How to Help Small Businesses Pick, Register and Protect a Name

During the course of working with clients, you’re often asked for business advice in areas outside the specifics of financial books and taxes. For example, a client may be starting a new business and wondering what’s the best way to name the business.

To that end, here are the key legal details associated with picking, registering and protecting a business name – so you can help your clients confidently navigate this important aspect of launching a business:

Picking a business name

There are numerous aspects that go into picking the right business name. From a marketing perspective, you’ll want something that’s memorable, easy to say, easy to spell, and conveys the business’ brand promise. From a legal perspective, it’s a little simpler: you need a name that’s available.

Before your client commits to a particular name and starts rolling out the business cards and letterhead, he or she needs to make sure the business name is legally available to use. There’s nothing more frustrating (and costly) than receiving a cease and desist letter because your business name is infringing on an existing business.

To avoid any trademark and naming trouble down the road, your clients should follow a three-step process for checking availability:

1. Check the availability of their business name in the state or states where they’ll be operating. This can be done by contacting the state’s secretary of state office to see if there’s already a business with the same name registered in the state. You could also have an online legal filing service handle this task for you. And, some services will even do this search for free.

2. Next, check the U.S. Patent and Trademark Office to determine if there’s an approved trademark or pending trademark application for your client’s proposed name in a similar capacity.

3. Lastly, if the first two searches conclude that the name is available, you should run a comprehensive name search, either through an online legal filing service or an attorney. This search will check if any other business is using the proposed name at a state or county level and didn’t register with the state as an LLC or Corporation and didn’t file for a trademark either.

If your client goes through these three steps, they can be assured that their proposed name is legally available and they can move full-steam ahead.

Registering a business name

There are two different ways to register a business name, depending on your client’s business structure plans. If your client plans to operate as a Sole Proprietor, then they can register their business name by filing a Doing Business As (DBA) with a local entity…usually the county.

A DBA, which is also called a Fictitious Business Name, is the way a Sole Proprietor can legally operate using a business name that’s different than their own name. For example, Jane Doe can file a DBA to operate under the business name Jane’s Landscaping. This step registers your name with the local county, city, or state office. And, since the DBA application also includes a publication in a local newspaper, this step also provides a public record of the business name and registration.

If your client is planning to form an LLC or corporation, then the LLC/corporation application registers the name with the state. Once the LLC/corporation paperwork is approved, your client has the legal rights to that business name in the state. Keep in mind that many states will also let you reserve a business name ahead of time so that no one else can register with the same business name. A reservation typically holds the name for 30-90 days until your client completes their LLC/corporation filing.

Protecting a business name

The ‘Picking’ and ‘Registering’ stages are both about keeping your clients out of trouble by making sure the name they choose is legally available and is properly registered so they can operate under the name. But, what about protecting the name so your client has exclusive rights to the name…either in their local area or across the country?

When someone registers as an LLC or corporation, this step protects the name at the state level. Once an LLC/corporation application is approved, no other business can register as an LLC or corporation with the same name in that state. That obviously provides some level of brand protection, but it doesn’t prevent another business from operating under the same name in any other state.

To ensure no other business can start using the same name in all 50 states, your client will need to apply for federal trademark protection.

Trademarks are granted to names, logos, and slogans by the U.S. Patent and Trademark Office (USPTO). The owner of a trademark has exclusive rights to the trademark and can prevent anyone else from using it. And, these rights are protected at both the state and federal level.

Starting fees for a trademark application are $275 per class; it’s a little more if you’ll have an expert prepare the application paperwork for you. Trademark applications are typically processed between six to twelve months.

One important tip: if your client does decide to apply for a trademark, they should make sure they’ve gone through the name search process as outlined in step one. This is because if they apply for a trademark and their proposed name is already in use by another business, their application will be rejected and they’ll lose their application fee.

Choosing a business name is a big deal, but it doesn’t need to be complicated. Just follow the steps for Picking, Registering, and Protecting a name and your client should avoid any infringement pitfalls and be able to use their name for years to come.