Legal Question in Business Law in California

Re: Will I get sued?!?

If you use another company's trademark, they may bring action to stop you. This is increasingly a problem in business, with so many different companies and names in use. The easiest solution is to change the name enough to not be mistaken for the trademark. You will need good legal counsel if you go forward, or if you receive a 'cease and desist' notice from them. Contact me if interested in getting it sorted out successfully.

Re: Will I get sued?!?

Modern trademark law is based on federal statute (the Lanham Act) and is an outgrowth of earlier state, federal and common law that acknowledged, although somewhat haphazardly, that someone who used a distinctive name in trade acquired an enforceable property right in the name, somewhat like a copyright in an artistic or literary work or a patent to an invention.

Under the Lanham Act, someone who uses a distinctive name in trade to refer to their product or service can register the name for that class of product. If anyone else uses the name without the trademark registrant's permission is considered to infringe a property right and is potentially liable for damages.

Multiple registrations of the same name by different registrants is possible because each registration of a given name is specific to one (or perhaps several) categories of goods, for example "wine" or "childrens' apparel."

Forming a corporation with a name that's already registered as a trademark is not necessarily a violation of the trademark for at least two reasons: (1) merely putting a name on a corporation (or partnership, proprietorship, LLC or whatever) is not the same as using the name in trade as meant by the Lanham Act; and (2) your use of the name in trade, if and when you so use it, may be with reference to a class of goods or services not covered by the registered trademarks of others.

Still, so as not to tie your hands for future use of your proposed name, I suggest (1) using a name that is not trademarked, or (2) having a lawyer with intellectual-property experience advise you that a conflict is unlikely, or (3) obtaining the trademark holder's permission to use the name for your business and products or services.

No one can predict whether a trademark violation, or the appearance of a violation, will result in a suit. Sure, if you were in the beverage business and you called yourself Pepsi, you'd be sued upon discovery; but there are many trademark violations that are so small or so far removed in miles that no one notices and/or cares. It's better not to take the chance.