Cease-and-desist letter with penalty clause—don't sign anything that will bind you for 30 years
The statement attached to the cease-and-desist letter was written by the opposing party's attorney—on behalf of the opposing party. We'll review it to determine what parts you actually need to sign—and what needs to be removed before you do so.
What It's All About
What You're Holding in Your Hand Right Now
A pre-drafted contract offer—not an administrative order or a court order.
A cease-and-desist letter is unpleasant, but at first it’s just a letter. The attached cease-and-desist declaration is something else entirely: it’s an offer to enter into a contract. If you sign it and the other party accepts it, a contract is formed between you—and its effects extend further than most people realize. It doesn’t end once the dispute is forgotten. In practical terms, it never ends.
The underlying principle is the so-called “risk of repetition.” Anyone who has ever used a photo without a license, mislabeled a price, or failed to label a post as advertising is presumed by the law to be likely to do it again. This presumption is strong, and it does not disappear simply because you delete the post or promise to refrain from doing so in the future. It disappears only through a sincere promise of a penalty—hence “subject to penalties.” Only when a violation costs you real money will the legal system believe that you are serious.
That is precisely why the declaration is such an effective tool: it spares the other party the trouble of going to court. And that is precisely why the pre-drafted version in the appendix is regularly broader in scope than it needs to be. It is not a neutral form, but rather your opponent’s draft.
Requirements
When a cease-and-desist declaration Eliminates the Risk of Recurrence
Four requirements—if even one is missing, the risk remains, and the opposing party can still file a lawsuit.
Seriously
The statement must be clearly intended. A letter that is subject to reservations, contains conditions, or includes the phrase “without acknowledging any legal obligation and without any intention to be bound” does not constitute an admission of anything.
Absolutely
No conditions, no consideration, no "provided that it turns out that…". The clause "without acknowledging any legal obligation, yet legally binding," on the other hand, is permissible and reasonable.
Permanent
A time limit of two or five years may seem reasonable, but it is invalid. The declaration is permanent—and can be rescinded only under very limited circumstances, such as a change in the legal situation.
Subject to appropriate penalties
Without a contractual penalty, it’s not taken seriously. However, the amount does not have to be specified in writing, nor does it have to match the amount proposed by the other party—this is where you have the greatest room for negotiation.
Mistakes with Consequences
What You Should Never Do
These are the four reactions we see most often—and they're all expensive.
Sign the attached statement as is
The most common and most costly mistake. The opposing party’s draft is deliberately worded broadly; it usually includes a fixed amount that is too high, an acknowledgment of costs, and an obligation that goes beyond the alleged violation.
Rewrite it yourself
A statement that’s too narrow doesn’t rule out the risk of a repeat offense. The other side can assume that’s the case—you’re bound by it—and they’ll sue anyway because your wording doesn’t cover the essence of the matter. The worst of both worlds.
Let the deadline pass
The deadlines in cease-and-desist letters are short—often just one week. If the deadline passes, a preliminary injunction is typically issued in competition and trademark cases—without a hearing and without you being given a chance to be heard beforehand. The costs then rise significantly.
Call the opposing law firm and explain
Every “that was just a one-time thing” and “I didn’t know that” is an admission that gets recorded. A phone call with the other side never improves your situation—it just provides evidence.
Range
Why the explanation goes far beyond the case in question
The crucial point that almost no one is aware of: the core theory.
A cease-and-desist declaration does not merely cover the specific act that was the subject of the warning letter. It covers all infringements that are essentially the same—that is, all variations in which the characteristic nature of the infringement remains intact. Case law refers to these as “essentially the same infringements,” and it interprets the term broadly.
It’s easy to see what this means in practice. An agency receives a warning letter for using an unlicensed stock photo in a client pitch. It signs the cease-and-desist agreement. Two years later, the same image appears in an old case study PDF on the agency’s own server—different medium, different context, same core. A contractual penalty is due. Or: An online store agrees to refrain from a specific price promotion. The text in the product data feed is not changed; the feed transmits the wording to a price comparison site. This, too, is “essentially the same.”
That’s why drafting the declaration isn’t just a matter of due diligence—it’s the actual legal service. It must be broad enough to eliminate the risk of recurrence, yet as narrow as possible so that you aren’t held liable for things no one is thinking about at the moment of signing.
If I change the medium, channel, or wording, but the nature of the infringement remains the same, it constitutes a violation with the same core elements. Switching from Instagram to TikTok, from the website to the newsletter, or from German to English text does not protect you.
Anyone who undertakes to refrain from a certain action is not only obligated to refrain from that action itself. They must also take steps to influence third parties to the extent that this is possible and reasonable—in the case at hand, retailers who continued to offer the goods in question.
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The Right Way
The Modified Cease-and-Desist Letter
Don't sign the other party's statement—submit your own, which is just as effective and less binding on you.
The modified cease-and-desist letter is the norm, not the exception. You don’t submit a letter drafted by the other party, but one that we draft. It addresses the risk of recurrence in exactly the same way—but on your terms. Three key factors are crucial here.
Narrow the scope
The opposing party’s draft often imposes a blanket obligation on you to refrain from using “the photographer’s works” or “the trademark.” The correct approach is to limit this to the specific form of infringement—that is, to what actually occurred.
Contractual Penalty Under Hamburg Custom
Instead of a fixed amount, the amount to be paid in the event of a violation is determined by the creditor at its reasonable discretion—and may be reviewed by a court upon request. In the case of minor, inadvertent violations, this results in a significantly lower amount.
Delete "acknowledgment" and "costs"
Pre-drafted cease-and-desist letters often include an acknowledgment of the infringement and a commitment to pay attorneys' fees. Neither of these elements belongs in the cease-and-desist letter and is negotiated separately.
Money
The Contractual Penalty—and Why a Fixed Amount Is Rarely in Your Best Interest
The point at which it is determined what a future mistake will cost.
Pre-formulated statements almost always specify a fixed amount. This is convenient for the other side and bad for you: You’ll have to pay the full amount, regardless of whether you committed the violation repeatedly and intentionally or whether a six-year-old blog post in the archive was overlooked. There is no differentiation based on severity.
The Hamburg practice turns this on its head. The amount is not set in advance but is determined by the creditor at their reasonable discretion in the event of a violation—and you can have it reviewed in court. The criteria then include the severity and duration of the violation, fault, company size, and economic benefit. A one-time slip-up is treated differently than a calculated violation.
As for the magnitude: In competition, trademark, and copyright cases between businesses, contractual penalties typically range from the mid to high four-digit range, and significantly higher for substantial violations. Competition law also imposes additional restrictions on smaller companies: In the case of a first-time warning regarding certain information and labeling requirements in e-commerce, no contractual penalty may initially be imposed on companies below a certain size. Whether this applies in your case is one of the first questions we will examine.
The determination of the amount of support by one party is made at its reasonable discretion and is subject to judicial review. This is precisely what the arrangement is based on—it provides you with a mechanism for oversight that a fixed amount does not offer.
Underestimated
The work really begins after the signing
The obligation to refrain from certain actions is not the same as passivity. It requires active action—and this is where most contractual penalties arise.
The most common misconception is: “Post deleted, case closed.” In fact, you owe more than just inaction. You must rectify the situation you’ve created, and you must take action with third parties to the extent that this is possible and reasonable for you. Anyone who fails to do so is violating their own statement—and the other party need do nothing more than search for it.
Experience shows that violations always linger in the same places: the Google cache and image search, which continue to display the old version for days on end; marketplace listings on Amazon or eBay that are automatically updated via a data feed; Retailers and resellers who have copied your product description word for word. Newsletter archives that are publicly accessible. Old Instagram and TikTok posts below the first screen. News portals where a press release was published. And PDFs on your own server that are no longer linked to by any site but are still indexed.
That’s why every cease-and-desist letter we draft includes a checklist—and the recommendation to document the results with the date. If an allegation of a violation arises later, this documentation will determine whether you can dispute liability.
Resistance
When You Don't Sign at All
Not every warning letter is justified—and not every justified warning letter is formally valid.
There are cases in which the correct response is not a modified statement, but no statement at all. This is the case when the allegation is substantively unfounded: when the use was covered by a license, when there is no likelihood of confusion, when the statement constitutes a permissible opinion, or when the wrong party was simply sent a cease-and-desist letter.
In addition, there are formal objections. Competition law sets minimum substantive requirements for cease-and-desist letters—if these are not met, the recipient may demand reimbursement of their own legal defense costs. For certain violations in e-commerce, the right to reimbursement of warning letter costs is excluded from the outset. And where a warning letter serves primarily to generate fees, the defense of abuse of rights applies.
If you anticipate that the opposing party will proceed to court anyway, a protective brief is the best course of action: a precautionary defense filed with the central registry for protective briefs to ensure that no court issues a preliminary injunction without having reviewed your arguments. In persistent cases, a negative declaratory action may be considered—in which case you, not the opposing party, determine the timing and the court.
From Real-World Experience
What the situation is like in your industry
Six combinations that regularly make their way onto our table.
Agency
A stock photo makes its way from a pitch deck to a case study, and from there to a social media post. The license only covered the presentation. The person whose byline appears beneath the image receives the warning—not the intern who inserted it.
Online Store
A promotional price without the correct reference, a missing base price, or a discount that never actually applied. The cease-and-desist declaration must also cover the product data feed—otherwise, the system will continue to display the disputed wording.
Influencers and Creators
A post without an advertising label, a Reel with third-party audio. What’s particularly tricky: The policy covers essentially identical violations across all channels. If you only clean up your Instagram and forget about TikTok, you’ll have to pay.
Label and Production
A sample without authorization, a cover without cleared image rights, a release before a contract has been signed. In these cases, a declaration of discontinuance is often tied to an ongoing release schedule—and the deadline is then the real problem.
Startup
The name sounds too much like a registered trademark. A cease-and-desist declaration that is too broad could paralyze the entire brand presence—including the domain name. The scope is what matters, not the contractual penalty.
Photographers and Designers
The other side of the story: Your image is being used without a license. In that case, you’re the one who has to demand a cease-and-desist letter—and how you word it will determine whether you’ll see any money the next time it’s used or whether you’ll have to start all over again.
The Other Side
You want to enforce a cease-and-desist letter yourself
We work on both sides—and that makes the phrasing better.
If your rights are infringed, a cease-and-desist letter is the most effective and cost-efficient remedy: It permanently binds the opposing party without requiring you to file a lawsuit. It is crucial that the wording of your letter fully covers the essence of the infringement. If it is too narrow, the opposing party can publish the next variation with impunity.
Equally important is how you handle a modified declaration that is returned to you. Not every modification is acceptable—but not every one is a reason to refuse acceptance and file a lawsuit. And if a violation occurs later, the contractual penalty must be consistently enforced; otherwise, the declaration loses its effect.
Procedure
From a Warning Letter to a Clear Explanation
Four steps, and at each step, you’ll know exactly where we are.
Secure the deadline
First, let’s check the date. If the deadline is too tight, we’ll extend it—that’s usually possible and won’t cost you anything except a phone call.
Check
Is the allegation even valid? Is the formal notice legally valid? Only once that has been clarified does the question of an explanation arise.
Rewrite the sentence
We will draft our own statement: narrowly worded, without acknowledgment, and with a contractual penalty in accordance with Hamburg practice.
Remove and document
You’ll receive a checklist for the cache, feeds, archives, and merchants—and document the results with the date.
Send us the cease-and-desist letter as a PDF—we’ll let you know if it’s valid and what you should sign.
Frequently Asked Questions About the Cease-and-Desist Letter
No one can legally force you to do anything. If you don’t issue a statement and the warning letter is justified, a preliminary injunction or a lawsuit will usually follow—and those can cost many times more. That’s why issuing a statement is usually the economically sensible course of action, but it must be done correctly.
During a no-obligation initial consultation, we’ll determine—at no cost—whether and how we can help. The actual review of the cease-and-desist letter and the drafting of the revised statement constitute an initial consultation starting at €250; for consumers, the fee starts at €190, plus sales tax in each case.
Only in exceptional cases. The agreement is intended to be long-term. A termination may be considered if the legal situation changes and the conduct in question becomes permissible in the future—in which case the cease-and-desist agreement may be terminated for good cause. This is the exception, not the rule.
The contractual penalty is also payable in cases of negligence. Whether it is payable—and, if so, in what amount—depends on the circumstances when the provision is based on Hamburg custom; that is precisely the purpose of this legal construct. With a fixed amount, there is no such leeway.
No. You must also ensure that the content is removed from caches, image search results, archives, and data feeds—and contact third parties who have reposted it, to the extent that this is possible and reasonable for you to do so. This is exactly where most contractual penalties arise.
Instead of a fixed amount, the contractual penalty in the event of a breach is determined by the creditor at its reasonable discretion and is subject to judicial review. For you, this means that a minor breach costs less than a serious one—with a fixed amount, you would pay the same in both cases.
When it comes to the risk of recurrence, what matters is not the assumption itself, but whether your explanation is sincere and sufficiently comprehensive. If the other party rejects it and proceeds anyway, this is often a strong argument in your favor—provided the explanation was properly worded.
Yes, across all channels. Violations that are essentially the same are recorded, regardless of the platform. Old posts that are still accessible are considered ongoing violations—which is why the archive should be included in the processing list.
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