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One of the trickier aspects of starting a new San Diego business is picking a good company name. As we discuss below, it is generally a bad idea to pick YOUR personal or family name as the name of your company (unless you are a professional where your personal reputation is the basis of your business).
Using lessons from trademark law can help focus on the characteristics that define commercially “good” names as opposed to commercially “bad” names. Thinking about trademarks is useful because you should think of your business name as your first business BRAND. A good name — a good brand — can be the first step towards a successful business. Consulting with a skilled and experienced corporate lawyer can also be a good first step. Here are some lessons from trademark law.
San Diego Corporate Law: Spectrum of Distinctiveness
Trademark registration is governed by the Lanham Act codified at 15 U.S.C. § 1051 et seq. In general, trademarks can be rated on a spectrum of strength. The strongest trademarks are termed fanciful/made-up marks or arbitrary marks. A made-up word is a strong mark because it is unique and new, like the word EXXON. Equally as strong and unique are arbitrary marks where the name/brand/word has no normal association to the product, like the word “Apple” as related to computers and phones or “Camel” with respect to cigarettes.
In the middle of the spectrum are what are called “suggestive” marks and, then a bit weaker are “descriptive” marks. A famous example is Miller Brewing Company’s effort to trademark LIGHT BEER. Registration was denied because the proposed mark was merely descriptive — describing the product (beer) and its color/density (light). See Miller Brewing Co. v. G. Heileman Brewing Co., 561 F.2d 75 (7th Cir.1977).
San Diego Corporate Law: Purpose of a Brand
In general, for a trademark to be registered with the US Patent & Trademark Office, the proposed mark must “function as a mark.” That is, a proposed mark must serve as an indicator of the commercial source of products or services. This is why a trademark must be distinctive — or have acquired distinctiveness. The function of a trademark is to uniquely identify YOUR product or service.
A business name serves the same function. A commercially successful business name is one that uniquely identifies YOUR business and the products and/or services that you provide.
San Diego Corporate Law: Applying Trademark Lessons to Picking a Name
Thinking about the various categories of trademark distinctiveness can help you craft a good business name. Certain types of businesses may lend themselves to completely fanciful and/or arbitrary names. For example, if you are opening a San Diego dance club, maybe “Jalapeno” is a good name. The name evokes hot and spicy, but is also memorable as an arbitrary name since jalapeno peppers are not normally associated with dance clubs.
A good name can create commercial success by lending itself to synergistic marketing. For example, dance club Jalapeno in San Diego will be world famous for serving Jalapeno Martinis! — and will have the world famous slogan: “Can You Handle the HEAT!?”
On the other hand, if you are opening a retail store, you may want some part of the name to be descriptive; but not entirely. Thus, if you are opening a flower shop in Balboa Park, it is probably TOO descriptive to choose “Maria’s Balboa Park Flower Shoppe.” Yes, the name describes what you are selling, but it is three descriptions and not very evocative or memorable. Of the three descriptions — owner’s name, location and type of shop — probably only the idea of “flower” is necessary. First, why limit yourself to Balboa Park. You can sell flowers all over San Diego. Second, why limit yourself to “Maria?” Maybe you will add a partner someday whose name is not Maria. So, keep the idea of “flower” but maybe go more evocative — “floral” — and add something arbitrary — like maybe “glass tower” — resulting in Glass Tower Floral Designs.
Like “Jalapeno,” “Glass Tower” can provide easy design and marketing tie-ins. Your vases might tend towards tall and glass and the floral arrangements might tend toward airy and ethereal, giving your new business a competitive niche.
Contact San Diego Corporate Law
If you would like more information, contact attorney Michael Leonard, Esq., of San Diego Corporate Law. Mr. Leonard provides a full panoply of legal services for San Diego and California businesses. Mr. Leonard can provide advice and counsel on starting up a new business, with respect to forming a new corporate entity, assist with corporate formalities, and can help review and draft business contracts. Mr. Leonard can be reached at (858) 483-9200 or via email.