If I choose a business name that's similar to another business, can they demand I stop using their name?
Can another business ask me to stop using a business name that is the same or similar to theirs? I don't want to list the actual names here for legal reasons. Let's say I open a photography studio and name it StrobeOne Photography. I take care of the legal stuff with the county clerk's office, do the paper work and get a DBA, then I open a bank account in the business name. I have all the business licenses and everything required to open my studio.
Several months pass and one day I get an offical looking letter from StrobeOne Studios in a neighbouring state just across the state line ordering me to cease and desist from any further use of their name. They are a highly elite and sought after sudio, this is a place where you drive hundreds of miles and expect to pay $3,000 and up for senior photos. In the letter it says people looking for them stumble on my website by mistake and my cheap prices along with my inferior quality work is hurting their business and reputation. The letter goes on to say that I have 30 days to stop using their trade name and if I haven't sent them sufficient proof that I have stopped using their name in 30 days, appropriate legal action will be taken.
I know locally we have Jones Insurance and Jones Real Estate, each owned by 2 different people. We also have Jim's Hardware, Jim's Computer Repair and Jim's Car Wash, each owned by a different Jim. So if I use my first name, no matter how common, they can't tell me I need to change my name, but if I call it Circle N Photography, Circle N Ranch could say I stole their name? I tried to research available names but this place didn't come up and the name is slightly different than mine, also we market to different people.
I'm just getting started in this, rent a studio and currently only make enough to cover the studio fees. I only have a couple hundred in my business account and spent down my personal savings buying equipment. My camera, lenses and other stuff I own is about $4,000. Other than my house and car, that's about all I have and I don't know if I could get enough back from selling it to pay for a lawyer.
My big questions are, can they really make me stop using their name? can they sue me if I continue to use it? and how much could they sue me for?
I'm trying to figure out the legalities here because I work a full time job and just do this by appointment evenings and weekends. My business itself has nothing at this point and my employer said they could come after me personally and take my house and car. Could they really do that?
- 8 years agoFavorite Answer
The question is: Did they trademark StrobeOne Photography? Is that too similar to Studios? Hmmm...
A business must register the name with the Secretary of State and, as long as it is distinguishable from any other business name within the state, the business will be recognized under that business name and no other business can use that name within that one state. A trademark on the other hand is not a name, but property. A trademark is generally used to brand a certain good or service and has a value in of itself. For example, imagine a well built car with no markings.
Is protecting my Name different from a trademark?
There's a short answer and a long answer to this question. Let's start with the short answer. The business name is simply that, a name, a way to identify a business, entity, or individual. Due to the potential value of a trademark and the inherent property rights entailed within a trademark, the application for a trademark is much more complicated. Trademarks are registered under the federal government through an application process that can last over six months. The property rights of trademarks can be enforced by both the federal government and by the states.
Now for the long answer. The business name is limited to the state. States have differing laws on how different the name must be from other business names within the state. Some states have very loose laws and say the name has to be unique and easy to identify (e.g., filing of "Transamerica Airlines, Inc." was acceptable even though the name "Trans-Americas Airlines, Inc." was already in existence). Other states impose strict guidelines that restrict names from being "deceptively similar" to prevent unfair competition (e.g., filing of "Transamerica Airlines, Inc." would be too similar to "Trans-Americas Airlines, Inc." that would confuse consumers on which corporation is which). However, the business name does not need to be different from business names in other states. In fact, a corporation can do business in another state where its business name is being used by another company by registering for a "dba" (doing business as) or Assumed Business Name or trade name (depending on the state). Most important to the distinction between a business name and trademark is the fact that a corporation can conduct business with the same name of another existing business. Registering the business name with the Secretary of State merely protects that name from being used by another business within that state, but not in another state.
Trademarks, on the other hand, are property. Similar to any other tangible property, the owner of a trademark has the exclusive rights to the trademark and can prevent another individual from using the trademark. A trademark is also not limited to a business name but can also include a phrase, logo, symbol, design, image, or a combination of these elements. As mentioned above, this mark cannot be similar to any other trademark. A mark can use the same words as another mark, as long as the marks are not deceptively similar. By simply changing the font, the font color, or by adding a different image, the mark may be trademarked by the federal government (e.g., compare Apple, Inc. with Apple Corps Ltd.). However, the trademark cannot tarnish the value of another trademark or blur the consumer's perception of the trademark with another. Because trademarks include exclusive rights to the mark, the application process is more complicated. After applying to the U.S. Patent and Trademark Office, the trademark undergoes an examination period that can last over six months. Once all procedural and substantive issues are resolved, the trademark is then placed in a 30-day waiting period where third-parties have the opportunity to challenge the trademark through an Opposition Proceeding. If no challenge to the trademark is substantiated, the trademark is officially registered. Unlike copyrights and patents, trademarks have an unlimited lifespan.
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- Dan HLv 78 years ago
Yes, they can ask you to cease and desist.
You then have a choice to comply with their wish or defy their request.
If you decline to change your business name, the ball is back in their court and they can take you to court. They will demand that you are using their name to further your business and potentially damaging their brand by using a likeness of their business. You are trying to prove that the laws don't apply and that your business is not in their sphere of influence.
The judge will decide.
You have to decide whether it is cheaper to find a new name or fight in court against a larger pocketbook a case which you have less than 50% chance of winning.
At this point you have a cease and desist letter and little invested in the business. It won't take that much to change your business name and you get them off your back by sending a polite letter back saying that you were unaware of their presence, you understand that the names are too close and you will be changing your business name. Your legal problems go away and you can do some closer research to find a new business name.
- MelanieLv 45 years ago
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As long as they have not trademarked the name for use in YOUR state, there is no conflict. Just avoid doing anything that can be construed as trying to fool people into thinking our companies are linked. Many many many companies share a name. As long as there s no risk of confusion, it's allowed