“A rose, by any other name, would smell just as sweet,” crooned star-crossed Romeo to Juliet in the memorable line from the play.
But it would definitely not be sweet would be to wake up to ads by a new competitor that is using a name extremely similar to your company’s name.
You might then realize your business’s name has never been trademarked, that the new business is operating in exactly the same geographic area, and is now interfering with Google search results of your company’s name. Now things may start to look a little more grim. Is there anything that can be done?
Legal Names vs. Trade Names
As many businessowners already know, company can have both a legal name and a trade name. The legal name of the business is the name under which the business is registered with the secretary of state. That name can be different from the business’s trade name, which is the name that everyone knows the business by, or the name it uses for marketing purposes. For example, Bayerische Motoren Werke (Bavarian Motor Works) is generally known as BMW. Trade names are not only used by companies who want to do business under an easier, shorter, or catchier name, but for large companies that are involved in a variety of products, goods, and services, in different industries. Finally, trade names are also used by sole proprietors who are not formally incorporated and want to do business under a business name.
Protecting Trade Names
Contrary to popular belief, there is no federal protection for trade names in the same way that there is for trademarks, copyrights, or patents. A trademark is different than a trade name, which is a name that is used by the business for commercial purposes. For example, the Burger King “Whopper” is a great example. Burger King may not be able to trademark the right to use the word “Burger” as part of its Company name because it is a descriptive term, but its various sandwich names, logos, etc., are trademarked. A trademark can be a name or logo, but denotes a particular good, product, or service that is often adorned with the mark. If a company name has been or is capable of being trademarked (and not all companies may be), then the trademark right would give the trademark holder the right to prevent others from using the same mark in commerce. But the reality is that many company names are not trademarked or may not be trademarked because they do not qualify under the standards required by the U.S. Patent & Trademark Office.
What Can Be Done?
So what can be done to protect a trade name? Business owners generally have a few different options.
- Common Law Rights. Even if your company does not have federal trademark protection, all is not lost. Common law rights allow a business that has been using a business name in connection with its business to protect its name. Leaving out nuanced legal jargon, generally the law evaluates: 1) how long the mark has been use, and when it was first in use; 2) the geographic areas of the use; 3) the “commercial strength” of the mark; 4) whether the mark causes “consumer confusion,” and 5) whether the mark has acquired a “secondary meaning,” which refers to whether consumers in the geographic area in question would associate a new product or service with the business in question. For example, if Godiva chocolatier began manufacturing a dog-treat called “Dogiva” that used the same brown and gold packaging as Godiva chocolate treats, would an ordinary consumer assume that it originated from Godiva? If yes, that is a pretty good indicator that the “Dogiva” mark causes consumer confusion.
- Trade Dress. If the competitor business is selling or marketing a product using designs, colors, packaging, or dressing that is similar to the company’s, then trade dress protection may also be available. Trade dress does not refer to the functionality of a product, its quality, or how it works – only how it is packaged and dressed up. A great example is pink fiberglass insulation used by the manufacturer, Owens-Corning. Making fiberglass insulation the color pink serves no purpose and has nothing to do with the functionality of the insulation, and may even add to the costs of producing it…but the color pink is used by Owens-Corning to distinguish its products from others, and has obtained a number of registrations for the color pink on its products.
- Unfair Competition. Business owners can also use unfair competition laws to prevent a consumer from “passing off” goods and using unlawful, fraudulent, or false means to unlawfully compete with the company.
If a competitor is using your company’s name (whether intentionally or unintentionally), the starting point should be to have a cease and desist demand issued promptly to the perpetrator. Cease and desist demands are often sent not only to notify the perpetrator of their potentially infringing conduct, but to also make the case for statutory penalties or punitive damages if the matter proceeds to a lawsuit, to help prove that the competitor was notified of the unlawful conduct but continued on anyway. Many cease and desist demands tend to be 1 page or 1-2 page letters that simply tell the perpetrator to stop doing X or Y “or else.” These types of letters are not always effective though – as vagueness can sometimes make it seem as though there is not a lot of substance to the demand. Long, detailed, and fact-specific demands, that include lots of information about the length and pervasiveness of the company’s use, its marketing, advertising, and promotions efforts, etc., can go a long way towards making it clear to the other side that they are in violation of infringement laws.
If your company name has been taken, misused, or if another company is using the same name, it is important that you contact legal counsel immediately. AXIS Legal counsel represents victims of trademark, trade name, trade dress, and other intellectual property infringements, including violations of state and federal trademark laws, unfair competition laws, and others. AXIS Legal Counsel represents individuals, businesses, startups, and entertainers in a wide variety of intellectual property disputes, including copyright infringement, copyright litigation, trademark infringement litigation, trade dress infringement, patent infringements, cyberlaw, counterfeiting, trade secret litigation, and intellectual property disputes involving film, music, fabric, fashion, software, apps, websites, merchandise, products, and various others. Our Intellectual Property Rights Practice helps clients protect their ideas, inventions, and works of authorship from unlawful infringement. AXIS Legal Counsel offers aggressive representation to copyright, trademark, patent, and other intellectual property rights holders involved in infringement or intellectual property disputes, whether connected to the entertainment industry or technology sector. AXIS assists clients in applying for intellectual property protection as well as litigating disputes, including copyright litigation, copyright lawsuits, non-solicit agreements, non-competes, trade secrets, cyberlaw, intellectual property, and others. Axis’ managing attorney Rabeh M. A. Soofi is ranked as one of the “Top Women Lawyers of Southern California” by SuperLawyers Rising Stars, and counsels clients in need of a Los Angeles Intellectual Property Attorney.
For information on retaining AXIS Legal Counsel to represent you in connection with any intellectual property dispute, contact firstname.lastname@example.org or call (213) 403-0130 for a confidential consultation. AXIS Legal Counsel serves clients throughout Los Angeles and California.
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