Updated on April 18th, 2023
Can Two Businesses Have the Same Name?
It depends. If the business name is a registered service mark or trademark, another business cannot have the same name because it violates trademark law. You must perform a two-part test to determine if the business name is not a registered service mark or trademark.
A trademark or service mark protects the name of the business, services, and goods. If another company has a business name that is a registered service mark or trademarked, it is an infringement on the service mark or trademark for the later business to have the same name. If you own the trademark or service mark, you can send the infringing business a cease and desist letter to warn them of the infringement and punishable by law. The infringing business must change the business name because the trademark is already in use.
If the business name is not trademarked or service marked, you have to perform a two-part test to determine if two businesses can have the same name:
- Are the two businesses serving the same industry? If no, go to the second analysis. If yes, the two businesses with the same name can confuse consumers. The company using the business name first may send the new company a cease and desist letter.
- Are the two businesses serving the same geographic region? If yes, the two businesses with the same name can confuse consumers. The company using the business name first may send the new company a cease and desist letter.
For all new business owners, this is an understandable anxiety, especially if one is attached to a particular name. The answer to this question partly depends on the structure of the businesses involved. If a business is registered as a sole proprietorship, it does not have access to any business name protection. This means that if the company has the same name as another proprietorship, neither can claim trademark infringement. Both can have the same name in this case. Depending on one’s viewpoint, this can be good or bad. If one really loves their chosen name, then this may be a good thing. However, if one is worried about brand recognition, then this presents a problem.
In this article, our business attorney discusses:
Just like twins who look alike or identical, businesses with the same name can confuse consumers.
What Are the Business Naming Rules?
Each state may have different rules on what your business name can be. Nearly all states prohibit a company from registering the same business name that another company has already registered.
Naming rules are put in place largely because of consumer confusion. If two companies have the same name, or a very similar one, then customers may become confused or frustrated. For example, if Margaret’s stationary store competed with another store called “Scribble and Jot,” it would be almost impossible for clients to differentiate them. That said, if two companies share the same name but are not in the same industry, then everything may be fine. In this case, customers will not be confused because the companies are obviously participating in different fields.
For example, a tech company may have the same name as a nursing home. It is unlikely that consumers will confuse the businesses in this case. It would be an issue, however, if two companies operated in the apparel space and shared the same name.
There is also a “first come first serve” rule. If one’s business was the first to use and register the name, then one may have the ability to argue the legal right to the name. This is why it is a good idea to trademark a name as soon as possible, because this gives you even more right to the name.
How do you check if a name is taken for a business?
To check if a business name is already trademarked, go to the United States Patent and Trademark office online and search if another business has the same name.
To check if another business uses the same name in a state, go to the state’s Secretary of State’s website and search if another company uses the same name.
If an owner’s business is a sole proprietorship or a partnership, there isn’t a way to check if a name is already in use or reserved. The only option is to use Google or another search engine to see what appears online.
Now, if an owner decides to create a corporation, they can confirm the availability of a name by doing a federal trademark search. By searching the national database, they can see if the name has been taken already. The name must not be the same or too similar to another corporation’s name within the state.
How Do You Protect a Business Name?
The best way to protect a business name is to apply for a business trademark or service mark. Similarly, short filing a trademark, you may protect a business name by registering the business as an entity such as Inc., LLC, Corp.
If a business owner is concerned about having a unique and protected name, then it would be advisable to incorporate. By becoming a corporation, one’s name is protected and may not be used by another business.
An owner can also trademark the name. This means if anyone else tries to use the same name, an owner can pursue a trademark infringement lawsuit. This will help protect one’s brand.
What About My Domain Name?
The same trademark laws also apply to domain names. If an owner trademarks a domain name, then he or she may sue another business owner for trademark infringement. An owner can protect his or her domain name by purchasing it and using the URL on company packaging and marketing material.
What to do if another company is using your name?
If an owner comes across another business with the same name, trademark, or domain name, they can send that business a cease-and-desist letter. Our business civil litigation attorney can help your business draft and send a cease and desist letter to the company using the same business name. This serves as a warning. If the other business continues using the same business name, the owner can pursue legal action. If the owner proves that the infringement has negatively impacted their business, they may be entitled to damages.
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