What’s the difference between a company name and a trademark?

After much thought and with great excitement, you’ve come up with a name for your business.  You want to use it everywhere: as your business name, as your domain, on your website, on business cards, on packaging, maybe even on a bumper sticker.  Now how do you own it and protect it?  Is naming your company the same as branding your product? 

The straightforward answer is no.  There are two separate systems for registering business names and registering trademarks.  While the name that you use for your company and the brand that you put on your product may be the same word(s), the two are legally distinct - one is a company name and the other is a trademark.  While many companies use their company name as a trademark (for example, on a store front), the two are distinct in terms of their meaning and how they’re protected.  It’s important to understand the difference.

A Business Name

A business name often includes a corporate legal designation organized under the laws of a particular state, for example Your Company, Inc. or Your Company, LLC.  How a business is set up under your business name carries legal, personal liability, and tax implications.  Many business owners register their company name and form a business entity by filing the appropriate documents in the state or local jurisdiction where they will be conducting business.  Because different states have different rules about how close they’ll allow you to come to another’s business name, other business names may be very close to yours.  It is important to note that this type of business name registration isn’t intended to provide a business owner with protection against competitors; its purpose is to allow a business owner to do business in that state or locality.  Just because the state allows you to do business under that name, does not mean that another business owner - one who can show a likelihood of confusion with their trademark - could not stop you from using your business name.  Such protection is a matter of trademark law.

A Trademark

A trademark is a word, phrase, or design which identifies the source of goods or services and which is used in commerce.  It is what distinguishes your products or services from others in the marketplace.  A trademark can appear on labels, hang tags, or signage for products or on advertising, a website, or brochures for services offered to the public.  (A trademark and a service mark serve the same function, the latter just applies to services rather than goods.)  In the U.S., rights in a trademark can accrue through use in commerce.  Additional protections may be acquired by filing a trademark application with the U.S. Patent & Trademark Office (USPTO), a state trademark office, or a foreign trademark office.  Trademark rights are territorial, which means that protection is only afforded in the geographic region of use or if you have a registration, in the territory covered by that registration.  When you either (a) are using a name, phrase, or logo with the intention of using it as a trademark; or (b) have filed a trademark application with a state or federal trademark office, you may use the "TM" symbol.  Only when you have registered your trademark with a state or federal trademark office, may you use the Ⓡ symbol. (See my blog regarding the use of trademark symbols.)  Once you establish rights in your trademark, you have a basis for preventing others from using the same or similar trademarks for the same or similar goods/services.

Way forward

When choosing company name, research your local business laws and consult your accountant and/or a small business lawyer.  When choosing a trademark, consult a qualified trademark lawyer.  While many lawyers hold themselves out as trademark specialists, trademark law is a distinct field where the advice of an expert will save on costs and prevent headaches down the road.

Still wondering how this applies to you and your business?  Click here to discuss.