Entrepreneurs who consult a California small business attorney for business formation advice sometimes neglect to ask about what may seem to be the most elementary consideration for a fledgling business: what to name it. In today’s modern age, and in the incredibly complex business environment of California, naming your start-up business may not be as easy as tacking on “Inc.” or “LLC” to your word or phrase of choice.
According to the United States Census Bureau, there are more unique business entities in existence in California than in any other state in the union. In fact, more than 12 percent of all unique business entities across the country call California home. The lesson in these statistics is that an entrepreneur in California is far more likely than anyone else in the country to share an idea for a business name with another existing business. Sharing a business name with another business entity is not only illegal, but also detrimental to your efforts to distinguish your business’s products or services from those of other businesses in your market.
With this in mind, experts suggest that the owner of a California start-up business should come up with several different words or phrases and view them merely as candidates for the business’s name. Once the business owner is convinced that he or she would be satisfied with any of those several names, he or she should contact a California business lawyer for a consultation. A business lawyer will know the proper State databases to search in order to determine whether your prospective business names have been taken. Your lawyer can also help apply specific State rules about what constitutes a substantially similar business name. For instance, you may not be permitted to incorporate at “Haircuts, LLC” if “Haircuts, Inc.” or “Haircuts Co.” already exists. In a similar vein, something like “Haircutz” may be viewed as too similar to an existing name.
In deciding on a business name, the modern California business owner should also be mindful of whether the prospective business name is available as a domain name on the internet. Sometimes, a business owner may choose to incorporate under a perfectly valid and unique name in the eyes of California, but may fail to realize that the same business name is being utilized in another state, and that the internet domain name is already taken.
An additional consideration in choosing a business entity name is the likelihood that your business name will conflict with existing trademarks. For example, you may wish to start a company that sells accessories for Apple, Inc. products. Before you set your heart on a business entity name that features the word “Apple” or its products like “iPod” or “iPad,” you may want your attorney to investigate whether such use would infringe on another company’s trademarks, or whether you may be able to purchase a license for such use.
Suffice to say, it is prudent for your California business law firm to have just as much input in the naming of your business as you do.
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