Responding to a Non Compete Cease and Desist Letter
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The letter might or might not use the term "cease and desist." Some version of those words is often the first thing you hear from your former employer if they believe you are violating a non compete agreement.
It will be written by their lawyer and make often very inflammatory assertions about what they believe you are doing to violate the agreement. It will usually demand that you cease and desist (meaning stop) doing whatever it is they say you are doing. It will usually close with threats of expensive lawsuits and court orders. You should take the letter seriously, but know that it is not at this point a lawsuit. Below are some things you should consider in deciding how to deal with a cease and desist demand letter. What Does the Letter Mean?This letter is not not an order of a court, despite the fact that it may contain words like "you are ordered to." It is not a formal complaint in a court of law. It does not reflect a judgment by anyone other than your former employer and the lawyers hired to represent them that you have done anything wrong.
The letter is notice that your former employer is at least considering filing suit under the non compete agreement. It is also an invitation to try to resolve the situation, though it may not read that way at all. Do You Have to Respond to the Cease and Desist Letter?The short answer is no, but you probably should. The answer is "no" because a demand letter is not a lawsuit, and you are under no legal obligation to respond.
The reason you probably should respond is because no response at all usually only deepens your former employer's suspicion that you are violating your employment agreement, no matter how unfounded that suspicion may be. Do You Have to Stop What You are Doing?Again, this letter does not have the force of a legal order. That means you are under no legal obligation to immediately "cease and desist."
At the same time, it is a good idea to consult a lawyer quickly. You will need advice about how to best protect yourself in the short term, while determining how to respond to the actual letter. There may also be steps you can take that can ease your former employer's concerns. You might separate any contacts or information related to your former employer in your phone or computer and put it safely out of reach. This can make it easier to prove that you are not contacting their customers. It can also help you prove you are not accessing or using their trade secrets. |
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What You Should Do When You Get a Cease and Desist Letter
You do not need to panic. The letter is just the beginning of a process that a good lawyer can help you get through.
At the same time, you have to take the threat of a lawsuit seriously. You should be careful not to let any important or relevant evidence be lost or destroyed. This evidence can be very helpful to you if there is a lawsuit.
Even if it is not helpful, there can be serious sanctions for people who allow relevant evidence to be destroyed if they know there may be litigation. This is called "spoliation," and it is not something you want to be accused of doing. This means you should preserve emails, text messages, and other communications and documents relevant to the issues at hand.
At the same time, you have to take the threat of a lawsuit seriously. You should be careful not to let any important or relevant evidence be lost or destroyed. This evidence can be very helpful to you if there is a lawsuit.
Even if it is not helpful, there can be serious sanctions for people who allow relevant evidence to be destroyed if they know there may be litigation. This is called "spoliation," and it is not something you want to be accused of doing. This means you should preserve emails, text messages, and other communications and documents relevant to the issues at hand.
How Should You Respond to a Cease and Desist Letter?
If you read the claims in the letter and it is clear there is some kind of mistake or misunderstanding, you may be able to reach out to someone in your former company directly to clear up the misunderstanding. In most cases, however, it is smart to consult at least initially with legal counsel experienced in non compete agreements who can help you understand your options and level of risk of a lawsuit.
Most often, the best course is to have your lawyer prepare a written response to the cease and desist letter, and engage in a discussion with your former employer about finding a resolution that works for everyone. If those efforts fail, and you find yourself dealing with an actual lawsuit, at least you will know that you have done what you can to avoid that outcome.
Sometimes a cease and desist letter will also be sent to your new employer. This letter may threaten them with suit for interference with your non compete contract. Except in limited circumstances, your new employer should not have a serious risk of legal liability. If the letter causes your new employer concern, we can help discuss the situation and your defenses to your non compete with the new employer or their lawyers.
For more information, see answers to frequently asked questions about non compete lawsuits.
Most often, the best course is to have your lawyer prepare a written response to the cease and desist letter, and engage in a discussion with your former employer about finding a resolution that works for everyone. If those efforts fail, and you find yourself dealing with an actual lawsuit, at least you will know that you have done what you can to avoid that outcome.
Sometimes a cease and desist letter will also be sent to your new employer. This letter may threaten them with suit for interference with your non compete contract. Except in limited circumstances, your new employer should not have a serious risk of legal liability. If the letter causes your new employer concern, we can help discuss the situation and your defenses to your non compete with the new employer or their lawyers.
For more information, see answers to frequently asked questions about non compete lawsuits.
How We Can Help
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We have years of experience representing people in non compete lawsuits in Massachusetts state and federal courts, as well as responding to cease and desist letters, and we would be happy to help. You can use the button below to schedule a call back from a member of our team, or give us a call at 781-784-2322.
