Not the same beastie
Yesterday’s blog post about state trademarks prompted a flurry of reader questions, particularly from those who live in states where registering a state trademark is either expensive or complicated (or both). “It will cost me an arm and a leg and the few hairs I have left on my head to register a trademark where I live,” John wrote, in a typical inquiry. “But I can register a trade name quickly and for a lot less money.”
No. And no again.
A registered trademark is a form of legal recognition of your right to use a particular “word, phrase, symbol or design, or a combination of words, phrases, symbols or designs, that identifies and distinguishes the source of the goods of one party from those of others.”1 There’s also a type of trademark called a service mark which does the same thing for services, rather than goods. The term trademark includes both.
A trade name, on the other hand, is nothing more than the name you choose — other than your own individual name — for your business. The U.S. Small Business Administration (SBA) explains: “a trade name is the official name under which a company does business. It is also known as a “doing business as” name, assumed name, or fictitious name.”2
There’s a good explanation of these three at the Hawaii Business Registration Division website:
Each of these terms does mean something different and while there are gray areas, it is easiest to see trade names as relating to businesses or entities and trademarks and service marks as relating to the products of businesses or entities. If your product is goods, you would be applying for a trademark. If your product is a service, you would be applying for a service mark. For example, DCCA, Inc., a corporation, or DCCA Co., a partnership, has registered a trade name “DCCA Manufacturing Co.” The corporation or partnership might also apply for registrations for its “DCCA Widgets” (trademark) and for its “DCCA Widget Maintenance” (probably a service mark).3
And the legal protections given to trademarks or service marks on one hand and trade names on the other are also very different.
A trademark (including a service mark) gives you the legal right to go to court to stop everybody else from using the same “word, phrase, symbol or design, or … combination of words, phrases, symbols or designs” to identify their businesses wherever you have that trademark registered. The U.S. Patent & Trademark Office notes that registering a federal trademark gives you “the exclusive right to use the mark nationwide on or in connection with the goods/services listed in the registration.”4 The SBA adds: “Registering a trademark guarantees exclusive use, establishes legally that your mark is not already being used, and provides government protection from any liability or infringement issues that may arise.” 5 A state trademark or service mark works exactly the same way, but only within the borders of the state(s) where you have it registered.6
A trade name, however, is something only the states worry about, and they worry about it usually because they want to be able to find (and to tax) the person or persons behind the curtain of the trade name. Some states require trade name registration; some make you register with local or county governments; some don’t require it at all. The SBA has links to all states where you can check the rules where you live.
But because the trade name registration is more to protect the public and the tax collector, and not so much to protect your business, in general, “A trade name does not afford any brand name protection or provide you with unlimited rights for the use of that name.”7 Read what just a few of the states have to say about trade names:
• Colorado: “A trade name provides notice that you are using that trade name, but does not prevent anyone else from using the same name.”8
• New Jersey: “the registration of the alternate name will not provide exclusive rights to its usage.”9
• Ohio: “a fictitious name provides no protection because other registered names are not required to be distinguishable…”10
• Washington: “Registering your trade name does not protect the name from use by others.”11
Now it’s true that in many states, if you register a trade name and someone comes along after you and uses the same name, you can sue them for unfair competition or under the notion of common-law trademark. But it’s a tough row to hoe: you have to prove you were the first to use the name, you have to prove you were damaged by the other person’s use of the name, and the geographical limits where the name is going to be considered in use by you may well be a lot smaller than the state boundaries.12 If you had a trademark, you’d only have to prove someone else was using the same mark.
Bottom line: if you really want to protect your business name, get a trademark. You may also have to register a trade name, but what you want for your own protection is a trademark.
Image: Adapted from Open Clip Art Library
- U.S. Patent and Trademark Office, “Trademark, copyright or patent?”, Trademark Basics (http://www.uspto.gov/ : accessed 21 Jan 2013). ↩
- Caron Beesley, “The Difference Between a Trade Name and a Trademark – And Why You Can’t Overlook Either,” Community, SBA.gov (http://www.sba.gov/community/ : accessed 22 Jan 2013). ↩
- “Before you apply for a trade name trademark or service mark,” Business Registration Division, Hawaii Department of Commerce & Consumer Affairs (http://hawaii.gov/dcca/breg/ : accessed 22 Jan 2013). ↩
- “What are the benefits of federal trademark registration?,” Frequently Asked Questions about Trademarks, USPTO.gov (http://www.uspto.gov/ : accessed 22 Jan 2013). ↩
- Beesley, “The Difference Between a Trade Name and a Trademark – And Why You Can’t Overlook Either.” ↩
- See generally John R. Kettle III, “A Trademark Primer: The Rights and Wrongs,” Association of Professional Genealogists Quarterly (December 2012, 183-186). ↩
- Beesley, “The Difference Between a Trade Name and a Trademark – And Why You Can’t Overlook Either” (emphasis added). ↩
- “Will filing a trade name with the Secretary of State protect that name?,” Business FAQs: Trade Names, Colorado Secretary of State (http://www.sos.state.co.us/ : accessed 22 Jan 2013). ↩
- “Alternate Names,” State of New Jersey, Department of the Treasury (http://www.nj.gov/treasury/ : accessed 22 Jan 2013). ↩
- “Guide to Name Availability,” Business Services, Ohio Secretary of State (http://www.sos.state.oh.us/ : accessed 22 Jan 2013). ↩
- “Trade name registration,” State of Washington, Business Licensing Service (http://bls.dor.wa.gov/ : accessed 22 Jan 2013). ↩
- See, e.g., Junior Food Stores of West Florida, Inc. v. Jr. Food Stores, Inc., 226 So.2d 393 (Fla. 1969). ↩