that your rights have been infringed upon, it could pay off to do two things:

  1. Take a step back and consider the consequences before firing off a cease and desist letter, and
  2. Seek legal advice.

Getting good advice early about a possible infringement could you save a lot of time and money in the long run.

Are you prepared to take the risk of being a little trigger happy?