You don't respond to this letter. They are asking you to make admissions that they can use in court to sue you for trademark and copyright infringement. Your next move---which is critical, is to retain intellectual property litigation counsel (someone like me) to defend you. Your counsel can then try to negotiate a settlement that limits your liability,
At present, you substantial potential liability for copyright and trademark infringement. For example, each logo that you used could lead to damages of no less than $750 up to $150,000 (for each logo) for willful copyright infringement---and you could also be liable for trademark infringement. Further, you could be liable to pay the attorneys fees of the CDL and/or the owners of the copyrights and trademarks.
By the way--it does not matter that you "thought" the wholesaler is licensed. If you are dealing in sports logos, you have an absolute duty to assure they are legitimate and not counterfeit. I hope you entered into a written agreement (negotiated by counsel) with your wholesaler pursuant to which he represented that the goods are authentic and he agreed to indemnify you for losses in the even this representation proved false. If you did not enter into an agreement containing such terms, then this shows that you (a) have not been adequately represented by counsel, and (b) have been engaging in reckless and irresponsible business practices that could be disastrous for you financially. You obviously need to retain intellectual property and business counsel to lay the proper foundation for your business and advise you how to operate in a more responsible and safe manner.
1. Remember the crime shows on TV, where the police officer tells the accused "anything you say can and will be used against you"? Well, although this isn't an arrest by a government official (as Professor Harold Hill said in Music Man): "heed this warning before it's too late."
2. In this situation, and whenever you face potential legal liability, engage a lawyer to advise and assist you in avoiding the pitfalls.
3. Have you ascertained whether CAPS is really authorized to "protect" sports logos? I am familiar with the International AntiCounterfeiting Coalition (IACC), which for years was headed by my buddy from law school, Jim Bikoff. But the only thing I know as to CAPS is what I read on the Web about it. And that doesn't lead me to a sense of confidence in their bona fides.
This posting is intended for general education and isn't "legal advice." It doesn't create or evidence an attorney-client relationship. You are encouraged to engage an attorney in the pertinent jurisdiction for confidential legal advice on matters of any importance. -Gerry J. Elman, J.D. Elman Technology Law, P.C. Swarthmore, PA www.elman.com
Don't. Get a trademark lawyer and have him or her answer the letter for you. They're asking you for a list of facts they can use to sue you for trademark infringement, and you should absolutely not be providing them with ammunition unless you know what you're doing. Are you sure your wholesaler wasn't licensed, now? Or are you just assuming that because you got the CDL? Don't trust that they know the whole story; they're just looking to use the threat of litigation to force you to fork over as much cash as they possibly can in a quick settlement.
Get a lawyer. On Monday. Morning.
No information you obtain from this answer is legal advice, nor is it intended to be. You should consult an attorney for individualized advice regarding your situation. No attorney-client relationship is formed by my responding to your question.
Reply with the assistance of an attorney.
This is not a legal advice or solicitation, and does not create an attorney-client relationship. Consult with an attorney. I work for Cardinal Risk Mangement and Cardinal Intellectual Property, IP service companies, but not law firms. I also am the president of Vepachedu Educational Foundation Inc., which is a non profit educational foundation. I also write cultural and scientific compliations for the foundation. I also teach at Northwestern university as a guest lecturer. I also provide some pro-bono guidance on immigration and other issues through Indian American Bar Association. I also have a contract with Cardinal Law Group, a law firm, for IP projects. All this information is on my profile at Avvo and also at Linkedin. Any views/opinions expressed in any context are my personal views in individual capacity only, and do not represent the views and opinions of any firm, client, or anyone else, and is not sponsored or endorsed by them in any way.