Brand owners are often concerned about the relationship between their company identities, domain names, and brand identities (handles) on social media. Trade Names and Domain Names are not automatically trademarks, although they can become trademarks through consistent use in commerce.

Trade Names

A trade name is the name used to register a business as a legal entity in the state where is operates.  Usually this is done at the state level. The trade name is also registered with the Internal Revenue Service for purposes of federal tax laws.

Your trade name is used on contracts and other legal documents where your legal business name is needed. For example, if Mr. Coyote is the officer of a corporation and signs an agreement, he signs it as “CEO of Acme Corporation.” Anyone who wants to check the legal status of that legal entity can investigate a corporation on the records of its state of incorporation.  For that reason, contracts normally will state the party to the contract and include something like this: “A New Mexico Corporation” because that information allows someone to identify and research the legal status of the business.

A trade name must be unique within the state where it is registered, however a similar or even exactly the same name might be used in other states. A very similar name could even be used by another business in the same state.  Generally, there’s no trademark implications, because only the specific trade name—the precise legal entity name—is what matters in legal documents.

Companies may use their trade name—the name of the legal entity that they operate through—as the public-facing brand for business.  But there is no requirement that a company’s branding and trademarks be the same as the trade name.

What is a trademark?

A trademark is a symbol that denotes a source of goods or services in the minds of consumers. A trademark, among other things, conveys the brand’s identity to people in the marketplace. In the United States, trademarks can be created and rights established by use or a trademark can be registered at the United States Patent and Trademark Office (USPTO). Trademarks can also be registered at with World Intellectual Property Organization (WIPO), in other countries, and at the state level.

A trademark might be the same as the trade name of a company (that is, the name of its legal entity, but often a company will use a different word or symbol for its trademark. So, for example, Mr. Coyote might sell anvils using the trademark ACME. His company might have ACME as its trade name, such as Acme, Inc., but it could also be completely different, e.g. Wileco, Inc. ACME is the public-facing name of his anvils and the term that represents the goodwill of his business in the minds of his customers. When consumers see ACME in relation to anvils, they will know that they are coming from Mr. Coyote’s company, Wileco.

Domain names

A domain name is the placeholder that lets your browser contact a specific computer where web pages are stored. By purchasing a domain name, you have the exclusive right to it. However, because domain names are not automatically trademarks, owning a domain name does not give you any trademark rights in that name.  In order to have a trademark right based on use of that trademark, you must sell goods or services using the domain name as a source identifier. However, simply owning a domain name does not confer trademark rights. So, for example, if our redoubtable Coyote’s company buys the domain name acmeanvils.com, it allows him to have the exclusive right to it as a page director, but it is not a trademark. “acmeanvils.com” has to be used as the source identifier to acquire trademark rights. If Wileco brands the anvils with the mark “acmeanvils.com” or advertises the anvils using the whole term “acmeanvils.com”, he is now using the domain name as a trademark.

Domain names are international in scope and are not tied to national trademark registries. Trademarks are registered only for specific goods and services in particular jurisdictions. So, for example, only one entity in the world can own apple.com, even though several companies own a trademark registration for the word APPLE for various goods and services.

If you own a trademark and someone else registers a domain name for the purpose of confusing or misdirecting your customers, or reselling the domain to you at a profit, then owning a trademark registration can be very helpful to show that you have a legal right to use that domain name. However, if another company simply doing ordinary business is using a domain name that you want, you don’t automatically have a legal basis to object. To follow on the example above, if Wileco owns a trademark registration for ACME, but never bought the domain name “acmeanvils.com”, and someone bought it to sell anvils, he may have a trademark infringement claim. If the other party, suppose it’s BeepBeep LLC, is using “acmeanvils.com” to fool Wileco’s customers to buy their own anvils, he may have a bad faith claim. However, if the other party is a band called the Acme Anvils, using the mark “acmeanvils.com” to advertise their music-related goods and services, Wileco will have a much more difficult time. If someone already owns the exact domain name you want to use, and particularly if you wish to use it as a trademark, your best option may be to work with your attorney to approach the owner for purchase.

By understanding the differences between trademarks, domain names and trade names, you can check the availability of what you need, register what you are using or plan to use, and better cultivate your legal rights.

Resources:

https://www.uspto.gov/trademarks/basics/what-trademark

https://www.sba.gov/business-guide/launch-your-business/choose-your-business-name

Stephanie Semler

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