What do I do if I received a letter from a paralegal stating that I should give up my domain and business name or they will sue?

It appears that you only registered your business name (IE as a sole proprietorship, DBA etc) so it would be your trade name. It is not clear if you were using your business name as a trademark. For example, did you use the ? behind your business name ever? If you were indeed using your business name as a trademark and you were doing this in the USA before the other company registered their trademark, then you are the senior mark and you may be able to have their mark cancelled - provided that you can allege that there is consumer confusion and that they are in a similar classification. Look at the USPTO website regarding "cancellation proceedings."

Your factual scenario raises a number of questions to properly advise you. First, are you in fact residing in Canada and are you doing business in the U.S.? If you are in Canada and don't do business in the U.S., then Canadian Trademark law applies, not U.S. Trademark law. Under that scenario, the U.S. company may not have jurisdiction over you and what you do in Canada, unless they have Canadian trademark rights and do business in Canada too. Second, how long has the U.S. company been using their mark? If their mark predates your use (presumably since 2007), then they may have the senior user rights in the U.S. If, on the other hand, you are the senior user, the U.S. company is in a weaker position. Third, what goods or services are you associating with the the mark in question and similarly what goods and services are the U.S. company associating with their respective mark? If the goods and services are distinguishable, you may have another reason to argue that there is no infringement because of the distinctiveness of the goods and services in question. This last question would be included in the typical trademark infringement analysis which, depending on the jurisdiction, and therefore controlling law, falls into a non-exhaustive list of factors that must be weighed to determine whether there is a likelihood of confusion and therefore, infringement. Fourth, you indicate that your name is registered as of 2011? Is that a business name registration? Or is it a Canadian Trademark registration? Or is it a U.S. trademark registration? There is a different legal and factual analysis relating to the domain name issue that is outlined in the Anti cyber squatting Consumer Protection Act, which I will not elaborate on here. As you can see, there are a lot of legal issues raised in your particular fact scenario. Furthermore, that analysis is a very factually driven and would require much more information from you to provide you proper legal guidance. So, as always, you would be well-advised to seek legal counsel to properly determine your best response strategy and to determine what your legal rights and obligations are in this particular matter.

As long as you only do business in Canada and the U.S. firm only does business in the U.S., there shouldn't be a problem. This could just be someone trying to scare you into signing over valuable intellectual property, especially since the letter is only signed by a paralegal. However, you should talk to an experienced IP attorney to see if the other company has any valid grounds for a suit against you.

Unfortunately, if they sue you - it will cost you money to defend your business and domain names. You were first according to the facts provided - and that gives you the right to keep the business and domain names. Moreover, if you had business activity in the United States before them - you may have the ability to invalidate their trademark. Facts will determine who should prevail - so you should consult a trademark/domain lawyer.