cancelled order says we can't sell product

[Grinkol]

We had a customer order a product from us made to the specs. Mid-production they cancelled the order. We told them we would just sell the product to recoupe some or all of our losses. They threaten us they would sue due to copyright infringement. Do we have any options to recover any of the money?

Thanks for the advice.

 

[Michael Wechsler]

We had a customer order a product from us made to the specs. Mid-production they cancelled the order. We told them we would just sell the product to recoupe some or all of our losses. They threaten us they would sue due to copyright infringement. Do we have any options to recover any of the money?

This question is impossible to answer without knowing all the details. What I can say is that if they are claiming that they would sue you for infringement, you could sue them for 100% of the amount of the contract and they can't claim that you didn't "mitigate" or reasonably reduce your damages. You should check your contract to see if there are remedies for breach of contract.

But there is one other issue I have with regard to copyright infringement - I'm not sure they have a right to sue you. After all, you made your copies with their permission and if they went to court, they would be unable to sue you based upon their breach of the contract (it's also known as the "unclean hands" doctrine.) Many times these threats are usually idle, attempts to scare you rather than having any validity in law. But without seeing all the details, I can't give you a definite answer. Good luck!