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Civil Demand Letter
(Definition and Statistics in 2024)

A civil demand letter is a written notice sent by a plaintiff to a defendant demanding payment or other actions to resolve a legal claim or dispute. In the context of retail theft, for example, a civil demand letter may be sent by a store to a person accused of shoplifting. The letter typically demands payment of a monetary sum as compensation for the alleged theft, as well as any additional costs incurred by the store, such as legal fees or administrative costs.
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C.L. Mike Schmidt Published by C.L. Mike Schmidt

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Civil Demand Letters and Shoplifting

When apprehended for shoplifting, individuals are often informed by store security that they will receive a civil demand letter by mail. These letters are typically issued by the store, a law firm, or a debt collector and reference the date of the shoplifting incident.

According to the California Courts, civil demand letters request a specific sum of money, often payable in cash or by cashier's check, and include a deadline for payment. Failure to comply may result in additional follow-up letters, some of which may include fees to cover collection efforts [1].

Civil Demand versus Criminal Charges

A civil demand is strictly a civil matter, but a store has the option to file a criminal complaint with the police as well. This decision is sometimes made when the store believes that a civil demand will not be sufficient.

A district attorney or prosecutor will review the complaint and make a decision whether or not to file criminal charges against the accused. If a prosecutor doesn't pursue a case, it does not necessarily mean that the store cannot pursue a civil lawsuit.

According to "The Law" research from 2014, if a store decides not to file a civil lawsuit, it does not typically prevent a prosecutor from pursuing criminal charges against a shoplifter or an employee involved in retail theft. In some states, both actions can occur simultaneously, while in others, only one action can proceed. Understanding your state's shoplifting and retail theft laws is crucial in these situations [2].

What Should I Do if I Receive a Civil Demand Letter?

If you receive a demand letter, it's wise to seek legal advice from a criminal defense lawyer.

An attorney is likely to caution against hasty actions, such as making a payment, as this could be seen as an admission of guilt.

It's important to understand that even if you make a payment in response to a demand letter, the store may still choose to pursue criminal charges or a civil lawsuit against you.

A lawyer may be able to negotiate a reduced payment with the store and mitigate the risk of facing criminal or civil actions.

What Happens if You Don't Respond to a Civil Demand Letter?

Ignoring civil demand letters might seem like an easy option, but it's not advisable. Here's why:

  • Ignoring the letter could lead to a lawsuit, prolonging the issue and potentially costing you more in legal fees.
  • Judges and juries may view your disregard for the letter as a sign of disrespect for the legal process.
  • Your failure to respond could be seen as an admission of guilt or a willingness to violate the other party's rights.
  • By not addressing the letter, you may face additional penalties and increased attorney's fees.
  • In cases involving a "cease and desist" letter, ignoring it could result in a restraining order being issued against you, further complicating the situation.

Retail Theft Loss Statistics

  • In 2021, retailers faced significant challenges, losing a total of $93.9 billion in gross revenue to theft, marking a 3.41% increase from the previous year.
  • Shoplifting, classified as external theft, accounted for the largest portion of these losses, representing 37% of the total.
  • Statistics show that 9.09% of Americans engage in shoplifting, with juveniles aged 12-16 being the most common offenders, accounting for 1 in 4 incidents.
  • Over a five-year period from 2016 to 2021, 74.1% of retailers reported a rise in external theft.
  • Internal or employee theft contributed to 28.5% of retail theft, with 56.9% of retailers reporting an increase in such incidents over the same five-year period.
  • Process and control failures were responsible for 25.7% of retail theft, while 8.9% of losses were attributed to other or unknown causes.
  • Between 2019 and 2020, the dollar value of retail theft losses surged by 47.2%.
  • Additionally, the dollar amount lost per shoplifting incident saw a staggering 71.2% year-over-year increase.

Retailers lost a greater share of potential revenue to retail theft in 2020 than in any other year. Experts attribute some of the increased value of retail theft to currency inflation.

As stated by the 2024 Capital One Shopping Research [3].

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References:

1. https://capitaloneshopping.com/research/shoplifting-statistics/
2. https://www.thelaw.com/law/civil-demand-letters-retail-theft-and-recovery.415/
3. https://selfhelp.courts.ca.gov/form/demand-letter