A cease and desist letter isn't a legally-filed lawsuit unless and until you receive and are served with a summons and complaint as well. You can respond in writing stating that you won’t stop the alleged actions and explaining why, but this will almost certainly result in a lawsuit and a judgment against you if you don't defend yourself. You might also file a lawsuit yourself seeking a declaratory judgment, asking the court to state on the record that you haven’t infringed on anyone’s rights.