It’s Not Just a Branding Exercise

Selecting a name for your company requires searching federal and state trademark office resources

by Greg Crinion

Greg Crinion

In the early history of America, a business was identified with its owner.  Often times, the business name was the owner’s name, and the business was identified by a sign saying blacksmith, boot-maker, silversmith or the like.  With businesses now having an identity separate from their owners, an entire science (or perhaps art) has arisen for creating successful business names.  Innovative, creative, unique, personal – are all valid criteria for selecting a company name, but there are other considerations that should not be overlooked.

Common sense holds that a business should not use the name of a competitor.  A competitor will not accept someone using its name to compete.  Business names have value and any attempt to take or even confuse a competitor’s business name is improper and will likely result in a lawsuit for serious damages.  There is also the risk that the competitor was not worth copycatting – the Yugo brand has little value.

The globalization of business and the internet increase the risk of name confusion, even for businesses on different continents.  Selecting a business name entails online searches and research of global business databases, not just the local resources.  For example, Apple, Inc. defends its brand worldwide even if someone is only selling trinkets in Kemah.

Even businesses that do not compete should avoid using names that are similar to names of existing businesses.  After all, who would want to have piggy-backed on the name “Enron” or “WorldCom” and be branded with that name now?  Every penny of advertising, marketing and networking would been lost and re-branding would likely be cost prohibitive to overturn a negative image.

Businesses that use an assumed name or “Doing Business As” (dba) must file the assumed name with the county in which it operates.  This is true both for business entities using an assumed name as well as sole proprietors using a name other than the owner’s name.  The county clerk will usually check for other assumed names already in place in the county and will typically refuse to accept an assumed name filing that is the same as an existing filing.  However, it is wise to also conduct an independent search to assure no conflicts. Online searches for existing assumed names can be made at the websites for the Harris, Galveston and Brazoria County Clerks.

A business that wants to be legally organized as a corporation or limited liability company cannot have a name that is the same or “deceptively similar” to the name of another entity.  “Deceptively similar” is, of course, vague, and the Secretary of State has rules for making that determination.  The Secretary of State will refuse all such filings.  A search of the Secretary of State’s office for available business names can be made by telephone or online at www.sos.state.tx.us.gov.

A business entity cannot use a word or phrase that the business is not authorized to pursue.  For example, a business that is not an engineering firm cannot use “engineer” in its name.  While this sounds like common sense, it causes problems down the road for the company when disregarded.

Businesses may use trademarks in their business name.  “Coca-Cola” and “Exxon” are two such examples.  A business other than the Coca-Cola Company and Exxon Mobil Corporation, however, cannot use these trademarks in their business name.  Federal trademarks can be searched on the U.S. Patent and Trademark Office’s website at www.uspto.gov.  There are also state trademarks, although they are less common.

The road to selecting a business name is fun.  However, the way can be filled with potholes.  Thorough checking before starting the business can save time, money, effort and a great deal of angst in the future.

The County Clerk websites can be found at:

Harris County:

www.cclerk.hctx.net

Galveston County:

www.co.galveston.tx.us/County_Clerk

Brazoria County:

www.brazoriacountyclerk.net

 

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