Legal Question in Business Law in California

First, remember that the purpose of the fictitious business name registration is to cause a loss of privacy. California doesn't want people (or entities) engaged in business to run anonymously or secretly, and for good reason.

Next, the real issue here is probably whether you are actually conducting a business as meant by the statutes on FBN registration requirements.

After some thought, I must say that I'm uncertain whether a prosecutor could make a case that you are "doing business" within the meaning of the law (Business & Professions Code sections 17900 et seq.) when you are only receiving what amounts to an income strream.

I also considered whether LS and you could be considered to be in a partnership or joint venture. I don't think so. Although partnerships sometimes "occur" without the knowledge or intent of the partners, there is a requirement of coownership, and I don't see that here.

I believe I would advise most clients to go ahead and file, to be on the safe side. However, since you are publicity averse, there is another approach worth considering. Form a corporation under the selected name. Then, it won't be fictitious. Have someone else that you know (and trust) be the sole director and hold all the mandatory officer positions. You can be the sole stockholder. It will cost filing and franchise fees, and may expose your "straw person" to some grief, but it seems entirely legal and keeps your name out of any public record.

The general rule in california is that an Individuals or entities doing business for profit under a name different from the owner(s) full legal name(s) must file a Fictitious Name Statement with the registrar-recorder/county clerk office in the county where the business resides.

Given the rule above, whether you have to file for a DBA depends on how your relationship with this out-of-state corporation is established and if you decide to use a fictitious name with your business. If you are receiving profits in California, it is likely that you are conducting business in California. So the issue now is whether you decide to run it under your own full name or a different fictitious name. As you did not provide information to this regard, I cannot answer your question more fully.

Contact an attorney in your area, or feel free to give me a call.

Jim Betinol

Partner

Withrow and Betinol Law

E: [email protected]

P: 424.229.2560

F: 424.258.7001

Disclaimer: This communication does not create an attorney-client relationship and such a relationship can only be formed through a signed written agreement. This communication is not legal advice and should not be solely relied upon in making your legal decisions. Any situation depends on many different facts and specific laws that require an in-depth legal consultation to evaluate the best solution for your needs.

There is no penalty for doing business under a fictitious name without registering it, except that you cannot sue or defend a suit based on business you conducted under the unregistered name. What confuses me, however, is why you even care. If the only business you are going to conduct is as an author with this company that takes the orders, prints, sells and delivers the books, what do you need a fictitious name for anyway? Why can't your contract with the company be in your own name? Then the issue goes away.