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        Another AHBBO Article
        DBAs, TMs & .Coms

        "... 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 (an extract from an email I received from a new
        subscriber during the week) is a good illustration of how confusing
        the purpose of and difference between business names and
        trademarks can be for small business and others without ready
        access to an army of lawyers to lead them through the maze. 
        Add your domain name to the mix and it becomes as clear as
        mud.

        In this article, we'll look at what business names, trademarks
        and domain names are (and aren't), what you can and need
        to do to protect them and issues to think about when deciding
        upon what to choose for your business and domain names and
        whether trademark protection is appropriate (or even possible).


        YOUR BUSINESS NAME

        If you're going to conduct your business under a "fictitious"
        name, i.e., one other than its legal name, you will need to register
        the fictitious name 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
        U.S., the appropriate body may be some sort of government
        Department of 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 such as
        a corporation, limited liability company, limited partnership
        etc., the legal name of your business is the name of your
        corporation, company, or limited partnership.

        If you conduct business under your own name or that of
        your corporation, limited liability company or limited
        partnership, you do NOT need to register a fictitious business
        name with the State because you are not conducting
        business under a fictitious name, you are conducting it
        under your business's legal name.


        => Legal Purpose of a Fictitious Business Name

        The reason you must register a fictitious business name
        to operate a business under a name other than your
        business's legal name is to protect the consuming public -
        those members of the public who come in contact with your
        business - as well as other parties such as suppliers. 

        The purpose of registration is so that those who deal with your
        business 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 (i.e. it cannot enter into
        contracts in its own name).  A consumer wanting to do business
        with your business 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.  By searching the fictitious
        business names register, the consumer can find out who is
        "behind" the business, as that is the party with whom he or she
        will be contracting (and, sometimes, suing if the transaction
        goes bad!).

        Example:  Alfreda Smith conducts her florist business under the
        registered fictitious business name, "Blooming Right".  Florist
        Supplies, Inc. wants to enter into a contract with Blooming Right
        to supply Blooming Right's stock of tulips.  As Blooming Right
        is not a legal entity and only a DBA ("doing business as", another
        term for a fictitious business name), Blooming Right does not have
        legal capacity to enter into the supply contract with Florist
        Supplies, Inc..  (Florist Supplies, Inc., of course, being a
        corporation - as evidenced by the "Inc." - is a legal entity, and
        therefore has contractual capacity.)  For this reason, Florist
        Supplies, Inc. will only be prepared to contract with Alfreda Smith,
        the legal entity behind Blooming Right.  Florist Supplies, Inc.
        identifies the legal entity with contractual capacity by searching
        the fictitious business names register.  Accordingly, the supply
        contract finally entered into will be between Florist Supplies, Inc.
        and Alfreda Smith, d/b/a Blooming Right.

        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.

        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 is only designed to allow
        people who deal with your business to identify you as the person
        behind that particular business.  It doesn't give you exclusive use
        of that name for all purposes in all areas.  For this reason, if your
        business name is also your business's "brand", you should also
        register it as a trademark, if possible.


        TRADEMARKS

        As is evident from the purpose of registering a fictitious business
        name, a business name is NOT a trademark and 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).

        => What is a Trademark?

        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."
        (http://www.uspto.gov/web/offices/tac/doc/basic/basic_facts.html)
        A service mark is the same thing except it relates to the
        source of a service rather than a product.

        => Registration Not Required

        A trademark (or service mark) does not need to be registered
        to attain status as a mark i.e. 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 benefits not available if you rely only on
        your common law trademark rights, 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.  Imagine trying to satisfy a
        court that you are entitled to exclusive nationwide use of the mark
        if you've only been using the mark in two states.  Other benefits of
        federal registration include: (a) the fact that registration acts as
        constructive notice of your claim to the mark; (b) federal court
        jurisdiction can be invoked; and (c) registration can be used as a
        basis for obtaining registration in other countries.

        => What Can Be Trademarked?

        It may be easier to answer this question by looking first at what
        cannot be trademarked.  The U.S. Patent and Trademark Office
        (PTO) won't allow you to register a mark that is not distinctive
        (discussed below); 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 U.S. 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.

        => Distinctiveness

        As a general rule, a trademark must be distinctive in order
        to be accepted for registration.  This is an enormously complex
        issue in trademark law and beyond the scope of this article. 
        But for our purposes, just keep in mind that 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". 

        For example, let's say 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.  (Note though that certain types of marks while
        not distinctive YET may become so in the future, i.e. they are
        capable of acquiring a secondary meaning.  Such marks may be
        eligible for registration and limited protection on the supplemental
        trademark register.  For more on this, consult your attorney.*)

        (On the other hand, you may well be able to register the name
        Still Life as your fictitious business name provided the same or a
        deceptively similar name is not already registered in your county.)

        In order to maximize the chances of your trademark being
        accepted for registration, therefore, try to come up with a
        "coined" or "fanciful" name.  The example often given by
        trademark lawyers of a particularly successful coined name
        is Kodak.  It's a name that means nothing apart from its
        association with cameras and now expanded lines of
        products but is immediately identifiable by anyone who sees
        it as a trademark of the Eastman Kodak company.

        So, the more novel, unique and fanciful the name, the more
        likely you will be able to register it federally.

        DOMAIN NAMES

        So, how does your domain name figure into all of this?  In
        particular, what is the interrelationship between registered
        trademarks and domain names?

        => Domain Names VS. Trademarks : David VS. Goliath

        As a general rule, 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 against domain
        name holders even when the domain name holder acquired
        the domain name with perfectly innocent intentions, i.e. with
        no intention of infringing on the trademark or holding it for
        ransom (cybersquatting).

        => Domain Names AS Trademarks

        Let's say that the domain name you want to use is not
        already a trademark.  Can you register it as a trademark?
        Depends.  Maybe.

        A distinctive, coined domain name may well be capable of
        trademark registration for the reasons discussed above.
        An example is my own domain, ahbbo.com.  The word "ahbbo"
        has no common, ordinary meaning and so would most likely be
        capable of being registered as a federal trademark.  If I tried to
        register the trademark "A Home-Based Business Online"
        I would have trouble even though I own that domain name
        because the words are, in one variation or another, in
        common, ordinary usage.

        To be registrable, however, the domain name must act as
        a source identifier for the product or service offered by the
        business (simply because ANY trademark must identify and
        distinguish the source of the product or service), and
        not merely act as an address used to access a website.


        SUMMING UP

        Let's go back now and answer the original question:

        "... 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?"


        =>  "To protect myself and my business name from being
        copied and altered, do I have to register any and all variations
        of the name?"

        No.  The question misconceives the function and effect of a
        fictitious busness name.  The only function of the registered
        business name is to allow the consuming public and others,
        such as suppliers, to ascertain the legal entity behind the
        fictitious business name.  It is not the business's name that
        requires protection from being copied and altered, it is the
        business's trademark(s).  If you are looking to establish a "brand"
        with your business name, make sure the name is the same as
        your trademarks and register your trademarks.

        => "Do I have to register any and all variations of the name?"

        This was asked in the context of the business name.  For the
        reason just given, the answer is no.  But for the purposes of
        our trademark analysis, let's reframe the question.  Is it
        necessary to register any and all variations of the trademark?

        No.  Once you have federal trademark protection for your mark,
        the trademark examiner will (in theory, at least) not allow
        anyone else to register a mark that is identical or deceptively
        similar to your mark.


        STRATEGY

        If you're still in the planning stages of your business and
        haven't as yet registered a fictitious business name or decided
        on a domain name, stop and think.  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:

        1.  Trademark

        This is the most important of the three (i.e. business name,
        trademark and domain name) from the point of view of
        differentiating your product/service from your competitors'.
        So take your time and coin a mark that has no meaning outside
        of your product or service (remember the Kodak example) but at
        the same time try and make it suggestive of the product or service
        you offer.  Also, try and keep it short and memorable.  Yes, this
        IS a difficult task!  If it was easy, everyone would do it wouldn't
        they?

        2.  Domain Name

        The second most important of the three.  Once you've registered
        your coined trademark, register the same name as your domain
        name.  See the importance of making the mark suggestive, short
        and memorable?  Obviously, in the process of creating your mark,
        you should also check to make sure that the same domain name
        is available also.

        3.  Business Name

        The least important and easiest of the three.  Here, though, the
        suggestiveness of your trademark is more important.  Sure,
        registering a business name is only to allow others to identify the
        legal entity behind it but it's also the name that goes on your
        letterhead so it needs to have some sort of meaning relevant to
        the product or service that you're selling.  So when you're working
        on your trademark/domain name, make sure that, in addition
        to it being distinctive and memorable, it also suggests the type
        of business or product/service involved.  Naturally, when you're
        going through this process, also make sure the business name is
        available in your county.  Of course, 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 each of your business name, trademark and domain name
        you can establish your business in such a way that each element
        reinforces the others, thereby strengthening your brand.  Once
        you have a firmly established brand, your marketing efforts become
        a whole lot easier.  Promote the brand and you automatically promote
        the product/service you offer, and vice versa.

        There's no substitute for getting this bit right.  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, however, and this is
        one area where you should *definitely* consult your lawyer*.  The
        relatively small cost you spend at this stage will pay off BIG TIME
        down the track.

        _________________________

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        ** Reprinting of this article is welcome! **
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        Here's the resource box to use if reprinting this article:

        Elena Fawkner is editor of Home-Based Business Online. Best business ideas and opportunities for your home-based or online business.

        Copyright 1998-2017, AHBBO.com. All rights are reserved. Thursday, 21-Jan-2021 03:38:10 CST

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