How to Choose Your Corporate Name

You’ve done it.  After brainstorming for hours, furiously using Google to search for synonyms or words that rhyme, and running names by friends and family, you’ve finally found the perfect name for your business. You are delighted to find that the matching URL is available, at least in the .us top-level domain.  However, you are not yet in the clear.

When selecting a corporate name, you should consider the following questions:

1. Is the name available for use and registration as a trademark in the U.S.?
2. If you plan to expand your business internationally, is that name available for use and registration abroad?
3. Is the name available as a registered business name with your state of incorporation’s Secretary of State’s office?

Do I need to check to see if my business name is available before I start using it? 

Technically, no, but it would be prudent to do so.

You want to avoid using a name that is likely to be confused with the name or brand of an already-existing business.  Why?  You want a name that differentiates your company and upon which you might build your brand and reputation.  This will be harder to accomplish if there’s another company out there with the same name.  Beyond that, you want to ensure that you are not unknowingly exposing your business (and possibly yourself) to legal challenges by third parties who might later claim that you are infringing on their trademarks.

Before you adopt your corporate name or register your company name with your state of incorporation’s Secretary of State, consider hiring an attorney to verify that the name is available in the United States and all other countries in which you intend to use it.  This could save you time, money, and heartache of having to rename your company or defend a legal challenge to your name down the road.

How do I know whether a name is available for registration and use as a trademark?

Your attorney may obtain and analyze reports that identify third party company names, trademarks, and other uses that are not only similar to your name but also used on products or services that overlap with, or are related to, your products and services.  A preliminary search of the United States Patent and Trademark Office (USPTO) and the records maintained by the various state trademark registries is done online. Your attorney may also conduct an online search to identify any other unregistered uses of the same name.

Full trademark searches are more comprehensive since they look not just at registered marks and applications, but also at business directories and domain names.  Full searches rely on technology to identify online uses of identical and highly similar names. This type of search is more expensive, but is far more thorough and generally cost effective given the high cost of name changes after a corporation has begun significant operations.  Giving careful consideration to these issues during the planning and organizational phase can save you considerable frustration, time and money in the future.  Contact your attorney for further information on these matters and the advisability of doing a comprehensive trademark search.

Company name availability determined through the name check process with the various Secretary of State offices (see below) does not guarantee that the name is available for use as a trademark in connection with the sale of particular goods or services.  Put another way, securing a name through filing of incorporation documents, qualifying to do business, or even registering a related domain name, does not confer trademark rights. Therefore, if you intend to use some variation of the corporate name as a trademark or service mark in your business, it is typically worth conducting trademark searches to determine if there are conflicting or similar trademarks or names in use.

If you intend to operate your business or offer your goods or services in a foreign country (either now or in the future), it is important to run a trademark availability search in those other countries as well.  Registering a trademark with the USPTO is national in scope – if you want to protect your name in another country, you must obtain a separate trademark registration in that country.  Clearing your trademark in all relevant countries is important: when it is time to expand, you don’t want to be caught off guard with the realization that you cannot use your company name in that key foreign market.  Consider also that rights in many countries outside of the U.S. are based on registration – not use – making it even more important for you to consider international trademark filings.

My attorney found that my corporate name is available to use as a trademark, now what?

Once your attorney has cleared the mark for trademark use and registration, you should consider filing a federal trademark application in the United States after your business is formed (except under certain circumstances where your attorney has advised against filing, or advised you to wait to file a trademark application).  Remember, trademarks are based on priority, and filing a trademark application grants you nationwide priority rights from the date of filing (even if you do not actually use the mark for months or years after).

You and your attorney should also strategize regarding the right time to file (if not immediately), whether to register your business’s other logos and slogans, whether to pursue international trademark protection, and discuss any risks associated with your use or registration of your company name.

To learn more about trademarks, see our article on Neglecting Trademark Protection Could Be a Costly Mistake.

Is the name available to use as a business name in my state of incorporation?

Determining whether a name is registrable and available as a business name is different than determining whether a name is available as a trademark or trade name.  Business names are simply based on availability (similar to trying to register a personalized vehicle license plate with the DMV).  Although your corporate name may be available as a trademark, it might not be available as a corporate name in your state of incorporation (e.g. if there is already another company incorporated under the same name).

What’s in a Name: State Requirements

It is necessary to check the corporate statutes of the proposed state of incorporation for any special provisions relating to corporate names when considering a new company name. Corporate law requirements will vary from state to state.

Delaware

In Delaware, for instance, the corporate name must contain one of the words “association,” “company,” “corporation,” “club,” “foundation,” “fund,” “incorporated,” “institute,” “society,” “union,” “syndicate,” or “limited,” (or abbreviations with or without punctuation). The Division of Corporations in the Department of State may waive this requirement (unless it believes the name is, or might otherwise appear to be, that of a natural person) if you execute, acknowledge and file with the Secretary of State a certificate stating that your total assets are not less than $10,000,000. In addition, your company name must not contain the word “bank” or any variation thereof, with some exceptions.

California

In California, the Secretary of State will not grant a reservation for a corporate name that is likely to mislead the public, including names that suggest a false impression of government affiliation (e.g., “agency,” “commission,” “department,” “bureau,” “division,” “municipal” or “board”). The words “bank,” “trust,” “trustee,” or similar terms may only be used if a Certificate of Approval from the Commissioner of Business Oversight (Commissioner) is attached to the Articles of Incorporation.  Use of the word cooperative, or any abbreviation of that word, may be a part of a corporate name only if the corporation is incorporated within the definition of California Corporations Code section 12311(b).

Name Availability

The Secretary of State or similar office for virtually all states maintains a consolidated list of the following:

1. names of all corporations, limited partnerships and limited liability companies and (in some jurisdictions) partnerships (“Covered Entities”) in good standing;
2. names of all Covered Entities qualified to transact intrastate business and in good standing in the state;
3. corporate names already reserved;
4. sometimes, names of nonqualified Covered Entities registered under a state trademark registry; and
5. names that will become record names of domestic or qualified foreign corporations at some delayed effective date of a filed corporate or partnership or limited liability company instrument, such as a merger agreement.

The Secretary of State will not accept a certificate of incorporation for filing if the stated corporate name resembles closely, is confusingly similar to, or is the same as any name on the consolidated list. The Secretary of State’s office typically does not care whether the conflicting name belongs to a competitor or to a company in a totally unrelated industry.  For example, an attempt to register the company name Gene Machines for a genetic laboratory equipment business with the California Secretary of State’s office would be unsuccessful if another business had previously registered for the use of Gene’s Machines as a motorcycle repair shop company name (by contrast, the USPTO would typically allow registration of similar names for unrelated goods or services). Note that the Secretary of State frequently considers the words “corporation”, “incorporated” and “inc.” to be equivalents for purposes of availability.  Furthermore, most states have restrictions regarding the use of particular “industry reserved” terms such as “bank,” as noted above in the cases of Delaware and California.

A further consideration in selecting a corporate name is whether that name is broadly available for use in other states where the corporation will be conducting business. A corporation must qualify to do business in any state in which it does business. In each of those states, it is necessary to check name availability. If a name is not available, state laws generally provide for the use of an “assumed” name (sometimes referred to as a “dba” (“doing business as”) in a foreign state.

Reserve and Get Advanced Approval for Your Corporate Name

Proposed corporate names for new corporations, as well as newly qualifying foreign (out-of-state) corporations, may be pre-cleared through the name availability section of the Secretary of State’s office of the appropriate state prior to the submittal of documents for filing. The pre-clearance and/or reservation of a corporate name will help you avoid the rejection of documents submitted to the Secretary of State for filing because of a name conflict.

Delaware

If you are incorporating in Delaware, a preliminary check of the name availability may be obtained online at https://icis.corp.delaware.gov/Ecorp/NameReserv/NameReservation.aspx.  If the name is available, you may then proceed in reserving the name for a period of 120 days.  Every entity that is to be formed or incorporated in Delaware must be represented by a Registered Agent located in the State of Delaware.  Your registered agent can help you to reserve your name in that jurisdiction.  Contact your attorney to facilitate this process.

California

The availability of a name may be determined on a preliminary basis by California Secretary of State’s office website https://bizfileonline.sos.ca.gov/search/business

Checking the availability of a name does not automatically reserve the name.  You can request to reserve a name for a period of 60 days by completing an online form through the Secretary of State’s Office and paying an online processing fee of $10.  (Online form can be accessed under “Name Reservations”: https://bizfileonline.sos.ca.gov/)

You can immediately reserve your corporate name in order to ensure its availability; your attorney can assist you with this.  Your attorney likely has a prepay priority account with the California Secretary of State’s office, and can expedite filing a Name Reservation Request through a filing service.

If your desired company name is not available because that name or a similar one is in use, it is possible to obtain the consent of the entity using the name and file the consent with the Articles of Incorporation or Certificate of Limited Partnership or Articles of Organization. You may obtain the address of the entity already in existence, and the name of its officers, from the Secretary of State’s office.  Again, you should talk to your attorney about this option.

In states other than Delaware and California, the time period for which names will be reserved varies greatly. When a corporate name has been reserved in one or more states, it is advisable to calendar the expiration date.