When developing a business name, not only should the business name reflect its brand and be memorable, but there are a host of legal issues to consider. Also, choosing a business name that is capable of trademark registration
is very, very important.
Business Name Clearance
Business names may or may not require a search. In most cases, the business will use its name in dealing with the public or others in the trade. Such business names should be searched in much the same way that a trademark or trade name would be searched. Moreover, if a business chooses to use a DBA (assumed or fictitious business name (doing business as)) different from its registered business name, the DBA business name will also require a search.
However, in situations where the business name will never be used when dealing with the public or the trade, there is little chance that the business name would cause confusion with another business name in the marketplace. In such situations, there is generally no need to conduct a business name (trade name and trademark) search.
Additionally, business names require a second type of search which is separate and distinct from the trademark search
. As a general rule, a business name must also be cleared or reserved with the Secretary of State's Corporations Office in the state where the business will be incorporated or organized, and in each state the business will conduct its operations. Note that the Illinois Secretary of State's Corporation Office determines only whether a business may be formed under a given business name, it does not determine whether the business name can be used in the marketplace.
Choosing A Name Capable of Trademark Protection
There's considerable controversy over how to choose the best name for a business. Some business consultants believe that the best names are abstract, arbitrary. Others believe that business names should be informative, so consumers and potential clients know immediately what the business is.
Generally, the more unique or distinctive the business name is, the greater trademark protection it achieves. See: Trademark Law Overview.
Thus, choosing a distinctive name is an important strategy for many businesses.
Remember, a descriptive name can only receive trademark protection
if it acquires secondary meaning. For a business using a descriptive business name to acquire secondary meaning is very, very difficult and usually comes at a substantial cost. Also, terms that describe a geographic location of a good or service, like the Chicago Tribune
, are considered descriptive, and they can only be protected upon proof to the USPTO that they have acquired secondary meaning.
Trademarking A Business Name
Not every business needs to trademark its business name. Generally, for most local businesses, as long as the Secretary of State allows the business name to be registered, the business may operate under that name without applying for a trademark; assuming, of course, the business name isn't infringing on another businesses trade name. That said, even small businesses should at least consider having its business name screened. If the business starts out as a local business but intends to expand, a trademark search and trademark registration should be considered. Ensuring that a business name is going to be federally registerable is most often times highly advisable.