Cease and Desist
The filing of a declaratory judgment lawsuit can follow one party sending a cease-and-desist letter to another. A party contemplating sending such a letter risks that the recipient, or a party related to the recipient (such as a customer or supplier), may file for a declaratory judgment in their own jurisdiction. This may require the sender to appear in a distant court, at their own expense. So sending a cease-and-desist letter presents a dilemma to the sender, as it would be desirable to be able to address the issues at hand in a candid manner without the need for litigation. Upon receiving a cease-and-desist letter, the recipient may seek a tactical advantage by instituting declaratory-judgment litigation in a more favorable jurisdiction.
Sometimes the parties agree in advance of discussions that no declaratory-judgment lawsuit will be filed while the negotiations are continuing. Sometimes a lawsuit is filed, but not served, before sending such a notice, to preserve a jurisdiction advantage without engaging the judicial process fully. Some parties send cease-and-desist letters that make "an oblique suggestion of possible infringement" to lower the risk of the recipient filing a declaratory-judgment lawsuit.
Read more about this topic: Declaratory Judgment
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