4-2 CEASE-AND-DESIST LETTER

• Jurisdiction: United States

4-2 Cease-and-Desist Letter

Most trade secret cases begin not with the filing of the complaint or petition but with a pre-suit cease-and-desist letter. The main purpose of this letter is to put the potential defendant on notice of the threat of a trade secret misappropriation claim. Depending on the circumstances, pre-suit demand letters can often lead to an early settlement, thus obviating the need to file the lawsuit in the first place. If a settlement does not result, however, at the very least, a cease-and-desist letter ensures that the potential defendant is on notice of the claim and is thus required to retain evidence or risk suffering spoliation sanctions discussed below.

There are several circumstances in which you should strongly consider sending a pre-suit demand letter on behalf of your client. One is when an employee leaves to work for a competitor. If this happens, you or your client could send a letter to the departing employee and perhaps to his or her new employer—regardless of whether that employee is suspected of taking trade secret information. This letter should set forth any continuing contractual or other obligations under which the departing employee remains, including any confidentiality obligations. It should also explain to the departing...