Business Names and Trademarks
Business owners must resolve a number of considerations concerning the legal names that attach to their businesses. The following is a primer on the basic distinctions regarding the various names and trademarks a business might use.
Every form of business ranging from a small sole proprietorship to massive publicly held multi-national corporations has a company name. The company name is the legal name under which the business enterprise conducts business.
In Michigan, sole proprietorships and co-partnerships may but need not register their business and company name with county authorities. Limited Partnerships, Limited Liability Companies, and Corporations all register their names with the State of Michigan Department of Licensing and Regulatory Affairs. All states in the United States have similar agencies that register such companies or certify “foreign” companies formed in other states to conduct business in that state under the company name.
The company name must be distinct within the state it is conducting business within. For example, a company desiring to call itself “Smith Enterprises, Inc.” would be unable to use that name in Michigan (as of the writing of this article) because state records show that name has been taken since 1983. The resourceful entrepreneur may, however, slightly change the desired name to gain approval. In our example given above, the name “Smith Enterprises of Leelanau County, LLC” was approved 20 years after the first “Smith Enterprises” name was registered, despite the fact that the first two words of both names are identical. The added words were obviously deemed by state authorities to make the second company name sufficiently distinct from the previously registered company name.
Once the business acquires a company name in Michigan it is entitled to keep that company name as long as its business remains in good standing.
Assumed names (a/k/a DBAs) are distinct from the company names described in the previous section, in that assumed names are not necessarily the legal name assigned to the enterprise. A company may register one or more assumed names with the state authorities for use in its activities. A business enterprise may desire to keep its company name and public persona separate through the use of an assumed name that promotes its products or services.
For example, an enterprise called “ABC LLC” that sells widgets may desire to be known as “The Widget Store.” That company could register the latter name as an assumed name, as long as the name is available for registration.
As is the case for company names, an assumed name must also be distinct within the state it is located within. The same rules cited above for company names apply to assumed names. An assumed name may be the same as the company name, and may even be registered as a trademark.
A trademark is a word, phrase, logo, or other graphic symbol used by a manufacturer or seller to distinguish its product or products from those of others. Black’s Law Dictionary, Eighth Edition, p. 1530. Unlike the company name or assumed name, the primary purpose of the trademark is to designate the company’s goods or services.
The most effective trademark is a registered trademark. Once a registration certificate is issued by the federal or state authority, the trademark owner enjoys constructive notice that it owns the trademark, a legal presumption of ownership, and the exclusive right to use the registered trademark in connection with the designated goods or services.
The preferred venue for registration in this country is the United States Patent and Trademark Office (USPTO). Once registration with the USPTO is complete, the benefits noted above apply nationwide. The owner of a registered trademark is entitled to label this trademark with the federal registration symbol “®”. The owner may bar others from use of its trademark, sue in federal court for any alleged infringement of that trademark, and recoup damages and attorneys’ fees in the process. This registration also gives the trademark owner a platform for registering the trademark internationally.
A trademark owner may register the desired trademark with the state or states in which the business operates. Such registration is usually considered alternative to federal registration, since that procedure has the same effect on a nationwide basis. The effect of such registration is similar to that of federal registration, reduced to the limited state-wide territory and different enforcement venues.
The owner of a distinctive mark, symbol or device may acquire a “common law trademark” without attempting or achieving registration thereof. The trademark owner gives notice of its claim to a common law trademark by attaching “TM” to the trademark. The common law trademark lacks the impact and enforcement firepower of a registered trademark, but nonetheless offers some legal protection to its owner. The owner of the common law trademark can sue for infringement of the mark, but must prove the prior adoption and use of that mark in the affected service territory, and suffers other limitations to its enforcement rights not presented when the trademark is registered.
The trademark owner who has applied for but not received registration (the process normally takes more than a year with the USPTO) still enjoys the protections afforded the common law trademark until the registration is filed and complete. Once the registration is complete, the attendant legal rights will date back to no later than the application date.
Those are the basics. If you have any further questions or legal needs with respect to business and trade names, do not hesitate to contact us.
Caution: This article provides general information and is not intended to be legal advice. Your personal circumstances likely vary from those discussed in this article. You should contact Lambert & Lambert PLC if you are seeking specific legal advice regarding the topics discussed above.
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