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"... I'd like to register my business name with the proper town authorities as a sole proprietorship.  To protect myself and my business name from being COPIED and altered, do I have to register any and all variations of the name?  And is this done separately or is it done under the one application? ...  Is this what I need to do in order to stop anyone from using a variation of my business name?  And can my business name be trademarked along with its variations?" This question is a good illustration of how confusing the PURPOSE of and DIFFERENCE between business names and trademarks can be for small business.

So what's your "legal" name? If you're conducting business as a sole proprietorship, your legal name is YOUR name, i.e. Fred Smith. If you're any sort of other legal entity, the legal name of your business is the name of that ENTITY -- of your corporation, company, or limited partnership. In either of these instances, you do not need to register with the State because you are conducting business under your company's legal name. If you're going to conduct your business under a FICTITIOUS name, you will need to register it with the appropriate government agency in your state. This usually means your local county recorder's office but, depending on where you live, it may mean your state's Secretary of State Office. In countries other than the United States, the appropriate body may be some sort of government Department of Small Business.

The reason you must register a fictitious business name is to protect those who deal with your business -- so they can search for and identify the person(s) “behind” the name. As a fictitious business name is not a legal entity, it does not have CONTRACTUAL capacity. A consumer wanting to do business with you needs to be able to verify that the person with whom he or she is contracting has authority to enter into the contract as the business entity. You should also know that you won't be able to open a bank ACCOUNT for your business unless and until your fictitious business name is registered with the state. And just because you've registered your business name in your county doesn't mean that someone else can't register the same business name in another county. Registration doesn't give you EXCLUSIVE use of that name for all purposes in all areas.

A registered business name will generally not operate to PROTECT the name from use by others (except as an identical or deceptively similar business name in the same county). So how do you protect your business's "name" if it also identifies and distinguishes the source of your goods or services from those of your competitors'? The answer is federal TRADEMARK registration. Although you can also register trademarks at the state level, state registration confers only limited benefits and should be considered only if federal registration is not possible.

As suggested above, a trademark is either "a word, phrase, symbol or design, or combination of words, phrases, symbols or designs, which IDENTIFIES and distinguishes the source of the goods or services of one party from those of others". A SERVICE mark is the same thing except it relates to the source of a service rather than a product.

A trademark (or service mark) does not need to be registered to attain STATUS as a mark -- unregistered trademarks are recognized by the common law. If you have used a distinctive trademark that you own in commerce, then you probably have a common law trademark already. But registration confers other benefits, such as the presumption that you are the owner of the mark for the goods and services specified in the registration and the entitlement to use the mark NATIONWIDE. Absent federal registration, you would have to prove these things in court as preliminary questions of fact. Other benefits of federal registration include:
  • the fact that registration acts as constructive notice of your claim to the mark

  • federal court JURISDICTION can be invoked

  • registration can be used as a basis for obtaining registration in other countries

It may be easier to answer this question by looking first at what cannot be trademarked. The United States Patent and Trademark Office won't allow you to register a mark that is already in use or that contains names of living persons without their consent; the United States flag; other federal and local government insignia; name or likeness of a deceased United States President without the widow's consent; words or symbols that DISPARAGE living or deceased persons, institutions, beliefs, or national symbols; and marks that are judged immoral, deceptive, or scandalous.

As a general rule, a trademark must be distinctive in order to be accepted for registration. This is an enormously complex issue, but a mark that is in ORDINARY or COMMON usage in the community will not be capable of registration because no one person can be said to be the "owner". If your business is selling still life paintings. You would have trouble registering "Still Life" as a trademark because it is a term in common usage and has a general meaning in the community. But you may well be able to register the name Still Life as your fictitious business name. In order to maximize the chances of your trademark being accepted for registration, try to come up with a FANCIFUL name. A particularly successful coined name is Kodak -- it's a name that means nothing apart from its association with cameras.

As the law presently stands, it is possible to register ANY domain name that isn't already taken, without regard to whether that name is a trademark owned by a third party. But do so at your peril. Courts are increasingly siding with trademark OWNERS even when the domain name holder acquired the name with perfectly innocent intentions, i.e. with no plans to infringe on the trademark or holding it for ransom (CYBERSQUATTING).

Can you register a domain name as a trademark? A distinctive, coined domain name may well be capable of trademark registration. To be registrable, however, the domain name must act as a source IDENTIFIER for the product or service offered by the business, and not merely act as an ADDRESS used to access a website.

Now's the time to make some pretty crucial decisions about the future protection of the intellectual property of your business. Here's the sequence I recommend:
  • First Step: Trademark -- the most important step for differentiating your company from your competitors (make it short, memorable, and SUGGESTIVE of the product or service you offer)

  • Second Step: Domain Name -- once you've registered your coined trademark, register the same name as your domain name (in creating your mark, you should check to make sure that the same domain name is also AVAILABLE)

  • Third Step: Business Name -- the least important and EASIEST of the three (by conceiving a coined name, you're almost guaranteeing that it won't already be taken)

Hopefully you can see that by thinking through the INTERRELATEDNESS of the three, you can establish your business so that each element reinforces the others, thereby strengthening your brand. Do it right first time and you won't have to waste time and resources two years from now trying to bring your name, your trademarks and your domain names into line. The legal issues can be complex, and you should definitely consult your LAWYER. The relatively small cost will pay off big time down the track.


Elena Fawkner is editor of A Home-Based Business Online ... practical ideas, resources and strategies for your home-based or online business. Visit her website at www.ahbbo.com.

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