Are You Legally Permitted to Use Your Chosen Business Name?
Your first step depends on whether you plan to incorporate your business. If you do, you should check with the Secretary of State's office in your state capital to see whether your proposed name is the same or confusingly similar to an existing corporate name in your state. If it is, the Secretary of State will not let you register it as your corporate name, so you'll have to choose a different one. If you don't plan to incorporate, check with your county clerk to see whether your proposed name is already on the list maintained for fictitious or assumed business names in your county. In the few states where assumed business name registrations are statewide, check with your Secretary of State's office. (The county clerk should be able to tell you whether you'll need to check the name at the state level.) If you find that your chosen name (or a very similar name) is listed on a fictitious or assumed name register, you shouldn't use it.
But beware--even if you are permitted to use your chosen name as a corporate or assumed business name in your state or county, you might not be able to use the name as a trademark or service mark in either area. To understand what all this is about, consider the three potential functions of a business name:
a business name may be a trade name that describes the business for purposes of bank accounts, invoices and taxes;
a business name may be a trademark used to identify and distinguish products sold by the business (for example, Ford Motor Co. sells Ford automobiles); and
a business name may be a service mark used to identify and distinguish services sold by the business (McDonald's Corporation offers McDonald's fast food services).
While your state's corporate or assumed business name registration offices can legally clear the name for the first purpose, they do not address the second and third. For example, you may get the green light from your Secretary of State to use IBM Toxics as your business name (if no other corporation in your state is using it or something confusingly similar), but if you try to use that name out in the marketplace, you're asking for trouble from the IBM general counsel's office.
To find out whether you can use your proposed name as a trademark or servicemark you will need to do what's known as a trademark search. This involves checking all state and federal trademark registers and, because trademarks exist without being registered, trade directories, major cities' yellow pages and other sources likely to turn up a similar name used by a competing business. To accomplish this you can, for a small fee, use an Internet-based service, such as www.micropatent.com, to do a preliminary (direct hit) search. Assuming your chosen name isn't being used by a competitor, you can then consider whether it's worthwhile to hire a professional search service to do a more in-depth search. A good trademark search service is offered by the Sunnyvale Center on Innovation, Invention and Ideas at www.sci3.com.
Assuming you find that the name is available and your service or product will be marketed in more than one state (or across territorial or international borders), it is wise to file an application with the U.S. Patent and Trademark Office to reserve the name for federal registration.