What will happen is that they will send a cease and desist letter to you (like they did to Pete). At that point, you have basically given notice and it becomes much riskier to continue doing what you're doing.

That's not to say their C&D is valid or enforceable. It just enters into another legal bin that's a bit more hairy.

Unfortunately, the legal precedent for all this is murky at best. Past cases have been very specific to the details of those cases. No line has ever been drawn about what is ok and what is not.