Date

FOR SETTLEMENT PURPOSES ONLY

Victim's Name & Address

Re: Unlicensed (Client's name) Merchandise
Our Ref: No. 000-00

Dear (Victim's name)

I am writing in response to your email of (insert date) to my paralegal, Denise Mosteller. As you know, our client, (Client name) object to certain merchandise produced and sold by (Victim's company name).

Although it is not our responsibility to educate you on matters of trademark law, I am willing to respond briefly to your argument in an effort to facilitate an informal settlement.

To begin with, the first sale doctrine 17 USC §109, as cited in your email, deals with copyrights and not trademarks; however, with regards to the application of the first sale doctrine and to trademarks, the infringing (item) by (victim's company) would not be protected.

Resale of the item by the first purchaser of the original trademarked item is generally neither trademark infringement nor unfair competition. Brilliance Audio, Inc., v Haights Cross Communications, Inc., 474 F.3d 365, 370 (6th Cir 2007). Confusion ordinarily does not exist when a genuine article bearing a true mark is sold. Id. Thus, the first sale doctrine only applies to the sale of the original item and not to altered merchandise that serves a completely separate purpose from the genuine product.

Moreover, there are two situations in which resale of a product does not fall under the first sale doctrine. Id. The first situation is when the notice that the item has been repackaged is inadequate. Id. Since repackaging is not an issue in this case, I will not delve into a discussion regarding that issue. The second situations when the first sale doctrine is inapplicable is when an infringer sells trademarked good that are materially different from those sold by the trademark owner. Id. The rationale behind this exception is that material difference in a product is likely to confuse consumers and cause dilution of the trademark. Id.

To be material, a difference must be one that consumers consider relevant to a decision about whether to purchase a product. Id. Most certainly, consumers will evaluate a different set of factors when making a decision whether to purchase (client's product) versus lamps made out of empty (client's name) bottles. At any rate, the question of whether the item being sold by the infringer is materially different from the trademarked item is one of fact reserved for the jury. Id. While (client's name) (is) more than confident that the infringing items being sold by (victim's company) do not fit under the first sale doctrine, it would not be cost-effective for either party to litigate this issue. For this reason, settlement is the best resolution in this case.

(Client's name) reiterate(s) their original demands for cessation of the sale of this merchandise and monetary damages. Please remove these items from your website no later than (insert date) or your continued sale will be considered willful and intentional. The damages amount previously requested, $7,500.00 each, represents an amount to offset the resources invested by (client's name) for the investigation and resolution of this matter as well as the amount of damage done to (client's) trademarks by your unauthorized manufacture and sale of the infringing merchandise. Should you refuse to cese (sic) your unauthorized activities, this demand shall be revoked in favor of triple and statutory damages.

Please contact my office in order to settle this matter. I look forward to resolving this issue as quickly and as amicably as possible.

This letter is being sent in an attempt to achieve a prompt and informal resolution of this matter, and is thus privileged. Nothing contained in/or omitted from this letter or any prior communication is intended to be or should be considered an admission of any fact or a waiver of any right or defense, all of which are expressly reserved.

Sincerely,

Darlene Seymour
General Counsel