This reminds me about how important it is to have a solid lawyer, and an understanding of the legal ecosystem. Even in cases like this with typos, "respond in ten (10) days" can be quite intimidating, especially when there's a money/legal power asymmetry.
In one such case, Monster Cable issued a C&D to a much smaller, Blue Jeans Cable. The founder actually worked in litigation for 19 years and I found this portion of his response informative:
I have seen Monster Cable take untenable IP positions in various different scenarios in the past, and am generally familiar with what seems to be Monster Cable's modus operandi in these matters. I therefore think that it is important that, before closing, I make you aware of a few points.
After graduating from the University of Pennsylvania Law School in 1985, I spent nineteen years in litigation practice, with a focus upon federal litigation involving large damages and complex issues. My first seven years were spent primarily on the defense side, where I developed an intense frustration with insurance carriers who would settle meritless claims for nuisance value when the better long-term view would have been to fight against vexatious litigation as a matter of principle. In plaintiffs' practice, likewise, I was always a strong advocate of standing upon principle and taking cases all the way to judgment, even when substantial offers of settlement were on the table. I am "uncompromising" in the most literal sense of the word. If Monster Cable proceeds with litigation against me I will pursue the same merits-driven approach; I do not compromise with bullies and I would rather spend fifty thousand dollars on defense than give you a dollar of unmerited settlement funds. As for signing a licensing agreement for intellectual property which I have not infringed: that will not happen, under any circumstances, whether it makes economic sense or not.
There are several obvious points to be made here, but there's a subtle one, too. These hit-and-run settlements depend fundamentally on the compliance of isolated companies. If a larger organization asserts control over a smaller one (like the township-->$3.17 website, here, or on a larger scale Monster-->Blue Jeans), it often does make "economic sense" to settle.
It's almost a negative version of the Tragedy of the Commons / Public Goods Dilemma. If every small company stood up and said "no, we will not settle" then there would be far less incentive to pursue bogus infringement claims. On the other hand, it always, locally, makes sense not to challenge claims and let some other small company deal with it.
This brings me to one broader point, and that's the idea of standing for something on principle. I don't mean this in the sense of "be a moral person", but in the sense of larger organizations assuming (often correctly) that the short-term economic sense of individual actors will outweigh any principled objections they hold to the circumstances imposed by the power asymmetry. Cultivation of principles which favor the latter instead of the former course of action might be a good solution to the public goods dilemma outside of a difficult to ensure coordination of action.
It's worth thinking about this in the context of Google and its recent stance against an entity with an enormous amount of legal power.
http://www.audioholics.com/news/industry-news/blue-jeans-str...