The Mechanics of Choosing and Protecting a Name for a Michigan Business - Part II
It is essential for Michigan business owners to understand that just because the Michigan Department of Labor & Economic Growth ("DLEG") registers a business name does not necessarily mean that the registered name is protected against infringing use. Business owners must understand the difference between the rights conferred by registering a business name with the DLEG and the rights to use a name or trademark to identify goods or services.
Registration of a business name by the DLEG simply means that the business has complied with the Michigan law that prohibits someone from using a name that is not distinguishable from other business names on the records of the DLEG's Bureau of Commercial services. The registration does not mean that someone else is not already using that name in connection with providing similar goods and services. Even worse, if someone was already using a name at the time it was successfully registered by someone else with the DLEG, trademark law may prohibit the use of that name by the person who registered it with the DLEG.
This means that a new start-up company may have to scuttle its plans for its business name if it receives a "cease and desist" demand or is hit with a trademark lawsuit seeking an injunction and/or money damages, even though the start-up company registered its business name with the DLEG. To prevent this from happening, a new business should conduct a thorough search of possible names in order to decide how protectable any particular business name will be if it is adopted and whether the name will infringe on someone else's trademark.
As if that weren't enough, there are Internet issues to consider when naming a business. Most businesses would prefer to use their corporate name as their web address. Examples of this include www.apple.com for Apple Computer and www.microsoft.com for Microsoft. But, registering a business name with the state authorities does not necessarily give substantive rights to an Internet domain registration for that name. Internet domain names are given out on a "first-come, first-served" basis, and business name registrations with state agencies have no effect on whether a particular Internet domain name is available. The Internet Corporation for Assigned Names and Numbers (ICANN) has a Internet domain name dispute resolution process - the Uniform Domain-Name Dispute-Resolution Policy - for those who believe someone has wrongfully registered an Internet domain name.
As detailed in these last two posts, there are a number of important issues that must be addressed when naming a Michigan business. A good Michigan business lawyer can help businesses with clearing possible names to use in connection with their activities.
