3 Essentials to Naming your Arizona Business
Starting a business is a big step for most people, even with help from a Phoenix business attorney. One of the first tasks facing new business owners is the naming of their business. A business’s name can have a huge impact on its success, so getting it right can be crucial to the future success of any new business. A trade name is in essence a business’s first impression as well as hopefully a succinct summary of the services or goods offered by the business. Potential customers and clients may very well decide whether or not to frequent a business based solely on its name.
To help new and experienced business owners alike select successful names for their businesses, this article will cover three essentials to naming your Arizona business with help from a Scottsdale business lawyer.
Choosing a name
This step may sound obvious or basic, and it may seem like this is simply a trivial exercise in creativity. However, there is much more to selecting a business name than simply thinking up a clever name. Of course, you do want to make sure that the name you choose is a good match to the purpose and mission of your business. You want the name to reflect the goods and/or services you plan on providing, as well as any other unique aspects of your business. If your business is going to be highly focused on unrivaled customer service, you may want to consider including something in the name that reflects that. If humor is part of your business or business plan, consider a play on words or some other form of humor for your business name. Your business name is your business’s introduction to potential clients and customers, so make a good impression and give those clients and customers a taste of what they can expect if they frequent your business.
Beyond simply drafting up a good name, however, you will want to do your research before you settle on a name. First, you want to make sure the name you choose is available and is not already in use by another entity. This will help you avoid infringing on someone else’s business name and allow your business to make a unique impression. To do this you can do a name availability search with the Arizona Corporation Commission, as well as with the Arizona Secretary of State and finally with the United States Patent and Trademark Office (USPTO). Do not make the mistake of settling on and getting comfortable with a business name before verifying that it is available.
Likewise, you want to be certain that the name you choose is available electronically. In today’s world of online shopping and social media, your business’s electronic and online presence will likely be as important, if not more, than any neon sign hanging over a brick and mortar store front.
For that reason, it is essential that you verify that any name you are considering for your business will be available as a URL. Although the URL does not necessarily need to be identical to the name you have chosen for your business, you probably want to avoid using a business name that is already being used as a URL by someone else. It is easy to imagine the confusion of potential clients and customers when your business name is “Arizona’s Best Business,” but the website “arizonasbestbusiness.com” directs them to something completely different. To make sure the name you choose is available electronically, you can perform a WHOIS internet search, look through websites such as godaddy.com which host web addresses, or check an accredited registrar registry.
Once you have verified that the name you are considering is available, both for registration as a trade name and trademark and electronically, you are ready to definitively choose your business name. Now you will want to turn your attention to ensuring you can benefit from all the advantages that come from operating under a well-chosen business name.
Protecting your business name
To understand how to protect your newly acquired business name, you will need to know the difference between a legal name and a trade name, commonly known as “doing business as” or “dba.” A legal name is the official legal name of a business which is registered with the state’s Corporation Commission or Secretary of State. The legal name is the name used on all government forms and filings.
A trade name, on the other hand, is simply the name under which a business is operating. A trade name does not have to be registered with any government entity. In most cases, the trade name will be the same as the legal name. However, there may be some cases in which a business is registered under one legal name while doing business under a different trade name. Although there may be good reasons for using a trade name different than your business’s legal name, it is typically best to operate under a trade name that is the same as your business’s legal name.
With that background information, you are ready to move forward with the protection of your business name. The first thing you will want to do is to register your legal name with the relative state entity. In Arizona, this will usually be the Arizona Corporation Commission or the Arizona Secretary of State, or both. Registering your business name in this way will offer your business the protections of a state trademark, allowing you to enforce your exclusive right to the use of your name within the state. For even greater protection you will also want to apply to the USPTO to obtain a federal trademark for your business name. This will allow you maximum protection for your name from infringement, even across state lines.
Keep in mind that Arizona trademark registration involves quite a bit more detail than the brief summary provided here. Additionally, even though you may have done careful research and found a name that has not been registered yet, you may still encounter problems after registering your trademark. This is due to the fact that trademark law typically grants prior rights to a name to the first person to use the name, not to the first person to apply for or successfully register a trademark. This can lead to problems when you register a name that you did not know has actually been in use, despite your best efforts to research the business name for exclusivity.
Although this can be frustrating, you can take precautions to protect your business and business name as much as possible in the event an unknown party comes forward claiming you have infringed on their business name. First, keep good records. Being able to clearly show how long you have been using a certain name and how the name has been used may help you and make it more difficult for someone bringing an infringement claim against you to show that they actually were using the name first. Second, as early in the registration process as possible, have an attorney do an entity search and provide you with an opinion letter stating that, to the best of the attorney’s knowledge, the name in question is not being used by any other entity. Although this may not absolve you of all liability, it will allow you to show that you made a good faith effort to find a name that was not already in use and may either negate or substantially reduce any damages you might be liable for infringement. And finally, make sure to stay aware of other entities or businesses that may be using or infringing on your business name and work with an experienced intellectual property attorney for advice on how to best proceed against infringers.
Creating a legal entity
The third step in naming and creating your Arizona business is to create an official legal entity for your business in Arizona. This will provide you personally, as well as your business, with additional legal protections. It is important to note that although this step is listed last in this list, it is not necessarily something that will be done last chronologically as you decide to create and name your business. Consulting with an experienced Arizona business attorney will allow you to be sure that your business is created and named in the best way possible under Arizona law.
Creating a legal entity to carry your business name will primarily protect you from direct liability arising from your business dealings. Operating your business as an LLC or other corporate structure will make sure that if something goes wrong and your business suddenly becomes liable for something, that liability will not extend to you personally. Without this structure in place, for example if you decided to dom business personally under a trade name, liabilities might reach you personally, leaving you on the hook for any damages your business might have to pay. An experienced Arizona business attorney can help you know how best to structure your business to help you reach your personal business goals.
Naming and creating your business can require a substantial amount of time and effort, but it will be well worth it when you have finally settled on a winning business name after following the steps outlined above. Your business will be better off for it, and you will be that much closer to realizing the vision you had for your business when you first started out. With this knowledge and quality legal counsel at your side, you will be giving your business its best chance at success. Of course, when you find yourself in need of legal advice, such as when you are naming and creating your business, the Gilbert business attorneys at Denton Peterson Dunn, PLLC are here to help you every step of the way.