Introduction To Corporate Names
I often inform people that the most valuable business asset they have is quite frankly their name. Why? Your name is what enables your customers to identify your products and / or services and generally businesses promote their names any way they can because they unconsciously know that their viability hinges on their intended customer's recognition and positive association of the name. Yet, new business owners often fail to to prepare clear company directives as to how to best select, use and protect the business and / or product names. The proper selection, use and protection of business names first requires a clear understanding of the differences between trademarks, corporate (limited liability company and partnership) names, and trade names (also known as d.b.a.'s and fictitious business names).
Basic Differences Between A Trademark and Company Name (trade name)
The trademark, company name, and trade name each have separate meanings, rights and registration requirements. Moreover, although a company may use the same name as a trademark, corporate name and trade name, more often than not this is not the case. For example, assume company A uses the corporate name, Legal Corner, Inc. When the company engages in business it generally will use the shorter name Legal Corner on its letterhead and invoices. In this example, the corporate name is Legal Corner, Inc. and the trade name is Legal Corner. The same shortened name, Legal Corner, may also be used in its advertisements for its services. This use is considered the company's service mark (trademark had the company sold products). In addition the company may engage the use of a slogan in its advertising promotions, such as "Small Biz Legal Resources @ web speed", which may also be a separate service mark. Moreover, if the company creates, promotes, markets, and distributes a How-To Book that it has packaged in a unique manner, the packaging of the book may be protected as trade dress (another form of trademark protection) and the book itself may be subject to copyright protection.
The remainder of this article focuses on the differences between trademarks, assigned corporate (limited liability and trademark) names, and trade names. Each of these categories denotes a separate type of use that carries with them different registration requirements and protections.
Trademarks, Service Marks and Trade Dress ("Trademark")
A trademark, or service mark, is a brand name or slogan. It can be a word, name, symbol, device, phrase, slogan, logo, sound, or any combination thereof whose primary purpose is to identify a product or service and distinguish it from those of another. For simplicity sake, we will refer to these items as a "trademark". When a trademark refers to a product it is called a trademark. When it refers to a service, it is called a service mark. When it entails a product's non-functional packaging, shape, and/or appearance it is called trade dress. Trade dress can be protected as either a trademark or service mark, depending upon whether it is used for the sale of goods or the providing of a service.
For a mark to be registrable at either the state or federal level, however, the mark must be used in commerce and either distinctive or famous.
Corporate, Limited Liability Company and Partnership Names
A corporate, limited liability company or partnership name (Collectively referred to as a "Company Name") is the legal name of an business entity, be it a corporation, limited liability company, or partnership. Most states not only permit, but often require, the registration of some, if not all, Company Names. The state agencies assigned the duty of approving the use of Company Names are merely concerned with determining whether or not there are two identical conflicting Company Names within the pertinent state registry. The fact that a state agency allows you to use a Company Name for your corporation or limited liability company does not mean another company owning the trademark to the name, or a confusingly similar trademark, cannot stop you from using the name to promote or sell a competitive product or service. For this reason you should not attach any trademark significance to a state agency's approval of a Company Name. We therefore strongly recommend that a trademark search be conducted before any proposed Company Name is actually used to register and organize the relevant entity. Such a search can be conducted by any of the well-known trademark search firms, and should be analyzed by a competent attorney who will then provide the client with an opinion on the feasibility of its use.
Trade Names (also known as fictitious business names and dba's)
A trade name is any name used by a business that differs in any manner from the full legal Entity Name. Such as the use of Legal Corner (Trade Name), instead of Legal Corner, Inc. (Corporate Name). This is usually the name a business (including a sole proprietorship) uses on its letterhead or invoices. Registration of a trade name is generally accomplished by filing a fictitious business name statement (d.b.a.) at the county level (although some states and counties do not permit registration). Like Entity Names, the county's acceptance and registration of a trade name does not confer any ownership rights. The fact that the county agency allows you to use a trade name for your business does not mean another company owning the trademark to the name, or a confusingly similar name, cannot stop you from using the name to promote or sell a competitive product or service. We therefore strongly recommend that a trademark search be conducted prior to any use or registration. As stated above these searches can be arranged for by a competent attorney who should review and analyze the search and provide you with an opinion on the feasibility of the selected name's use.
Conclusion
Naming your business and product or service may be one of the most critical steps you take when starting a new business, or begin offering a new product or service. Likewise failure to do so properly can be a great hazard. We strongly suggest now that you know the differences between trademarks, Entity Names, and trade names, that you have a competent attorney arrange for a trademark search on any name(s) you pre-select.
