I received a call a few weeks ago from a business owner seeking advice because a competing company in the same geographic area changed its name and adopted a name that was virtually identical to the prospective client’s business name. The caller did not understand how that could happen since their business was properly formed as a LLC and the appropriate assumed name certificate was filed with the state.
It is commonly thought that a company’s corporate name or filed assumed name protects the company from others using the same or similar name. That, however, is not the case. While the selection of a corporate name will generally prevent others from forming a company with the same or similar name in the state of formation, the purpose is not to protect from unfair competition. The purpose is to give notice to the public of the proper company to sue if something happens that gives rise to a potential lawsuit, and the identity of the person who can be served with court papers on behalf of the corporation, LLC or other business entity. Similarly, the purpose of filing an assumed name is to provide notice to the public of what company is using that name to conduct business so if any disputes arise the proper company can be sued if necessary.
The question then becomes, “How do you protect your business name and identity from unfair use by others?”
First and foremost, register your business name and logo as a trademark. Obtaining appropriate trademarks gives you the exclusive right to use the name and logo in connection with the class of goods or services for which the name and logo are registered. Once registered, routinely search for violators, and take the action necessary to protect your marks. A registered trademark can be relatively easy to enforce on a national level if the need ever arises.
Second, copyright brand and product images, brand aesthetics, and brand colors. This helps protect you from counterfeiters and others using your branding aesthetic to unfairly compete for your business. Copyright protection is valid in over 100 countries under the Berne Convention.
Third, make your branding distinctive and memorable. Often called “trade dress,” the style and appearance of your branding is important so that a distinctive and uniform image is portrayed for your business in your website, social media accounts, advertisements, stationary, and other materials. Infringement of a company’s trade dress is enforceable, and claims of “trade dress” infringement are often brought together with trademark violation claims.
Finally, purchase all domain extensions for your website name so that it is less likely for a competitor to do so. If your competitor acquires the .net extension of your domain name, for example, visitors to the .net URL can be redirected to the competitor’s website. This can also protect your from cybersquatting and type squatting.